The former owner of Wigan Athletic has written off two huge debts owed to companies he owns.
The club dropped into administration after Au Yeung Wai Kay stopped providing money to continue operations.
However, the administrators have now announced that the Hong Kong-based businessman has agreed to forgo any right to debts of £25.3m and £10.7m, which were owed to two of his firms.
The decision is a huge step forward for plans to sell the club as it means the business is now in considerably less financial trouble.
In a major statement released today (Thursday) the joint administrators confirmed that the debts had been written off. They also hit out at a report from The Sun newspaper over stories about a bid to buy the club.
They said: “The joint administrators have previously made references to the club owing debts of £25.3m and £10.7m to Next Leader Fund, L.P. and Wigan Athletic Holdings Limited respectively.
"There has been much speculation, both on social media and elsewhere, regarding these debts and to what extent they would need to be repaid in the event of a successful sale of the club.
“We should like to clarify this matter and to now inform fans that the administrators have been in discussions with Mr Yeung, who has cooperated fully for the benefit of the club and who has agreed, in order to ensure the survival of the club and to give the administrators the best possible chance to agree a sale, to waive his rights to the repayment of the debts owed to him and to his companies.
"He has given the administrators the powers necessary to put this into effect and to use all monies for the benefit of the club. By waiving all his rights Mr Yeung has also made it much more possible to pay the necessary 25p dividend to the creditors and thus avoid a further 15 point penalty next season.
“The joint administrators note that in the Sun article of August 20, its professional journalist Mr Alan Nixon goes into great detail about a bid from Randy Frankel and Michael Kalt.
"Firstly, we would point out that release of any information by them (or someone in their group) is a complete breach of the non-disclosure agreement. Secondly, we would inform fans in the light of this breach that no credible bid has been received from this organisation that would lead to the saving of the football club.
"Talks, however, are continuing with serious bidders with a view to bringing a successful sale to fruition.”
