Portsmouth Demise A Warning to All Premier Clubs


Portsmouth FC have been forced to go into administration with estimated debts of around £55M – unbelievable.

This is the very first Premier League club that has entered administration since the Premier League was formed back in 1992.

And surely this will be a stark warning to those other clubs who have huge debts, to get their financial houses in order, and quickly too.

It seems like Portsmouth have started the process of administration and that will be completed tomorrow in the high court.

The administration (bankruptcy in the US) gives the club a chance to restructure their debts so they can survive as a club.

Portsmouth will suffer a 9 point penalty and will therefore have their points total reduced to just 7 points and they will be relegated for sure, since they will be 17 points behind 4th bottom Hull City with only 12 games to play

We were told this week that 18 of the 20 clubs in the Premier League are in serious debt, and the total debt of those 18 clubs is an amazing £3.5B.

And it appears the bigger clubs are those that have the most debt,  including Manchester United, Chelsea and Liverpool.

Newcastle fans seem to have been fairly happy that the Newcastle finances seem to be under better control than in the past, although we are still losing around £500K a week, which puts pressure on the Tyneside club being promoted in May.

These debts that the PL clubs are carrying just cannot continue, and somebody needs to come in and tell them to sort themselves out – and quickly.

The financial management of most of these clubs seems inept – at best.

But the big losers in all of this are the faithful Portsmouth fans, who have been badly let down by those who have been running the club over the last few years.

Shame on those who have brought this demise onto a proud club.



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42 comments so far

  • Tim

    Feb 26, 2010 at 2:57 PM

    Comment #1

    so does anyone know how much debt we are in? i think ashley has done a great job in sorting out our finances and although he his not funding huge transfers, i would rather have a club of low profile players than have no club at all!

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  • BeeGuy

    Feb 26, 2010 at 3:39 PM

    Comment #2

    3 things here:
    1- The 1/2 million a week needs to be clarified. Does that include debt carried over from previous owners. or was that wiped out by MA when he bought? I’d expect money is going out faster than coming in (but that is to secure promotion, so it is a good deficit-as long as it works) and that is the number that is most relevant to me. From that, one can project PL finances, and just what can be spent at the club without “doing a Portsmouth”. I’d also like to know if the 1/2 million a week mentioned is the same as the 25 million reported to be put in during the transfer window. It would be a bigger concern if it takes an extra 50 million beyond box office & TV receipts to get through the year, rather than the money put in during Xmas. If you need an extra $50 million over what comes in, then next year’s PL TV revenues and higher ticket prices will still not balance the books.
    2- The news reports Portsmouth has a payroll of 600 employees, so I’d like to know what MA has whittled away so far in getting the off pitch payroll to a level comensurate to income. (IMHO it would seem impossible to keep 600 people busy at any fc.)
    3- Isn’t it time that all clubs be given the right to refuse promotion, if earned? No matter what some club mights do, they will never have the stadium or fan base to make a go of it in the higher leagues. Should they not get a financial reward if they choose instead of moving up to take a financial and on-pitch beating?

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  • geordie_india

    Feb 26, 2010 at 3:49 PM

    Comment #3

    Feeling sad for Portsmouth but will be happy to see aston villa gets into administration as they kickd out us badly with no respect to our fans..waiting for the hand against them next season,so we can crush that f**kers!!!

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  • Whumpie

    Feb 26, 2010 at 3:59 PM

    Comment #4

    Let’s not get complacent here – we have debts too – but mostly to our owner instead of banks. We’re on anything but a sure footing and would have gone the Portsmouth route months ago had Ashley not guaranteed to plug the revenue gap out of his own pocket.

    I’m no fan of the man, but to do that and still refuse to sell players on millions a year takes some stones. We didn’t “do a Leeds” because our owner didn’t do what the Leeds owners did – or had to do.

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  • OHurley

    Feb 26, 2010 at 4:10 PM

    Comment #5

    I’ve noted an interesting observation over the past couple months. And EVERYBODY seems to do it. It’s gotten to the point where it cracks me up a little.

    People seem to be giving a disclaimer such as, “I’m no Ashley fan BUT…” and then proceed to compliment the man’s business strategy time and time again.

    Of course only time will tell, but I think we may have a good owner on our hands, boys. Perhaps his early mistakes weren’t mistakes at all (other than his awful lack of communication), but sound financial decisions based on stabilizing this rather large club and making it self-sufficient (or as close as possible).

