A recent report by insolvency firm Begbies Traynor has revealed that 6 English league clubs are currently in serious financial distress.
The Red Flag Alert Football Distress Report is produced every 6 months and looks into the financial situation of football clubs. The most recent report illustrates that at the end of October 2013 no fewer than 6 clubs in the Championship, League One and League Two were facing serious financial distress. One such club is Coventry City whose financial plight had been well publicised in the previous report of March this year.
The problems are being largely attributed to floundering attendances in the Championship downwards caused by the increases in ticket prices and other associated costs of attending a football match. As the gulf between smaller clubs and bigger clubs continues to widen, serious financial problems are predicted for some smaller clubs as we head into the next calendar year.
At the other end of the spectrum, it was announced at the weekend that Leeds United were expecting new investment. The Yorkshire club has signalled its intention to use such funds to invest in new players in the January transfer window. This emphasises the fact that there are still investors out there and with the financial situation in the Premier League more lucrative than ever following the new TV deals, clubs are doing all they can in order to get back into the top flight.
Here at Farleys, our football solicitors act for a number of individuals and clubs in both the North West and further afield, from those at grassroots level right through to those in the Premier League. If you have any legal issues relating to football or sports in general, do not hesitate to contact us today in order to discuss your options with one of our specialist sports lawyers.
By Daniel Draper, Sports Lawyer