Southend United stave off administration in Sainsbury's deal

by Rachael Singh

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03 Aug 2010

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Southend United FC avoided administration in the High Court yesterday after it reached a repayment deal with HM Revenue & Customs following a winding up petition from the tax office.

The High Court ruled existing debts at the club had been settled and future payments would be made on time.

HMRC petitioned at the High Court on 8 July for a winding up order at Southend United, and for the appointment of administrators over a £238,710 tax bill.

Chairman for Southend United Ron Martin said a deal had been made due to a partnership with Sainsbury's, the BBC reports.

HMRC warned Southend United they would take the club to court again if the club failed to make future payments.

A spokesman for the tax office said ensuring tax is paid should be at the " centre of football's business strategy" as it should with all businesses.

“HMRC doesn’t initiate insolvency action against football clubs - or any other business - lightly but we will not hesitate to do so when that is the right way to protect the country’s tax revenues and other creditors from those who trade whilst insolvent and run up debts that they simply cannot pay,” the spokesmand said.

The deal with Sainsbury's includes building a new store on the Roots Hall site with the club moving to another stadium.

Chairman Martin said all costs at the club for the next 12 months had been " underwritten".

Further reading:

HMRC calls for administration at Southend United

HMRC tackles Premier League football creditor rule

Football League agrees Stockport sale out of administration

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Financial Planning and Performance AnalystCabinet Office-Greater London-Competitive

 
 
 
 
 
 
 
 

 

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