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2020 has been a strange year for nearly every industry, but the future of English football has fallen under the spotlight as the true impact of the Covid-19 pandemic comes to light four months on from the UK officially entering lockdown.
Finance in football has been a rising concern for years, with much debate through the last decade of the ever-expanding margins between the Premier League and the English Football League’s lower divisions. 
While the financial woes of former top-flight regulars Leeds United and Southampton saw both clubs slide into the third tier — League One — were well catalogued, it was Bury FC’s untimely demise in August 2019 that really brought the issue of football finance back to the fore just days before the current campaign commenced.
In this article, we will look at the impact of Covid-19 on the professional game, the threats to the future of clubs that have been around for over 100 years and the avenues of support available to clubs who find themselves on the brink of liquidation.

Football without fans

The coronavirus pandemic brought the UK economy to a halt back in March, and although most sectors are gradually returning – in some form – to a sense of normality, the consequences are only starting to rear their head now. 
For football, one of the major challenges to restarting the season was an assurance that no fans would attend matches, keeping transmission rates to a minimum and ensuring health and safety measures could be maintained as far as practicable.
Taking the average attendances for clubs in the current campaign, where each fan enters with the cheapest ticket price and buys one pint, one pie, and one programme, we found that the 91 current clubs in the English league system would lose more than £305m — based on each club losing revenue from five home games until the end of the campaign. It’s a monumental loss, and that’s before you take into account broadcasting revenue, shirt sales, and corporate sponsorship. 
It’s no surprise then to see famous names teetering on the brink of administration. Bradford City in League Two, when not bolstered by TV revenue, are set to lose £2,123,250, by closing their doors to fans.
The ever-widening financial margins between the Premier League and the EFL come into sharper focus when 2018/19 champions Manchester City are set to lose £23.9m. Even for one of the richest clubs in England, this is still 84 times more than near neighbours Salford City, whose estimated revenue loss sits at £284,715.
Tickets to the Etihad will always cost more than at Moor Lane but you can get in to watch Salford for just £10, while a trip to the Etihad Stadium will set you back at least £77 — that’s seven matches more than for one afternoon with Raheem Sterling and Sergio Aguero. 
When you delve into the cost of season tickets, the disparities become even clearer. We hope they serve pints in golden goblets at the new Tottenham Hotspur Stadium, where the most expensive season ticket costs £1,995. 
In contrast, the most expensive season ticket for League Two clubs came in at £750 which was at Northampton Town, whose fans will get to watch the likes of Sunderland and Ipswich Town next season after winning promotion to League One.

Covid-19 has stripped some of the simple pleasures away from life including the little things such as the joy of a pre-match pie and pint with mates. 
The cheapest pies are to be found in their spiritual home of the North West, with Carlisle United fans tucking into their favourite cuisine for just £2, and Accrington Stanley, Blackpool, and Rochdale costing not much more at £2.50. 
Less surprising is the fact that London clubs have the most expensive pies with Chelsea (£4.60), Tottenham Hotspur (£4.50), and Fulham (£4.50), making up the top three in this league. 
A pint at Arsenal’s Emirates Stadium will burn a hole in your pocket at £5.70. For just 70p more you could buy two pints at Huddersfield Town, as they offer the cheapest pint for £3.20.
Surprisingly, Colchester United offer their matchday programme for free to loyal fans, but still face estimated losses of £413,000. Southampton have the most expensive programme, charging £4 to read their pre-match offering.
With the lost matchday revenue causing many a headache for clubs, a saving grace during the Covid-19 pandemic has been the benefit of the government’s Coronavirus Job Retention Scheme (CJRS), which has enabled the clubs to furlough staff during the lockdown period in order to reduce costs. 
However, the lost matchday revenue from seasons being cut short in Leagues One and Two and the Premier League and Championship being concluded without fans, means the true impact of the coronavirus on English football may not be seen for many months.

How did we get here?

