London Olympic Stadium deal collapses

The future of London’s Olympic Stadium will be opened up to a

new bidding process after a deal to award the flagship venue to

West Ham soccer club was scrapped Tuesday amid ”legal

paralysis.”

The British government was forced to abandon its long-term

solution for the $760 million stadium amid concerns the venue could

remain empty for years after the 2012 Olympics.

The stadium will remain in public ownership after the 2012

Olympics and be rented out to an anchor tenant, the government

said.

West Ham said it will bid again and the new terms will be more

financially favorable for the club recently relegated from the

Premier League. A $31 million up-front payment will be replaced by

smaller annual rent.

London Mayor Boris Johnson said the stadium will ”almost

certainly” go to West Ham and will definitely retain the running

track that losing bidder Tottenham wanted to rip out.

The drawn-out wrangling for control of the stadium has been

increasingly acrimonious since West Ham was selected ahead of

Tottenham in February as the preferred long-term tenant.

”The process to sell the stadium has become bogged down. We are

acting today to end the legal paralysis that has put that legacy at

risk,” Sports Minister Hugh Robertson said. ”Ending the current

sale process and looking for a leasehold solution will remove the

current uncertainty and allows us to help secure the future use of

the stadium with more confidence.”

Tottenham mounted a full legal challenge against the decision by

West Ham’s local authority to provide a $63 million loan to fund

the second-tier club’s move into the stadium. The case was due to

be heard in court next week, but appeals could have dragged on for

years.

”That could have put at risk the reopening of the stadium in

2014,” Robertson said.

Johnson said the move would put an end to ”the great deal of

legal to-ing and fro-ing” over the stadium, which West Ham wants

to downsize from an 80,000 to a 60,000-seat capacity. Some $55

million has already earmarked under the Olympic budget to downsize

the stadium.

”We will keep it in public hands,” he said. ”We will

effectively rent it to a football club, almost certainly West Ham,

and that will cover the costs. I think it will be a very, very good

deal for the taxpayer.

”The crucial thing is it will simultaneously deliver a football

solution for the stadium and an athletics legacy at the same

time.”

John Biggs, a city council member representing the area that

hosts the stadium, described the collapse of the deal as ”a fiasco

and a tremendous waste of public money.”

Fourth-tier east London club Leyton Orient was also challenging

the decision, while an anonymous complaint to the European

Commission about the apparent use of Newham Council funds by West

Ham fueled concerns that the legal disputes could drag on for

years.

One certainty is that the running track will remain in the

stadium regardless of the outcome, with London bidding to host the

2017 world track and field championships.

”It’s fantastic for UK Athletics and it is a bold and decisive

move by the legacy company,” UK Athletics chairman Ed Warner

said.

Leyton Orient chairman Barry Hearn confirmed his club would also

bid for the stadium, including the possibility of sharing the

ground with another club.

”The OPLC have finally listened to someone with common sense

and said, ‘We messed it up before, let’s not mess it up again.’ The

whole process starts now,” Hearn said.