York City chairman Douglas Craig has warned a consortium its hopes of buying the beleaguered club are likely to be dashed.

Mr Craig told local business people and council leaders the bad news at his first meeting with them yesterday, hours before City's eagerly-anticipated FA Cup tie against Fulham.

More than 8,000 fans were expected at the Bootham Crescent ground for this afternoon's clash with Mohammed Al Fayed's Premiership club.

City of York Council is now to meet the consortium members to discuss whether it is worth their while to make a formal bid at this stage.

Any prospective buyer of the club must find £4.5 million.

In a statement agreed by the council and the club, Coun Alan Jones, executive member for leisure, said: "We were told by Mr Craig that he is discussing two serious offers which were likely to exceed any bid from the consortium.

"The council now wants to discuss with the consortium whether it would be worth making a formal bid at this stage.

"In the meantime, Mr Craig undertook to give the council a further assessment of the situation within two weeks. He has also reassured us that all of the parties involved share with us the desire to secure the future of the club."

John Batchelor, owner-driver of the B&Q-sponsored Honda Integrity Racing Team, revealed exclusively in the Evening Press yesterday that he was at an advanced stage of negotiations for the purchase, but it is not known if his is one of the "two serious offers" referred to by Mr Craig.

Asked about Mr Batchelor's bid, Mr Craig said: "I'm not prepared to give any information whatever, on any private conversations I may or may not have had with people who may be interested in acquiring the club or the company."

Meanwhile, a Liberal Democrat MP has criticised City's plight in a speech to the House of Commons.

Vincent Cable, a trade and industry spokesman, spoke during a debate on a new Industrial and Provident Societies Bill he said would ward off "carpetbaggers and asset strippers".

He said he was a fan of York City in his youth, but added: "City is now in danger of extinction, and the reason is that, like most football clubs, it rests on the support of a few business people who've put a lot of money into it.

"In York, most of the business people involved treated their involvement as a mutual.

"But one of the business people hadn't, and he spotted a loophole in the law whereby he can sell off the club, sell off the grounds, and make millions of profit, and there is not sufficient safeguard to stop that happening."

Updated: 09:48 Saturday, January 26, 2002