Mt Vesuvius erupts destroying Pompeii
Financial administration looms large for the club if they do not find a buyer by tomorrow. It’s getting closer to D- Day as the EPL has refused to step in and help the stricken club.
This excellent article gives a blow by blow account of what administration entails. It is by no means the end of this proud club but if done right a carefully structured way of getting out of this hole. Call it the 12 step recovery process for the financially insolvent.
In footballing terms, administration carries a 9 point deduction which leaves Pompey with barely a pulse in the Premiership. The restructuring will likely begin away from the klieg lights of the top league, in the far less intrusive Championship.
The financial recession has also forced the British tax authorities into a more aggressive stance in recovering money owed. Pompey’s tax bill has hastened the process into financial ruin as the HMRC is joining the queue for reimbursement. First senior debt will have to be retired, in this case banks like Barclays that loaned money, clubs that are owed transfer fees, and player wages. Balram Chainrai and HMRC will have to wait to get their dues.
Portsmouth will be allowed to sell players outside of the transfer period, get an advance on the TV receipts, restructure loans, and more importantly for the club and the appointed court administrator look for a buyer.
Meanwhile we can examine the factors behind club’s rack and ruin, be it living beyond its means, a lack of suitable infrastructure, and a coterie of empty handed owners. However, in Pompey’s case the league’s fit and proper test failed miserably. The EPL should stop wiggling its hips furiously (courtesy Arundhati Roy for that line) at every available investor who then turns out to be nothing more than a snake oil salesman.