When the Premier League was launched back in 1992, the idea behind it was for the country’s top players to benefit from a reduced calendar and give the national team a better chance of winning tournaments. 
In reality, the main beneficiaries were the clubs who not only benefited from enhanced broadcasting revenue and TV rights, with Sky TV fresh on the scene to deliver pay-to-view matches but also being able to keep 100 per cent of their home match receipts for the first time. 
Within ten years, the gap between Championship clubs — Division One as it was known at the time — had grown to such a point that parachute payments were introduced for clubs relegated to the second tier in order to mitigate the huge loss in income.
By 2004, points deductions were introduced for Premier League and EFL clubs entering administration — the process which sees creditors take control of the club to ensure that from its debts, wages owed to players and staff, and transfer fees owed to other clubs would be paid first — after some clubs were taking advantage of the process to clear debts while retaining their star players. 
Wrexham became the first league club to be hit by the deductions, with 10 points being docked in December 2004, before higher-profile cases like Leeds United and Southampton followed suit a few years later. 
Points deductions became the norm last summer as two North West clubs — Bolton Wanderers and Bury’s plights worsened. 27th August 2019 was a dark day for football when Bury were expelled from the Football League. The first team to suffer this fate during a season since Maidstone United in 1992. 

Wigan’s woe spells out Covid-19 impact  

With Bury FC expelled, the Football League was operating with 91 professional clubs when the Covid-19 lockdown cut the season short. Teams from Southend United to Macclesfield Town, and even Charlton Athletic in the Championship, had already been battling off-field complications regarding winding-up petitions owing to unpaid player wages, failure to fulfil fixtures, and controversial takeover plans
Earlier this month, Wigan Athletic became the 20th club to enter administration since points deductions were introduced, with the club citing the coronavirus pandemic as having had a detrimental impact on finances. A 12-point penalty was applied on 22nd July upon completion of the league campaign, and, although subject to an appeal from the club, the Latics were relegated to League One by two points, with Barnsley profiting from the North West outfit’s plight and escaping the drop.

Can we expect more of the same? 

Wigan’s surprising trouble brings into sharp focus the difficulty of running football clubs, from the Premier League right down to League Two. Premier League clubs are facing a £1bn reduction in revenue because of the coronavirus crisis, so it comes as no surprise that the government’s Digital, Culture, Media and Sport (DCMS) Committee has announced that it expected more clubs to follow Wigan into administration
In a report on BBC Sport, committee chair Julian Knight said: “We know that 10 to 15 clubs could find themselves in the same position. (On Monday) the DCMS Committee sought clarification from (Premier League chief executive) Richard Masters on what action it was taking to provide extra money for clubs at risk — he told us that the Football League hadn't asked for extra funding and the Premier League hadn't provided it.”
As the league campaigns conclude, the DCMS went further by calling for parachute payments to become a thing of the past, a report stating that ‘the current football business model is not sustainable’.
During the last few months, the debate around the continuation of sport and its importance in society at a time when the health of the nation is on the line, has brought varied reactions. When Boris Johnson announced the return of sport at the beginning of June, he said it would ‘provide a much needed boost’ to the nation. Some sports fans would agree. 
At a time like this, football is not just a game, it’s a livelihood — for players who might only get a 10-15 year career, for managers, for sponsors, and for all those staff working at the 91 professional clubs who all face an uncertain future.
While clubs have benefited from the CJRS and a £195m funding package from Sport England — which professional and community sports clubs can access — let’s hope teams across the country can weather the storm and line up for the start of the 2020/21 season — whenever it is and eventually with fans there to cheer them on as they have done for generations.   