    I, for one, support what he’s doing right now. I hope that we can continue on the same path. I’m VERY interested to see what next transfer window will bring. If we add at least three good, solid premiership players (a quality striker, a creative CM, and a out-n-out winger capable of playing on either side) and a couple solid backups, MA has done a stellar job and given us everything we need to succeed.

    Hopefully then, people will support the man. You gotta admit, he’s got some serious stones to put up with all the public criticism for so long and still quietly maintain his course (which is obviously keeping the best interested of Newcastle United in mind).

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  • Whumpie

    Feb 26, 2010 at 4:22 PM

    Comment #6

    OHurley

    I’m no Ashley fan, BUT…

    I think you’re dead right. It doesn’t wipe the slate clean, but this season he’s done the business. Keep this up and he could just rehabilitate himself for the majority of fans.

    I don’t trust him or like his methods… but he works in professional football. How many decent, honest people work in football??

    Apart from Chris Hughton, that is…

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  • OHurley

    Feb 26, 2010 at 4:26 PM

    Comment #7

    Whumpie-

    Agreed, m8. Professional sports is right up there with government in terms of corruption. And I frankly don’t trust ANYONE who has a bank account over 10mil. But MA has dang sure done the business this year and I hope he keeps it up. He’s shown us that despite everything else, he’s shrewd with money. I can’t EVER see us going into serious debt, much less administration, with him at the helm.

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  • chuck

    Feb 26, 2010 at 4:30 PM

    Comment #8

    The EPL has at present a debt level greater than the combined debts of the following leagues Spain ,Italy, Germany and France and possibly a few more leagues.
    How did this come about and is it sustainable ?
    Well we have seen the first PL club go into administration, (Chapter 11 bankrupcy in the US) and looking at the highly leveraged financial shape of many top clubs (especially those without the backing of Oil rich Arabs or Russian Oligarchs) the Man. U`s. and Liverpools for instance, it`s difficult to see them continue as viable business, never mind building new stadiums.
    It`s time either the EPL or EUAFA instituted
    a fiscal regulatory system to prevent this crazy
    unregulated monetary madness to continue.
    Either that or we may see a collapse of the entire league, due to the same relative levels of indebtedness as those of Lehman Bros. and the other Wall st. banks that so recently crashed and burned.

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  • OHurley

    Feb 26, 2010 at 4:37 PM

    Comment #9

    Chuck-

    Spot on, m8. I’ve been sayin’ this for awhile. And I COMPLETELY AND WHOLEHEARTEDLY agree with UEFA setting the financial regulatory system.

    For instance:

    If you want to play in Europe, your club MUST conform to these specifications.

    I dunno, makes sense to me.

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  • MacToon

    Feb 26, 2010 at 4:37 PM

    Comment #10

    I’m no Ashley.

    Can’t and don’t believe what’s said about our club finacially, whether we are in debt or in credit!

    We budgeted for 25K attendances this year and average 42K and we still owe £500K a week?

    We’ve sold about £40 million in players recently without much spent in replacements and still owe £500K a week?

    I don’t know what to believe but I know I cannot believe Ashley.

    How much is promotion worth? £30 million? £40 million?

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  • MacToon

    Feb 26, 2010 at 4:40 PM

    Comment #11

    lol, I’m no Ashley 🙂 and no Ashley fan!

    Seems to me though he’s just gambled his way through the last few years with this club and he’s gambling again with it’s future.

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  • estechco

    Feb 26, 2010 at 4:52 PM

    Comment #12

    I’m not entirely convinced by this 500k a week business.

    Down: TV money £50m, Gate money (£6m?)
    Up: Wages reduction £34m, Parachute payments (£11.5m)

    Have I missed anything?

    This is before the lucrative sales of Given/Martins/Bassong/Duff etc are taken into account too

    Creative account me thinks!?!

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  • OHurley

    Feb 26, 2010 at 4:52 PM

    Comment #13

    yeah, but I believe MA loaned 25mil to the club as a personal interest free loan. If you average that out over a season, it equates to just below 500k per week. Makes sense to me.

