Scott 5Portsmouth Financial Crisis
January 20th 2010 23:12
This is one issue that has taken 100s of twists and turns and sadly appears to not be getting any better for Portsmouth.
It had been apparant to everyone for years that Portsmouth were overpaying their players and then manager Harry Redknapp. Considering they don't attract enough sponsorship and they rarely get into Europe and also playing at a stadium with nowhere near enough capacity (only 20,000), there were real concerns as to how Portsmouth were surviving.
This was made clear when owner Alexandre Gaydamak was looking to sell up. He had helped Portsmouth assemble a squad which won the FA Cup and qualified for the UEFA Cup (now Europa League). Facts at the time were that they bought in
Looking at this, there was no way they could be financial viable but upon the selling of Portsmouth, it became clear there was a heavy tax bill which had been left unpaid. New owner Sulaiman Al Fahim took over in July 2009 promising that he'd bring money into the struggling club but what he delivered was nothing short of tragic. Wages weren't being paid, debts couldn't be afforded, what was Al Fahim actually doing? Public messages became confusing and no-one really knew was was going on. After 6 weeks, Al Fahim sold to Ali al-Faraj and this was the 3rd owner in 4 months.
Under Ali al-Faraj it has been an absolute disaster. Wages unpaid, crippling debt, a nasty tax bill, transfer embargo, Portsmouth have been right up against the wall from the word go. Yet, no-one has heard or seen Ali al-Faraj since he decided to buy the club.
It has gotten so bad that Portsmouth are being served with a winding up order. This would mean a 9 point deduction and certain relegation from the EPL.
On field it's been a disaster. Losing the opening 7 games and seeing Paul Hart sacked to be replaced by Avram Grant. Grant is up against the wall. He can't buy players and any players he sells, he can't replace because money would be filtered to pay off other debts.
How the hell was this allowed to occur???
Well I think the Premier League have some real explaining to do in this regard. How is it, that any tom, dick or harriett is allowed to pass the Fit and Proper Persons test? More importantly, what the hell is the fit and proper persons test? Fit and Proper Persons Test
In a nutshell this is to make sure the person is honest, competent and capable and hasn't been subject to any investigations (both business and criminal). I think this is a dreaful way of assessing ownership.
What the English Premier League need to be asking is this:
- How much money can you put into the club?
- Do you have the skills required to manage the club?
- Do you have an understanding of the debts the club currently has?
- How are you going to help pay off these debts?
- Do you have a plan to return the club to fnancial stability?
Don't get me wrong, it's important to make sure they're honest and competent but the 5 questions above are imperative.
This is an absolute disgrace. While it's hard to sympathise with Portsmouth because they brought this on themselves (i.e. not paying tax bills or paying clubs for transfers) you also have to be a little sympathetic because the Premier League have offered no help at all.
With a winding up order due to go to court in the next month, I think that Portsmouth are in real strife and there may be no way out for them. The only thing they can do is take the 9 point deduction, relegation and rebuild the entire club and prevent something like this from happening. Meanwhile the Premier League can explain how they allowed incompetent peope in charge of the club.
It'll be a sad day if a Premier League club is relegated due to financial mismanagement.
Links that helped me with this story
Portsmouth happy to bid farewell to Sulaiman al-Fahim - Guardian.co.uk
Sulaiman al-Fahim becomes Portsmouth chairman after £60m takeover is given green light - Times Online
The Independant Man United Supporters Trust
EXCLUSIVE: Portsmouth still facing financial ruin over unpaid tax bill
Read more: Really Long Link
- The Daily Mail
It had been apparant to everyone for years that Portsmouth were overpaying their players and then manager Harry Redknapp. Considering they don't attract enough sponsorship and they rarely get into Europe and also playing at a stadium with nowhere near enough capacity (only 20,000), there were real concerns as to how Portsmouth were surviving.
This was made clear when owner Alexandre Gaydamak was looking to sell up. He had helped Portsmouth assemble a squad which won the FA Cup and qualified for the UEFA Cup (now Europa League). Facts at the time were that they bought in
£65 million through tickets sales, TV money and merchandising, though £60 million of that is swallowed up in staff costs with a further £20 million is due in deferred transfer fees by the end of the season
Looking at this, there was no way they could be financial viable but upon the selling of Portsmouth, it became clear there was a heavy tax bill which had been left unpaid. New owner Sulaiman Al Fahim took over in July 2009 promising that he'd bring money into the struggling club but what he delivered was nothing short of tragic. Wages weren't being paid, debts couldn't be afforded, what was Al Fahim actually doing? Public messages became confusing and no-one really knew was was going on. After 6 weeks, Al Fahim sold to Ali al-Faraj and this was the 3rd owner in 4 months.
Under Ali al-Faraj it has been an absolute disaster. Wages unpaid, crippling debt, a nasty tax bill, transfer embargo, Portsmouth have been right up against the wall from the word go. Yet, no-one has heard or seen Ali al-Faraj since he decided to buy the club.
It has gotten so bad that Portsmouth are being served with a winding up order. This would mean a 9 point deduction and certain relegation from the EPL.
On field it's been a disaster. Losing the opening 7 games and seeing Paul Hart sacked to be replaced by Avram Grant. Grant is up against the wall. He can't buy players and any players he sells, he can't replace because money would be filtered to pay off other debts.
How the hell was this allowed to occur???
Well I think the Premier League have some real explaining to do in this regard. How is it, that any tom, dick or harriett is allowed to pass the Fit and Proper Persons test? More importantly, what the hell is the fit and proper persons test? Fit and Proper Persons Test
In a nutshell this is to make sure the person is honest, competent and capable and hasn't been subject to any investigations (both business and criminal). I think this is a dreaful way of assessing ownership.
What the English Premier League need to be asking is this:
- How much money can you put into the club?
- Do you have the skills required to manage the club?
- Do you have an understanding of the debts the club currently has?
- How are you going to help pay off these debts?
- Do you have a plan to return the club to fnancial stability?
Don't get me wrong, it's important to make sure they're honest and competent but the 5 questions above are imperative.
This is an absolute disgrace. While it's hard to sympathise with Portsmouth because they brought this on themselves (i.e. not paying tax bills or paying clubs for transfers) you also have to be a little sympathetic because the Premier League have offered no help at all.
With a winding up order due to go to court in the next month, I think that Portsmouth are in real strife and there may be no way out for them. The only thing they can do is take the 9 point deduction, relegation and rebuild the entire club and prevent something like this from happening. Meanwhile the Premier League can explain how they allowed incompetent peope in charge of the club.
It'll be a sad day if a Premier League club is relegated due to financial mismanagement.
Links that helped me with this story
Portsmouth happy to bid farewell to Sulaiman al-Fahim - Guardian.co.uk
Sulaiman al-Fahim becomes Portsmouth chairman after £60m takeover is given green light - Times Online
The Independant Man United Supporters Trust
EXCLUSIVE: Portsmouth still facing financial ruin over unpaid tax bill
Read more: Really Long Link
- The Daily Mail
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