Oldham athletic
Sport is a central pillar of British society. 
Not just in terms of shared experience and associated culture but also in taking part and the numerous benefits it brings through exercise and social engagements. The lockdown has been particularly tough for sports enthusiasts. 
Economically, like every other sector of the UK economy, sport has taken a big hit. We’ve previously written extensively about sport and insolvency but the coronavirus pandemic and lockdown have acted as an accelerant.
More than a game?
Not for the first time, football and it’s response to the predicament has split it down the middle. Fans, players, managers, CEOs, broadcasters, medical staff and government all have a vested interest in how the sport responds and so far it has been a little of everything.  
Non-league football up to and including the National League have declared their seasons over as has League Two in the EFL. They have completed their season using a points per game formula to obtain a final league table and have accordingly promoted the top four teams.
League One are deciding how they will proceed but seem like they will vote to finish in a similar style while the Championship and Premier League are pushing ahead to play on and complete their seasons behind closed doors. 
The government has given them permission to begin modified and social distanced compliant training this week with an expected resumption date to be June 12th under the aptly named “Project Restart”. 
Playing in front of empty stadiums will be a new experience and not necessarily a positive one. The German Bundesliga restarted this week and the experience was described as sterile and unsettling. 
Crowds are the scenery, backdrop and special effects at matches and without them the experience might not be as compelling as the authorities are hoping it will be for viewers and broadcasters. 
Finishing the season and maintaining sporting integrity are just two of the issues facing football. The financial outlook for teams in an extended offseason is another. 
Swindon Town Chairman Lee Power estimates that without immediate financial support from the government or higher up in the football food chain then 30/40% of clubs in League One and Two will be at risk of insolvency.  
This is in addition to many lower league footballers contracts running out at the end of June and some teams such as Oldham Athletic and Macclesfield Town already struggling to pay staff on time. 
Even if the season is completed in this truncated format, there will still be restrictions placed on crowds when the following season is due to start and fans might not be allowed into stadiums until at least 2021.
Football finance expert and insolvency practitioner, Gerald Krasner who has been involved with several football administrations underlines the financial imperative for restarting football at a time when less high profile industries are still locked down.
He said: “The reality is that people have managed without football for more than a month now and there’s a real danger that unless the momentum can be regained and fans can begin to watch matches on TV again, the impetus will be lost and the draw of football will be diminished in the long term. 
“Unfortunately those clubs with wealthy foreign owners may not necessarily be immune from disaster either. If that was to happen, the television money would soon desert the game too.
“Overseas owners will be forced to respond to the effects of the global pandemic on their own finances and business interests, and for some that could mean that ownership of an English football club is simply no longer viable.”
And this, regardless of health and safety, is the prime consideration for the elite of English football.
Any “one” for Tennis?
Other sports, while not taking a direct lead from football, will be at least watching closely to see how any solutions play out. 
Rugby and Cricket are looking to hold some kind of competition to avoid their 2020 seasons being written-off and Silverstone have announced that they are hoping to stage two Formula One races albeit in front of empty grandstands. 
Golf and Tennis appear to be faring better at least in terms of participation as they were also allowed to restart in the first wave of recreational reopenings recently. 
David Rickman, Executive Director of Governance with the R&A said: “We’re fortunate that golf lends itself to social distancing, so by making a few relatively small changes to the rules and the environment in which we play, we can make it safe for golfers.”
Of course most golf clubs will be operating at a minimal level initially as their bars, restaurants, golf shops and practice facilities will all remain closed. 
Additionally, a majority of staff including green keepers remain furloughed so playing will be even more of a challenge for some although the clubs themselves will welcome any influx of income. 
Now unlimited exercise is allowed, the demand for facilities will be as large as it is immediate. 
Playgrounds, outdoor gyms and ticketed outdoor leisure venues will still remain closed but one-on-one sports such as tennis, basketball or even batting and bowling in cricket nets is now permissible as long as social distancing rules are observed.
All of these changes are based on the latest best practice and advice based on the Covid-19 infection rate continuing to fall. Any second wave of infections, or worse any that could be directly attributable to a sporting event, might mean a second lockdown and further restrictions throwing any further plans into doubt. 
One of the key tenets of sporting faith is hope.  There’s always another match or season. Always the chance to start again and win this time if you’ve suffered a defeat. 
In business, administration can offer a similar hopefulness and route to redemption. A lot of otherwise good and profitable companies are finding themselves in terminal circumstances because of the Covid-19 pandemic but there could be a way for them or any business in difficulty to dust themselves down and start again on a level playing field when it’s time to go again. 
If this sounds appealing or you’d like to know more than you can get in touch with us here.  
We’ll arrange a convenient and free initial consultation with one of our expert team of advisors who can begin our dialogue. 
Once we have a clearer view of your business, it’s financial situation and immediate circumstances, we can help you plan out an effective and efficient way forward for you and your business. 

