Graham Simpson remains "quietly confident" that Watford will be able to finance the development of the new East Stand, despite admitting that the club have spent the majority of the £50m generated over the last two seasons on salaries and that talks with prospective buyers have gone cold.

The Ukrainian mulit-millionaire, once the front runner to buy the Vicarage Road club, and a Thai-led consortium are both understood to have both cooled their interest in mounting a takeover of the Hornets, leaving Simpson and fellow board members Mark Ashton and Andy Wilson with the task of finding ways to raise the money to build the new 5,000 seater stand, erase a bank debt of £3.7m and sustain the club, which operated at a loss of £4.17m for the six month period ending December 31, as a business.

"I am quietly confident (about the East Stand)," said Simpson. "I am not going to be banging the drum and saying, We are going to do this and this by then and then'. But I do believe there are a number of different avenues, from grants to sensible business loans, that we can raise the money. We are looking at that closely but I'm not going to start giving dates."

Simpson said the club are in discussions with the bank with regards to the bank loan due within one year that stood at £5.1m in December.

"We've got an overdraft facility with the bank which we'll now talk to the bank about going forward," he said. "Let's be absolutely clear we all know financial times are not wonderful in the world so we will have to make sure that our bank is completely comfortable how we are operating and what our budgets are going forward.

"We'll go to the bank with our plan for the next one or two years. We have to take into account what we are going to do in the second year if we don't go up because that's when the parachute payments stop."

Since being promoted to the Premiership two years ago Watford's total income has been in the region of £50m. Some fans have questioned how that money has been spent and how the club now finds itself in debt.

"It's a fair point and I can understand people asking it but when you do go up to the Premiership all the salaries are hiked up amazingly," he said. "But then when you go down the salaries don't go down anything like what they went up.

"You do do a reduction but you'll get agents coming in saying other clubs are interested in their player, they won't accept that reduction and you have to renegotiate.

"Where has the money gone? A huge amount has gone on salaries, I'm afraid. Where else has it gone? We've put money into the ground, we've put money into the training ground, the infrastructure and a bigger management team. It hasn't gone on me going out having a good time, it just goes. I can understand people asking, but salaries are very high in football and it's a great deal of money."

With just one season of parachute payments to come - around £11m - and operating expenditure for the six-month period ending December 31 standing at £15.7m, Simpson is now preparing to cut the club's cloth accordingly by implementing Plan B. Player sales appear inevitable if the club are to generate sufficient income to keep the club self sustaining.

Boothroyd is understood to have been told he needs to raise £6m in fees.

"(Plan B) is not in full swing but it's in swing, of course it is," said the chairman. "Plan B isn't a blueprint I'm going to come out with so the fans can read it.

"Plan B says we have to tighten our belts and that we can't keep all of our players. It's not going to be drastic cuts but we have had discussions with Aidy about this.

"We have told Aidy how much we need to reduce the wage bill by and there is an amount we would like back for transfer fees. How he does that is his business. He knows what he needs to do and is now thinking about how to do it.

"We will always be a club who will need to sell our key players, unless we have a benefactor who comes in and takes a hit."

Much to his disappointment Simpson was unable to report any positive developments on negotiations with potential buyers.

"I am bound by the rules of the Stock Exchange but there are no developments whatsoever," he said.

"I know I looked a bit silly when I denied it but that was the truth then. Since then nothing has moved forward and, if anything, developments have gone quiet since.

"A cash injection would be very welcome and would help this club continue to punch above it's weight and get back into the Premiership," the chairman added.