Thursday, 17 January 2013
Swindon Town could go into administration to reduce debts
Swindon Town Football Club could look at administration in order to reduce its debts thought to be in the region of £13m. It has been reported that the owner, Andrew Black of Betfair, is unwilling to put in extra funds and is looking for a buyer or investor for the club. In effect, money is very tight and they may have to try and trim their monthly playing budget of £250k. Part of the problem was because the overspent on players and wages last season leading them to eventually breaking football rules and so incurring an embargo on transfers. Having said that, they have been very successful and were champions in League one and on one measure the club is in the top 30 richest football clubs in England.
Swindon Town are likely to appoint accountants to restructure their finances and look at administration as an option if they are deemed to be insolvent. Of course, the problem with administration for football clubs is they will suffer a 10 point deduction.
Owner Black was part of a consortium which took over Swindon in 2008. A board meeting has been called for Saturday, with several external parties understood to be interested in purchasing the club.
Why do football clubs get themselves in such a financial pickle?
Simply they are not operated as proper businesses and the constant change in clubs fortunes/owners and playing success means they do not tend to conform to normal business practices.