Riverside Stadium
Rumours have begun circulating that the Championship, the top division of the English Football League, are considering an unprecedented group or collective administration involving each of their 24 member clubs. 
This would mean that as well as some of the most storied and famous names in English football such as Leeds United, Nottingham Forest, Sheffield Wednesday, West Bromwich Albion and Middlesbrough potentially folding and reforming as new entities, while releasing every single one of their players, managers, coaches and match-day employees.
They would then look to re-employ them on new but reduced terms. Alternatively, they could exit from administration via a Company Voluntary Arrangement (CVA) and retain the previous ownership and identity.
Regardless what method is chosen, the rationale for what would still be a unique and staggering move, is that it would be a way of reducing outgoings and debt. 
It’s also important to remember that these scenarios are being discussed at the same time as the players PFA union are in negotiations with the EFL to agree to league-wide wage deferrals or reductions which would alleviate some of the immediate pressure on the clubs. 
Under current EFL rules, any team going into administration or suffering any other kind of insolvency event during the season is immediately liable for a ten point deduction, which as the season only has nine matches left to play, could be pivotal in promotion or relegation scenarios. 
The league would either have to waive the penalties in this case or apply them to every club in the division simultaneously so that nobody would be at a competitive advantage. 
Football also has specific rules concerning the payment of debts and the reformation of clubs at the same or a lower level
Currently all football creditors such as players, are entitled to receive 100% of what they’re owed before any new club can be launched whereas other employees or non-football creditors, such as the St John’s Ambulance or HMRC, would only receive 25p in the pound following the takeover of the club’s assets, although this could rise to 35p if repaid over a longer period.
One of the main hurdles to this plan would be reaching an agreement against the poaching of players from other teams as every player would be a free agent and legally entitled to sign for whoever they wanted, regardless of the status of their previous contract and that their registrations would fall outside of the usual transfer window periods. 
This would only apply to clubs within the EFL and there could be nothing to stop Premier League or foreign teams poaching them. Football is notorious for being based on a series of “gentlemen's agreements” rather than contractual law so this could see previous loyalties and alliances broken forever. 
1,500 EFL footballers are out of contract at the end of May or June and usually leave or are free to leave or renegotiate new deals but if the season is artificially extended into July or August then this creates obvious difficulties.  
It also raises questions of professionalism - if a star striker knows he is leaving at the end of the season regardless, then how motivated will they be to risk injury and put their body on the line in a vital relegation battle?
Several sports leagues have collapsed in the UK before including the National Basketball League and the British American Football League  but none as high profile or consequential as the Championship or any EFL division. 
Other sports such as county cricket and rugby league and rugby union are also trying to find funding formulas to keep as many clubs functioning as possible so will be looking at developments within football with interest. 
Formula One, possibly the most expensive sport in the country, is also facing an existential crisis. 
Chief Executive of McLaren Zac Brown has warned that as many as four of the ten teams set to contest the 2020 season could fold if no agreement is reached between teams and staff if racing restarts at some point later in the season. 
Nine of the 21 grand prix’s have already been cancelled or postponed and their rules state that at least eight have to be completed for a meaningful championship to be awarded. 
While the clock is ticking, Eamonn Wall, Managing Director of Business Rescue Expert is sceptical that the clubs would pursue their doomsday strategy. 
He said: “As we’ve seen previously this season with Bolton Wanderers and Bury, administrations are not unknown in the EFL and sadly there may be more to come especially if the enforced lockdown means that the season is elongated or even declared null and void.
“What would be highly unlikely is that all the clubs would enter administration at the same time. As well as the contractual chaos it would cause, there’d be lots of objections - especially from their creditors and would likely be led by HMRC.
“The PFA and EFL are still negotiating for a mutually agreed settlement which would require 75% of clubs to agree to change the EFL rules and allow this or any other collectively agreed changes to the players contracts to take place. 
“Each side is looking to gain leverage over the other - it’s a business negotiation after all - and the potential threat of multiple administrations might be enough to get the PFA and players to renegotiate their contracts, which is the main outcome that the clubs are seeking.
“It’s certainly a lot easier and cheaper for them to conclude the issue this way than by looking to launch a unilateral group administration before the season has formally concluded.”

We’ve written previously about sporting administrations and insolvencies and while they may look the same as other businesses and sectors they also have the added complexity and interconnectivity of being part of a wider association or league. 
They also have a disproportionate emotional hold on supporters and communities. 
We’ve all got a favourite shop or beer but not many of us have got that name or logo tattooed on our bodies, or can reel off the names of the previous 12 CEOs like a stanza. 
But they are businesses with employees to pay and debt repayments to meet and like any business if they can’t meet these obligations then they’ve got to make some serious choices - and quickly.
If you contact us one thing we can guarantee is that you’ll be listened to. 
One of our team of expert advisors will arrange a free virtual initial consultation with you to understand what you’re facing and to work with you to come up with an effective response.

