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Tuesday, 19 January 2010

Portsmouth Fails to Block Winding-Up Petition: First Premier League Club to Fail?

Portsmouth Football Club failed, in its High Court action today, to stop a winding up petition being heard on 10th February 2010.

Will the club be the first Premier League club to fail and fall into administration we wonder. As the petition hearing nears will the club find the funds to meet the alleged £11m of tax debts. Some £7.5m of VAT is said to be owed which the club disputed today.

What will happen when the petition is formally advertised in the London Gazette, will the company's bank freeze the bank accounts? This is the normal response to an advertised petition.

What happens then - will the players get paid or will the directors take the obvious step and appoint an administrator?

Usually, for a football club, the exit from administration is to propose a company voluntary arrangement.

See link here to what is a winding up petition guide for background reading.

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