The club says football will continue to be played at Elland Road

"We have the right to buy it back at any time at a pre-arranged formula," said chairman Gerald Krasner.

Sainsbury, backed by Nova Financial Partners, failed to transfer £25m by the 1300 GMT Friday deadline.

A local consortium is now in advanced talks with Leeds and chairman Gerald Krasner is confident of "finalising a deal over the next few weeks".

Leeds' board set the deadline for Sainsbury and American-based Nova Financial Partners as it needed to pay the latest instalment on a loan to Aston Villa shareholder Jack Petchey by close of business on Friday or trigger a £2m penalty clause.

With the funds not transferred in time, Leeds had no alternative but to use their most bankable asset, Elland Road, on a 25-year deal to raise the funds.

It is a bit like a house - you either rent it or own it but the main thing is you live in it Leeds chairman Gerald Krasner

"I am hopeful that in a few years we will have re-established the club, have got some more backing and be able to buy the ground back," said Krasner

"The individual [who now owns the ground] wants his rent paid, that is all he is interested in.

"It was most important that this re-organisation took place."

Krasner refused to discuss the financial details regarding the ground but revealed Leeds gave Sainsbury and Nova Financial Partners six chances to execute their takeover.

"In the interests of the club and the fans it would have been very foolish not to give the American consortium time to come up with the substantial monies," said Krasner.

"Not withstanding this offer, the board has also worked on an alternative strategy over the last few weeks."

And Krasner added that talks with the local consortium, believed to be headed by businessman Norman Stubbs, are already at an advanced stage.

"I'm hopeful of this," he added. "After 13 failed attempts of consortiums producing money, these are local business people who have plans for the future.

"It is more important than anything that they are die-hard Leeds United fans.

"We are now moving forward with the hope of finalising this deal [with the local consortium] over the next few weeks."

To be honest no one would invest in Leeds from a business perspective Gerald Krasner

Sainsbury and Nova Financial Partners had remained confident throughout the week that their takeover deal would be completed in time.

Nova president Michael Lucas said earlier in the week: "We are looking forward to completing the contract and working towards Premiership status."

On Tuesday Leeds received a faxed copy of a HSBC bank account showing substantial funds and a covering letter stating the monies were available for a takeover.

"The name of the account holder had been blanked out on this document and Nova's solicitors are still awaiting verification of this document," said a statement on the club's website.

Nova told Leeds on Thursday that a Barclays account had been opened and that the funds would be transferred from America into their solicitor's account. They would then be forwarded to the club.

A member of the Leeds board talked with Sainsbury on Thursday and received no indication that there would be a problem with the transfer of the £25m by the deadline.

But by 1300 GMT on Friday Nova's solicitors were "unable to confirm they have received funds, nor that funds are on their way or that they have been able to verify the HSBC documents received earlier in the week".