Oldham athletic
The club owes debts of over £600,000 to Blitz’s company Brassbank and the club are due to attend a hearing scheduled for this afternoon. This morning the club were facing a winding-up petition in the High Court brought by HMRC for unpaid tax debts in the region of £70,000 which may or may not already have been set-aside at time of publication.
The Oldham Chronicle reports that a potential administrator has already been approached and Mr Blitz is keen to continue to provide backing through the administration process.  
The Football League deadline for imposing points penalties is March 26th although any penalty incurred after this date would see the team begin next season on minus points as Bolton Wanderers did this season. 
Going into administration currently incurs an automatic 12 point penalty which would effectively see the Latics relegated from the Football League for the first time since their acceptance in 1907.
The club is currently operating with only three stands open on match days as the local council has closed the North Stand over safety concerns so further financial intrigue is the last thing they’d want. 
It’s been a bleak year for North West football clubs with Bury going into administration and being expelled from the league, Bolton’s points deduction effectively guaranteeing them relegation to league two and Macclesfield Town facing winding-up petitions after staff had been paid late for the fourth time this season. 
It’s also just come to light that Southend United’s players are still awaiting their wages from February. 
Oldham owner Abdallah Lemsagam, a former players agent, took over the club in January 2018 and saw them relegated in his first season in charge. He hired former Manchester United great and Oldham native Paul Scholes to be manager in February 2019 who later resigned only seven games later claiming he had been mislead.
Lemsagam later alleged that he was making a complaint to Greater Manchester Police regarding the financial conduct of former owners including Simon Blitz regarding grant money from Oldham Council towards the building of the currently closed North Stand. 
Blitz, a US based entrepreneur, claims that the club owes £200,000 for the rent and a further £330,000 for an unpaid loan with late fees and interest accruing further debt daily.  
The club accepts it has not paid rent and under the terms of the loan Blitz has the right to appoint an administrator. 
There’s claim and counterclaim between Lemsagam and Blitz regarding various land and property deals involving the club and the local council which the hearing may shed more light on but the clear and present danger facing the club relates to it’s self-admitted rent arrears. 
Chris Horner, Insolvency Director with Business Rescue Expert, says it’s quite unusual for a business to face an administration order under such circumstances. He said: “When an unsecured creditor is pursuing a debt, they will generally seek a winding up petition. An administration application from a creditor is a more complex request.”
“Usually, as the club is already subject to a winding up petition from HMRC, the landlord could have sought to be attached to this petition or to support the petition. The administration application however means they have brought their own separate action, which could prevent the winding up petition.”
“In addition, with an Administration Order, the creditor is able to nominate the insolvency practitioner(s) who will act as administrator. With a winding up petition, the Official Receiver will be appointed in almost every case.”
Bill Shankly said that football is a simple game made complicated by people who should know better. The same can be said for running a business. 
Anything that makes profitability more difficult or impedes progress could ultimately turn into a big problem for any company. 
If you’re finding running your business is more like wading through treacle than effortlessly gliding over a wet pitch then get in touch with us. 
One of our team of expert advisors will arrange a free, convenient initial consultation to talk through your situation and help you plan an effective way forward to help you transform from relegation candidates to real contenders.

