The immediate future of the Newcastle Jets is again in limbo after a prospective ownership group in advanced talks with the A-League club pulled out of the running.
Sources with knowledge of the situation said the investors had been in a period of exclusive negotiations and due diligence with Football Federation Australia, which expired on Sunday.
The consortium – which was being fronted by prominent player agent Buddy Farah, and is believed to have included several locally-based businessmen – then told the Jets and FFA on Monday they were formally withdrawing their interest after the club was unable to produce audited financial accounts for the last two years.
Sources have told the Herald that some elements of the FFA board felt the best course of action this season was to pull the club's licence from absentee chairman Martin Lee and withdraw the Jets from the A-League, with a view to bringing the club back in the following season with a new owner and on a more stable footing.
Some club executives also share that position, but high-level league sources have confirmed the Jets would be saved and that their participation in the forthcoming season was not in doubt.
The clubs see the Hunter region as a football hotbed and a vital market for A-League and W-League, and the Jets as a team with enormous potential that can be realised with the right ownership.
However, the Jets are believed to be owing several million dollars in debt to creditors – including the operators of their home ground, McDonald Jones Stadium – which could complicate any licence handover.
While other investors are still believed to be in the mix, a sale is unlikely to be completed before the start of the new season on December 27 – which means Newcastle will begin the next A-League campaign mired in off-field turmoil, with no permanent coach in place and with several vacant spots in their playing squad yet to be filled.
It appears other A-League club owners will have to bankroll the club for an interim period until new owners are found for the Jets, through a mooted "safety net" fund which was first reported by the Herald in August.
Western Sydney Wanderers chairman Paul Lederer – the head of the Australian Professional Football Clubs Association – told the Herald in October that owners had committed to bailing out financially-stricken clubs like the Jets, and again repeated that pledge in a separate interview with SBS last week.
Farah and Jets chief executive Lawrie McKinna declined to comment, while an FFA spokesperson said discussions were ongoing with "a number of prospective buyers".
McKinna revealed earlier this year that Lee, the Chinese lighting magnate who bought the team in 2016, had not put any funds into the club since October 2019.
Key players including Bernie Ibini and Steven Ugarkovic have also been agitating for a release from their contracts due to the uncertainty surrounding Newcastle's future.
As things stand, the A-League is still the legal responsibility of FFA, but the governing body has no financial capacity to run the Jets as it has done previously for clubs which have fallen on hard times.
But the long-awaited legal ratification of the professional leagues from the governing body could come as soon as next week, and that would pave the way for other club owners to bail out the Jets in the short term.
"A change of ownership is clearly needed to revitalise the club and put it on a sound footing again and continue their important role in the Northern NSW community and we are hoping to have a new owner for the Newcastle Jets very soon," an FFA spokesperson said.
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