Administrators have moved into Swindon Town Football Club in an attempt to save the ailing outfit, amid revelations that it is almost £7m in debt, with little or no money in the bank. It is the latest in a line of clubs to hit the financial buffers.
The club’s debts include millions of pounds in directors’ loans, £400,000 to the Inland Revenue and £200,000 in VAT bills. London-based administrators Kroll, Buchler & Phillips who have moved in to aid the club, have revealed their initial aim is to ensure the club has enough money to survive until the end of the season in May.
It will then attempt to build a platform using a ‘sound business plan, based on realistic potential achievements.’
This includes plans to budget for life in the second division next season and methods of exploiting club resources.
Part of the survival tactics may include the sale of its County Ground stadium, on which it holds a 13-year lease, a move which will certainly upset Swindon’s fans.
But Lee Manning, a KB & P partner and Swindon Town administrator, said if a substantial bid came in for the lease from a property developer for example, ‘it would have to be considered.’
The Swindon situation is one that is becoming ever more common and follows similar events at Portsmouth, Crystal Palace, Luton, Oxford, Millwall, Barnet and Chester.
All have teetered on the brink but remained alive – and not since Maidstone in 1992 has a club been forced to resign, unable to fulfil its fixtures.
Think of football and many picture the Premier League, sell-out crowds, multimillion pound transfers, TV revenue and hugely rewarding European competitions. For some that is the reality – it is estimated Liverpool, Manchester United, Arsenal and Chelsea generate more revenue than the whole of the Football League.
But for the majority including Swindon, who play outside the Premier League, they can only dream of such surrounds – and this seems to be where the problems begin.
Manning believes it may take one large club to be unable to move out of administration before anything is done to reverse this trend – while clubs need a radical overhaul of the way they trade.
He added: ‘A lot of the blame for the financial mess a number of football clubs find themselves in must go to creditors such as the Inland Revenue for tolerating non-payment.
‘They allow clubs to build up substantial debts without doing anything about it. This does clubs no favours at all. In fact this method does them a dis-service and they should start to place pressure on club directors to face their responsibilities at the outset so they then cut their cloth accordingly.’
Roger Messenger, a partner at Harley Street-based chartered accountants Wilks, Head & Eve specialises in rating football clubs including West Ham, Chelsea and Arsenal.
He believes the trend for ‘rich white knights’ investing their own money in clubs will come to an end.
He warned: ‘The supply line of individuals willing to pump their own money into clubs will run out one day. The only way for clubs to survive is to diversify the way in which they raise revenue and they should also invest money into home-grown playing talent.’
In chasing the Premiership dream, Swindon has paid inflated prices believing large transfer outlays would bring the desired results.
Instead, Swindon has creditors hounding at the door.
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