Bury FC
We’ve previously written about the sad demise of Bury FC - the 135 year-old double FA Cup winners who, in August, became the first team to be expelled from the football league during a season since 1992. 
This follows the news that Bury’s owner Steve Dale has defaulted on the company voluntary arrangement (CVA) that was agreed last summer to settle the club’s £5 million debts having failed to provide the money required to fund it.  
This means that liquidation of the club remains a certainty. A spokesperson for the administrators said: “The CVA has formally defaulted and we will now be looking at taking the necessary action to deal with the default”. 
Chris Horner, Insolvency Director with Business Rescue Expert said: “The usual procedure when a CVA defaults is that the supervising liquidator will formally petition the court to begin a winding-up of the company.
“If this happens then whatever remaining assets belonging to the club will be sold off by the liquidator - including the right to use the name Bury FC which would be of interest to supporters looking to relaunch a new entity lower down the football pyramid. 
“Of course sometimes this is impossible so recently reborn “phoenix” clubs such as Darlington, Wimbledon and Hereford United have come back named slightly differently - Darlington 1883; AFC Wimbledon and Hereford FC.”
The club’s Gigg Lane ground has a £3.8 million mortgage held by Capital Bridging Finance Solution who would effectively repossess the stadium. They could sell this to any consortium or group prepared to buy it. 
Creditors were informed in January that Mr Dale had missed the maximum six-month deadline to provide the monies to fund the CVA and had been given a 21 day extension up to Tuesday 11th February to do so or the CVA would be terminated.  
The terms of the CVA set out that football creditors such as former players and other clubs would receive their debts paid in full, approx. £1 million, whereas non-football creditors including staff and HMRC would receive 25p in the pound or 25% of the remaining outstanding debt - approx. £4 million. 
The operation of the CVA had previously been investigated by the Insolvency Practitioners Association following concerns regarding its operation but it was concluded this week having determined that there was insufficient evidence on which any disciplinary action could be founded.
Chris Horner said: “A CVA is not a ‘get out of jail’ free card for dodgy directors - over 40% fail and it requires hard work and good faith on behalf of directors to make it work. 
“They have strict conditions attached for a reason but these will hopefully allow a company to survive and restructure its debts to keep staff employed, get back into shape and eventually, profitability.”
If you feel your company might have a future if it can just get a break from its debts and obligations then get in touch with us today. 
One of our team of experienced expert advisors will arrange a free initial convenient consultation with you to go through your current situation and what your options are. 
Then they can help you plan out the most efficient and effective course of action that, if followed, could be a roadmap to recovery for your business.

Bury FC
After five league fixtures and a league cup fixture had been suspended, they were finally given a deadline of 5:00pm for the current chairman Steve Dale to provide proof that he has the money to finance the club and its debts for the current season or to satisfactorily conclude a sale. 
The most promising offer from C&N Sporting Risk collapsed at 3:00pm when they announced that due to unresolvable problems with the mortgage on the club’s ground, Gigg Lane and the overall financial state of the club, they could not proceed.  
Despite three last-minute offers being received for the club the EFL board announced at 11.04pm that Bury’s membership of the league would be withdrawn saying: “Having fully considered all available options, including a number of late expressions of interest provide to the EFL, the EFL board has unanimously determined with enormous regret that Bury’s membership be withdrawn.”
League One will now continue with 23 clubs including Bolton Wanderers who were also given until 11:59pm on Thursday 12th September to complete a sale of their club or show that it can be funded through a full season in administration or also be expelled.
Several other clubs such as AFC Wimbledon, Darlington, Halifax, Scarborough, Chester and Maidstone, the last team to be expelled from the league in 1992, have reformed lower down the non-league pyramid although only Wimbledon have returned to the Football League.
The FA confirmed that the former winners would not be eligible for this season’s FA Cup but “If the club reforms we look forward to them applying to make an application to The Football Association to re-join league competition further down the English football pyramid from the 2020/21 season.”
So how did we get here?
It’s a strange symbolism and while many millions of pounds owed led to their demise a single £1 was all it took for Steve Dale to purchase Bury FC from previous chairman Stewart Day in December 2018. 
Day, who owned several property firms, had been in charge since 2013 and took out a mortgage for £3.7m at 138% annual interest on their Gigg Lane stadium but resolving this was one of the sticking points for C&N Sporting Risk as they were unable to reach an agreement for a reduced figure to pay off the loan and release the charge. 
After selling Bury, several of Day’s property companies including one called Mederco which specialises in building student accommodation blocks, went into administration owing thousands of investors over £150m in debts. 
Additionally, there were also 250 investors who Mederco had sold car parking spaces at the stadium to at a price of £9,995 each based on speculative yields from annual rents and future events.
The club was purchased by the colourful Steve Dale, who claimed in a BBC interview that he’d never heard of the club before he bought it, and previously had a registered interest in 51 companies, 43 of which went on to be liquidated. 
Despite taking over the club and all of its assets, Steve Dale never satisfied the Football League that he had the necessary funds to sustain the club after buying it. This is a requirement of EFL rules for new owners before any takeover or at most, within weeks following one. 
You would have expected a more robust response from a governing body than ¯\_(ツ)_/¯  but the league are now shocked, SHOCKED to discover that the owner who couldn’t provide proof of sufficient financial backing could not provide sufficient financial backing.  
In July a winding-up petition brought by HMRC was dismissed by the High Court after being adjourned three previous times. 
Creditors eventually approved a CVA which triggered a 12-point deduction for the team although this also had an intriguing subplot when it emerged that a company called RCR Holdings owned by Kris Richards - who happens to be the partner of Steve Dale’s daughter - bought Mederco’s debts (and thereby its CVA voting rights), two days before the CVA meeting. Bury owed Mederco £7m so the proportionate weight of that debt gave RCR a deciding vote that ultimately allowed the CVA to pass. 
It was also later confirmed that RCR would seek a dividend from the CVA which would be a quarter of the debt owed - an impressive return of £1.75m on a debt bought for only £70,000.  
Steve Dale issued a statement saying that all dealings within the CVA had been done in the correct and proper manner but Bury North MP James Frith has written to the EFL calling for an investigation into the relationship between Mederco, RCR and Steve Dale.
The administrators will now continue to progress the CVA and arrange the disbursement of any funds to creditors while supporters wait to see what will happen to the name, ground and other assets and what they are going to do, for the next few months at least, at 3pm on a Saturday afternoon. 
The fate of Bury and possibly Bolton Wanderers proves that you need more than love, passion or even luck to run a successful business. The affair also proves that when facing hard reality, the only people you can truly rely upon for guidance and to act in your best interests are professionals. 
If your business is adrift in the bottom three and running out of fixtures then contact one of our expert advisors. 
They will arrange a free initial consultation where we can discuss what you can do immediately and in the short term to give you and your business a fighting chance of survival. 
We won’t always tell you what you want to hear but we’ll always tell you what you need to. 

