With the prediction by Lord Triesman, head of the Football Association, that the current global economic crisis could spell a ‘terrible danger’ to clubs with spiralling debt, meaning could we actually see a Premier League club go to the wall? According to Triesman the Premier League is currently in £3bn worth of debt so the possibility is looming ever larger.Triesman’s prediction comes on the same day when West Ham’s chairman and major shareholder, Bjorgolfur Gudmundsson, saw his Icelandic bank Lanksbanki nationalised and he was sacked from the board.
Despite reassurances that Gudmundsson’s assets are spread out and that this won’t effect West Ham you do have to start to wonder whether even the foreign investor can save the over spending Premier League club. Lord Triesman’s predicts that Manchester United, Liverpool and Chelsea account for nearly a third of the £3bn worth of debt so are even the big clubs safe from financial ruin?
Well you would have to say Chelsea and Manchester United will be fine what ever the global economy throws at football but Liverpool seem to be being hit hard. Liverpool Chief Executive Rick Parry has tried to play down claims that the credit crunch has meant the Reds won’t be able to build their new stadium on Stanley Park for perhaps a year.
The club are riddled with debt after the takeover by George Gillett and Tom Hicks but they are not the only ones. A while back there was a story that Michele Platini only wanted clubs who were debt free to compete in the Champions League and Uefa Cup. It turned out that only three clubs, under Platini’s rule, would have been eligible to compete. According to one report those clubs were Stoke City, Newcastle and West Ham, although I feel that may have changed now with the Toon’s ownership dilemma and the Hammers looking like they might have to fork out up to £50million in compensation to Sheffield United.
So could we be on the verge of seeing a Premier League club go to the wall? Well it’s rare to see a club go out of business in any level of football so you would have to think not but perhaps it might be the end of large transfers. That is apart from Manchester City, whose owners have more money than sense and if things carry on as they are in the economic world City could be a good bet to win the Premier League a few years down the line. However looking at the story of West Ham’s foreign owner in financial trouble you even have to wonder if outside investors have enough to save the Premier League.
There is a real possibility that we will have big clubs like Leeds United be financial ruined by over spending and end up being stuck in the lower tiers of English football. This is a very pessimistic outlook but things are very worrying for everyone and it looks as though football will not escape unscathed.
The Premier League can not continue in the same way it has been going on for the last few years and the effects of the credit crunch can already be seen in the stands where there are a growing numbers of empty seats. The Premier League’s bubble is going to burst, it just seems like most club are not ready for it and it will have disastrous consequences for owners and fans alike.
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