    And gambling ain’t necessarily a bad thing. It’s not like he’s gambling the club itself. He’s still relatively new to football club ownership. I’m sure that after he’s been here a couple more years, he’ll know better about what he’s doing. I think it’s ok to give him a shot. We were faced with the drop last season not so much because of him, but because of Fat Sam and others like him who systematically ruined our football club over the course of 5 or 6 years. Ashley bought a lump of coal, and it’s just taking some time to polish it up into a diamond. With any luck we’ll get there soon.

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  • estechco

    Feb 26, 2010 at 4:55 PM

    Comment #14

    Why would he do that then, unless the club was also losing £500k a week last season too?

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  • Marty-Toon

    Feb 26, 2010 at 4:56 PM

    Comment #15

    I understand Man U and the big clubs being in debt because of the new owners,although they have a massive income on shirt sales and match tickets and the sale of RONALDO`S.
    Pompey on the other hand haven`t spent huge cash on players as far as i know but having a smaller stadium affects the income.
    BIG WAGES are the problem and we are at least tryin to do somethin on that front.
    Fat Freddy was steering us in the dangerous direction…
    Souness being allowed to spend 6 mill on Boumsong being 1 rediculous signing(he was a free agent 2 years before)
    The club was really badly run at the time so we are being carefully structured at the moment 🙂

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  • Roy Cropper

    Feb 26, 2010 at 5:00 PM

    Comment #16

    i’m no ashley fan & if i had a gun i’d shoot the fat b@stard.

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  • cupiddstunt

    Feb 26, 2010 at 5:53 PM

    Comment #17

    Aren’t we lucky you do not have a a gun? Ya mug

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  • Thump

    Feb 26, 2010 at 6:05 PM

    Comment #18

    Such a shame. Really feel for the Pompey fans now.

    You lot need to listen to what OHurley’s saying here – Ashley added to our relegation, but he certainly didn’t cause it. We all look at relegation starting from when Keegan walked out but that just isn’t true. We’ve been on this slippery slope since SBR was sacked by FFS and horrendous financial decisions certainly did us over in the long run (ALL of our sponsorship money on Owen? Now THAT is what I call a massive, massive gamble).

    Look at our managers, for crying out loud! Kevin Keegan, Kenny Dalglish and Sir Bobby Robson to name a few. All top tier managers (two having managed the national team), and they could never quite go that final mile, even though they definitely had it in them.

    Take Dalglish.

    20 months after being made manager FFS sacked him. Don’t get me wrong, I’ve heard many of the inherited players (Ginola etc) go on about how they felt Dalglish was more interested in making his own team rather than continuing with the one that Keegan left him, but that’s neither here nor there. 20 months isn’t long enough to make a massive impact unless the gods are smiling on you, but yet he was sacked because of two draws! Who did the wise one bring in?

    Ruud f**king Gullit. Sure, FA Cup Final. Great, happy with that… but the way he treat his players was complete BS (not giving Rob Lee a number, his treatment of Shearer etc) and downplaying the Tyne-Wear derby (and losing it for us!) was a disgrace.

    Don’t blame Ashley for relegation, he fell with us. If you want to blame anybody, have a look Jesmond way and watch for the Shepard’s fireworks and hope that one of them turns out to be a Javelin missile.

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  • MacToon

    Feb 26, 2010 at 6:32 PM

    Comment #19

    Hang on hang on, Ashley had us heading for relegation until a certain Mr Keegan came in and steered us clear.

    Learning nothing, Ashley had us in another relegation battle the following season, gambled by leaving the squad dangerously thin and started his mass sale of talent from the team, realised his gamble was loosing, draughted in Shearer to try n save the day.

    More money than sense this Ashley guy!

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  • Mr Books

    Feb 26, 2010 at 6:44 PM

    Comment #20

    I’m no fan of Ashley…

    NUFC has debts which are more than double those of Pompey. The good news is that they are to an exceedingly rich benefactor who is actually waiving interest on the loans and has dipped his hand in his pocket and put in more. The bad news is he’s an inept pillock who plays roulette with the club ownership and has made some very bad decisions that have not caused, but certainly contributed to us being where we are.

    Whats actually the saddest thing, is that with the exception of us being bought out by the current Man City owners, everyone who has been remotely linked with buying us out, would have undoubtedly left us in a much worse financial position.

    Regarding the 500k a week – I dont beleive that is anything other than the money he put in last December. But fair play, he put the money there and incoming players were not payed for by outgoings.

