The Hong Kong owners of Birmingham City Football Club said they plan to sell 12 percent of the club to a Beijing advertising firm for HK$45 million to bring it new business opportunities in China.
The sale by Birmingham International Holdings Ltd comes as that company`s shareholder and former chairman Carson Yeung awaits the outcome of a money laundering court case against him in Hong Kong. He denies all the charges.
Birmingham City won the English League Cup in 2011, beating Arsenal at Wembley, but were relegated from the Premier League to the second-tier Championship in the same season.
The stake sale to the company, whose Chinese name translates as Beijing Liangzhu International Media and Advertising Company Ltd, is part of a plan by Birmingham International to unload up to 24 percent of the club, the holding company said in a Hong Kong stock exchange filing.
Yeung and other investors bought into the English Midlands club in 2007 and acquired the rest in 2009. Birmingham International said last week that Yeung would step down with effect from Feb 4.
The flamboyant 53-year-old Hong Kong businessman and former hair stylist to Hong Kong`s rich and famous still owned 21.5 percent of Birmingham International last year, according to its annual report.
The stake sale announcement came after Hong Kong markets closed. Earlier on Wednesday, Birmingham International`s stock jumped 10 percent to HK$0.164, outpacing the main Hang Seng Index <.hsi> which rose 1.5 percent.
"The company can raise further capital from the disposal and will be able to collaborate with the new Chinese partners to enter into the China market through their connections in the People`s Republic of China," Birmingham International said in the stock exchange filing.
"The board believes that the terms of the disposal are reasonable and in the interests of shareholders as a whole."