William Hill
Their ads tell us that “when the fun stops, stop” and the fun appears to have stopped for William Hill.
They announced that they’re planning to close 700 betting shops all over the country with up to 4,500 employees at risk of losing their jobs. 
A spokesperson said: “The group will look to apply voluntary redundancy and redeployment measures extensively and will be providing support to all colleagues throughout the process. Subject to the outcome of this, shop closures are likely to begin before the end of the year.”
Gaming analyst Gavin Kelleher thinks this is only the beginning of a coming wave of closures and redundancies. He told the BBC: “We’ll definitely see more closures. GVC, which owns the Ladbrokes and Coral brands have said they will close up to 1,000 stores. 
“You’re also likely to see stores close elsewhere in the market from independents and potentially from Betfred so I think all told we’ll probably see over 2,000 to 3,000 shops close in the UK which is a big chunk of the 8,400 stores that are already open.”
The company primarily blamed the reduction in the maximum stake on fixed-odds betting terminals from £100 to £2 in April saying it had seen a “significant fall” in gaming machine revenues. 
The machines have certainly proved a bonanza for the industry with each machine earning them an estimated £52,887 a year - more than twice the average wage. Industry earnings overall were estimated to be in excess of £1.7 billion annually. 
One reason for the proliferation of betting shops in the UK is that while they are limited to a maximum of four FOBT machines in a single location they’re not limited to the number of branches they can open except within a specified geographical distance - but this only applies to one company. 
For example, Ladbrokes couldn’t open two stores next to each other but there’d be nothing stopping Paddy Power, Betfred or William Hill opening one next door. Nor would there be anything stopping Ladbrokes opening another location 400 meters or so up the street.
Staffing didn’t always increase as a result and in many cases some stores were left with a single operative, sometimes with tragic consequences. 
The gambling industry has always been quick to spot the next trend and make it as widely available as possible for its customers to bet on. Greyhound racing only came about as a betting alternative between horse races and the 90s and 2000s saw the rise of virtual racing - literally betting on video games. 
FOBTs were just the latest in a long line of innovations and the industry is already moving strongly in the direction of online betting through apps to allow punters to bet on the go and play other casino type games such as roulette, blackjack and virtual poker. 
This is the key to understanding the driving forces behind the current situation. 
And it’s market correction by a nose
Statistics from the Gambling Commission show that income from racecourse and bookmaker shop betting had fallen from £3.3 billion in April 2015 to £3.2 billion in September 2018. During the same period online betting jumped from £4.2 billion to £5.6 billion. 
A YouGov survey indicated that online gambling was the most popular kind with 13% of people admitting they had placed a bet online with only 11% at a live event or in a bookmakers shop. 
Former Sports Minister Tracey Crouch, who resigned from the government over a planned delay in the implementation of the maximum limit, thinks it’s too convenient for bookmakers to blame the policy. She said: “While I’m sorry to hear of job losses, the truth is there was a huge overinflation in the number of bookmakers on our high streets because of the profit-making capacity of FOBTs. It’s too simplistic to blame closures on stake changes. 
“There’s been a consolidation within the industry and a drive from bookmakers themselves to less costly online gambling for some time now and mass closures were predicted in the industry-funded KPMG report (produced to support the higher maximum limit) even without stake reductions.”
There are also other unintended consequences from these decisions. The horse racing industry itself will see a reduction in their income as they had agreed an annual payment of £30,000 per shop from each bookmaker.
Gambling itself has undergone a moral makeover in recent years with an attempt to move its image away from that of smokey, sawdust covered shops to a communal activity enjoyed by sports fan in the pubs or at home. 
You can’t watch any modern football match without being assailed by ads displaying live odds and promotions for the game you’re watching and many teams themselves are sponsored by online betting companies with LCD perimeter advertising boards displaying the latest betting information and encouragement during the game. 
FOBTs are probably going to be the highly profitable epitaph for the high street bookmaker but they will always have the opportunity to continue to make money from other gambling arenas.
Sadly, and one of the main reasons why the maximum limit was enforced, for some tragic users they became an actual epitaph. 
If your business’s survival is looking like a long shot then contact us anytime to arrange a free expert consultation. 
Our specialist knowledge, advice and experience could be the difference between falling at the next hurdle or getting back in the race stronger than before.