    Like just about every club in the top flight we are still in a massively precarious position. Financially I think the club is at a point where it should be slightly profitable (maybe £5M) on the running of the club. But this is before buying and selling players. If we get promoted, sure that will go up, but we do need to spend to strengthen if we are promoted – then you get back into the problem of trying to convince a creative midfielder to come in, but expect him to accept a wage at 20% of what Nolan and Smith are being paid. Even keeping Guthrie happy at 50% of what his backup are getting paid. The good thing I hope that will come from this is that the big salaries will at least stop growing, and hopefully come down to more sustainable levels.

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  • Roy Cropper

    Feb 26, 2010 at 7:11 PM

    Comment #21

    plenty of support for fat boy on here – it’ll all end in tears again 🙁

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  • Roy Cropper

    Feb 26, 2010 at 7:13 PM

    Comment #22

    netto shopper @ 17 – except in your case i’d gut you like a fish with a blunt knife.

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  • TOONPIPES

    Feb 26, 2010 at 7:52 PM

    Comment #23

    I am a fan of MA and have been from the start .. dont get me wrong, hes made some mistakes – D.wise didnt work out etc, but his basic principles make a ot of sense + it is noticeable how many ‘fans’ are now starting to recognise that it is difficut to argue with what he is doing .. everyone seems to think that MA is wrong for wanting to make cash from the business that is football – like that there is an alternative owner out there who just wants to shower money on the club without a care in the world and that wil magic another Aan Shearer and Ginola out of the air ………… slowly people starting to get a grip on reality and long may it continue ……. fact that MA refused to get carried away with paying over the odds for Beckford was wicked … hes good, but hes worth about 1.75 mill no more …. if cant get him, then look elsewhere … get another bassong make another 900% profit on a player … reckon he cud sell collicini too high wages, get some cash back in .. i’ll be disapointed as Collo starting to look good … but i cudnt argue with him if he did sell him …

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  • TOONPIPES

    Feb 26, 2010 at 7:56 PM

    Comment #24

    @ Roy Cropper .. why will it end in tears? …. when has it ever not ended in tears when a manager / chariman leaves a club … whats your alternative – like realistic alternative to a multi billionaire who blatanty wants to make money back (ie, will do everything to make the club suuccessful becos that is the ony way he will make money), and knows how to make cash and not get f cuked over on contracts … hes learning about football but he knows about business … tell me .. i’m all ears ..

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  • OHurley

    Feb 26, 2010 at 8:26 PM

    Comment #25

    Toonpipes @ 24:

    Well said, m8. Anybody that can fault a business owner for trying to make money is an outright fool with no conception of reality. Do I think MA could have made some better decisions in the past? Sure. Do I think he’s learning? Yes!

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  • Mr Books

    Feb 26, 2010 at 8:32 PM

    Comment #26

    ToonPipes – agree with a lot of you say but i dont think he did take it seriously to start with, and he’s no longer a multi billionaire – he knows how to lose cash too!

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  • OHurley

    Feb 26, 2010 at 8:32 PM

    Comment #27

    Thump-

    Thanks for the support, m8! Good on ya!!

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  • Mag 48

    Feb 26, 2010 at 8:34 PM

    Comment #28

    West Ham, Southamton, Portsmouth all in financial trouble ex manager? Harry Rednap.
    Also answering tax evasion charges?
    Who was Ashley’s first choice as manager?
    Lucky or what?

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  • OHurley

    Feb 26, 2010 at 8:34 PM

    Comment #29

    Mr. Books-

    Just out of curiosity, did you have money invested in the stock market when it went into terrible recession? Have you ever lost any money? If ya think he LIKES losing money, you’re bein foolish, m8. Sometimes, sh!t happens and there’s nowt to do about it but stoically move on and make the best.

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  • OHurley

    Feb 26, 2010 at 8:35 PM

    Comment #30

    Hehe didn’t now about Harry’s tax evasion charges. I need to keep up with the headlines better!! Sad to see that as I always respected the bloke. Great footy manager.

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  • TOONPIPES

    Feb 26, 2010 at 8:45 PM

    Comment #31

    He might have lost cash but so has everyone else so on balance/proportionately he stil just as rich as he was before .. blv you me, his reported losses will be way overstated – he wil have cash all owah that nee one knows about ..

