Tom Davies gives us our regular update on clubs in crisis
A huge debt to the Inland Revenue is hanging over the future of Grimsby Town, a now wearily familiar legacy of the ITV Digital collapse and some profligate spending in the late 1990s. The Mariners owe the taxman £700,000 and, as WSC went to press, the club were in final negotiations with the Revenue in a bid to find an acceptable repayment schedule. The League Two club have already had two such offers turned down this season, with Town chairman John Fenty complaining that the terms the IR were putting forward were unaffordable. Failure to reach agreement this time could land the club in administration.
A Keep The Mariners Afloat appeal has been launched, in conjunction with Grimsby’s supporters’ trust, to raise £420,000 within two years and Fenty is planning on raising the rest through board contributions and day-to-day trading surpluses. Historic debt aside, the club are currently trading solvently.
But belts are going to have to remain tight, which is more than they were in the late Nineties, when the club, then in Division One, converted to plc status and made many of the free-spending blunders that afflicted so many clubs in the top two divisions at the time. Two subsequent relegations and the ITV Digital collapse hit Grimsby more than most clubs in the basement, leaving Town saddled with expensive player contracts and a compound loss of anticipated income of around £5 million.
Fans of Swindon Town are more familiar with financial turmoil than most. The club have been in administration twice this decade, emerging from their second spell in August 2003, but at the end of January they were slapped with a winding-up order from Customs and Excise because of an overdue VAT payment, a bill that the club somehow forgot to mention at their recent annual general meeting. Customs and Excise have been taking a firmer line with football clubs since the removal of their preferential-creditor status and Swindon suddenly found themselves in need of another urgent short-term rescue, not least because the players received only around half their wages for January.
Swindon were bailed out this time courtesy of long-term Swindon benefactor Sir Seton Wills and the developer St Modwen, with whom the club is involved in discussions over a stadium redevelopment scheme, but in the long term fans know a more stable future needs to be established.
Loans from the wealthy Wills family, whose fortunes were made in the tobacco industry, have long shored the club up, but, as Andy Ratcliffe of the Swindon Town Supporters Trust told WSC: “We have relied on them for investment but at some point in the future those loans are going to have to be paid back.”
Swindon are putting their hopes in proposals for a comprehensive redevelopment of the County Ground and its surrounds, in conjunction with St Modwen, which would involve either retail or housing alongside a revamped 20,000-capacity stadium. The club is likely to submit a full planning application to Swindon Borough Council, which owns the ground and with whom relations have not always been that cordial, in the summer. It’s a familiar vision, but how such a new ground will be financed and run, and for whose benefit, are key questions to be resolved.
There’s some tentative cause for optimism at Stockport County, where constructive negotiations are taking place to enable the supporters’ trust to take over the club. County have been sharing their Edgeley Park ground with the Sale Sharks rugby union club, who moved in two years ago when millionaire Brian Kennedy’s Cheshire Sports company bought both County and Edgeley Park and installed the Sharks at the ground.
With County proving a less-than-productive investment, Kennedy has been looking to extricate himself and last month he contacted the trust himself to ask them to produce a business plan for a takeover. The trust is fortunate in that it can boast a certain amount of wealth and business experience on its own board, such as the club’s main sponsor Steve Parfitt. Though such a takeover is unlikely to effect any dramatic reversal in Stockport’s declining fortunes on the pitch (for which Sammy McIlroy’s disastrously profligate spell as manager is still widely blamed), it is seen as the most desirable option.
A glance at some of the alternatives may explain some of the faith placed in this move: one of the other rumoured interested parties is John Batchelor, famous for fiddling in York City while the club almost burned two years ago and whose spell at Bootham Crescent very nearly resulted in the death of the club.
The chances of Stockport regaining ownership of their ground in the near future are altogether slimmer, however, which still leaves the club in a potentially vulnerable position, but for the moment supporters can at least be heartened by the friendly state of relations between Cheshire Sports and the trust, if not by the club’s situation on the field, where relegation to League Two appears inevitable.
From WSC 218 April 2005. What was happening this month