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  • OHurley

    Feb 26, 2010 at 8:48 PM

    Comment #32

    Toonpipes-

    Like I said, I don’t ever trust a man with over 10mil hahaha. Of course, nobody needs to know about his private finances. As long as he keeps our ship floatin (and winnin!!) I’m satisfied.

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  • Mr Books

    Feb 26, 2010 at 8:53 PM

    Comment #33

    OHurley – No – I saw it coming and sold all of the stocks I had in July 2007 and held cash. Not a great deal, but saved a thumping. I did have a flutter on Northern rock not being nationalised, but only to the tune of a grand. Really wish I had bought gold and I also held on to stirling because I thought the euro would crash more than it did so missed out on a couple of ways to make a profit there. I was lucky enough to be traipsing back and forward accross the atlantic at the time and took advantage of the strong pound against the dollar at the start of 2007. I also bought back into Barclays 2 years ago as they are clearly the only british bank with a solid balance sheet, having got damned lucky with RBS forcing them out of the ABN takeover. There was one point I thought I was in the shit, because two of the biggest clients of my (thats my as in I own it not my as in I work for it) company are Goldman Sachs and Morgan Stanley – and for a week in 2008 I thought they really could go bust and that would have put me out of business. Now Ironically I’m sat in a NYC office block helping the company that took over the company that took over ABN merge all of the asset management compliance systems together.

    Now I didn’t say he liked losing money – I’m sure he hates it, but like all multi millionaires he’s willing to play for high stakes. One of the chips he has is NUFC – that troubles me a little. But not as much as the alternatives.

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  • TOONPIPES

    Feb 26, 2010 at 9:17 PM

    Comment #34

    Brooks – not sayin that NUFC is not a bit of a play thing, but it is possibly also a bit of a passion for him, and he will feed his passion … the toon knuckle heads going against him might have just sparked the competitive fires and there is probs a bit of him that just wants to prove them all wrong ….. can easy see him selling up, however, reckon he will want a bit of cash back first and for that we need to be in the prem … for a few years ..

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  • TOONPIPES

    Feb 26, 2010 at 9:18 PM

    Comment #35

    P.s HSBC deposits / loans ratio still attractive ..

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  • Mr Books

    Feb 26, 2010 at 9:38 PM

    Comment #36

    Toonpipes – Like I said, I agree with a lot of what you said. I think he has realised after last summer’s debacle that a) he paid way over the odds for the club. b) if we he wants to get close to getting his money back the club has to be viable as a business.
    He is learning – last transfer window was well managed.
    But inspite of his still vast wealth, he has lost proportionally more than most. The other thing he has done is blow a whole load of cash (nearly £900M), so while he may still be worth a lot, turning that worth into cash is no longer so easy.

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  • TOONPIPES

    Feb 26, 2010 at 9:45 PM

    Comment #37

    I dont think its that hard to make cash owning NUFC

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  • Mr Books

    Feb 26, 2010 at 9:58 PM

    Comment #38

    Well stump up the 250 Million to pay him off and get cracking lad :o)

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  • TOONPIPES

    Feb 26, 2010 at 10:05 PM

    Comment #39

    Yes Brooksy nice one, my point being that yes hes lost cash, yes he has a lot to make up, but he also has a totally compliant customer base who will buy owt and a sugar daddy called sky +, irrespective of what you say, hes still got plenty enough cash, having got himsef in position to take advantage of that, to get em moving AND most footall clubs are still run on amateurish basis .. all he has done so far is sort out the verrrrrrrry basics, like not overpaying, and hes already turning it round ….

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  • Roy Cropper

    Feb 26, 2010 at 11:32 PM

    Comment #40

    piss stain @ 24 – take your tongue out of your fat mates ring for a minute & i’ll tell you exactly how it will end in tears.

    we get promoted & your pal blubber man decides to
    put the club up for sale (again) for some laughable price , your wanna be gay lover can’t sell the club (we’ve been there done that got the t shirt) & two minutes before the transfer window closes you propose to him – he excepts & takes the club off the market (again zzzzzzz ) pledging his undying love for you & the club – with no new signings we stuggle all season & by the end of march 2011 it’s confirmed that we are relegated back to the fizzy – due to the stress your gay husband has a fling with one of his yes men – del boy – & throws you out.

    because your ex doesn’t get f cuked over on contracts – his pre-nuptial agreement/contract is water tight & you get sweet FA.

    now put your hands over your – all ears – stamp & scream as much as you like , but it ends in tears.

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