Bolton Bury
What if many of them regularly spend hundreds of pounds on having the same uniform as the staff or even have the company’s name or likeness tattooed on themselves?
What if the business is the primary reason the town is “on the map” and people cannot say the name of the town without adding the business’s suffix to it? Try talking about Accrington without automatically adding Stanley. Even Manchester doesn’t look right without United or City behind it. 
The businesses we’re talking about are sports teams. In many ways they are a business like any other and have incomings, outgoings, assets, liabilities, staff, shareholders and directors. In several other ways they are not businesses at all but community assets, focal points, standard bearers and ambassadors.  
One of the ways they’re similar is that they’ve still got to generate sufficient income to pay wages and bills or else they will become insolvent and this is where the first difference between a regular business and a football club exhibits itself. 
We wrote about the disaster area that the famous Bolton Wanderers have become earlier this year. Not only did they enter administration and face a winding up order along with owing millions of pounds in debt but they continue to suffer in sporting terms.   
Under English Football League rules, any club going into administration automatically incurs a 12 point deduction either taking effect immediately or if after March 31, being suspended until the following season. 
Bolton, already with the ignominy of relegation to League One, will now start on minus 12 points at least.  At least because the players, disgruntled at not being paid on time for the third time in as many months, took unilateral strike action and refused to play a match at home to Brentford. The league eventually awarded Brentford a 2-0 win rather than force the game to be played after the end of the regular season and Bolton are still awaiting the results of a disciplinary panel investigation for additional punishment for failing to fulfill a fixture. 
It’s in the league’s interest to take steps to ensure that each team fulfills its 46 scheduled fixtures to maintain the sporting integrity of the competition. Brentford were not in the promotion race but a scenario where Bolton were being liquidated would have been a nightmare for the league.  
In such instances, the results of the defunct club are expunged from the records and points won by other teams against them are taken away.  This can impact the promotion and relegation scenarios and ultimately cost a team promotion and forfeit the millions of pounds that entry to the premier league would bring. 
It’s because of these rewards that so many clubs end up gambling with their futures by paying exorbitant wages and transfer fees to try and access the financial bonanza that promotion would bring. Alongside the glamour of fixtures against the likes of Arsenal, Liverpool and Manchester United - a promoted team gets a minimum payment of £100m in TV rights every season just for being a member of the league.  
Even if they’re relegated, they’ll be due reducing “parachute payments” to help them mitigate the change in circumstances so clubs that are run within their means can survive and even thrive under a promotion/relegation/promotion cycle. 
The knock-on effect of this gold rush is that The Championship, the EFL’s top division and the one that has three promotion places to the Premier League on offer saw its members make a combined loss of over £500m last season alone. 
It’s not just football that is seeing financial fiascos engulfing famous names. Widnes Vikings and Bradford Bulls Rugby League teams and Cardiff Blues and Leeds Carnegie Rugby Union clubs are also in dire debt straits all in the pursuit of sporting glory.
They think it’s all over
Redundancies are also a different matter for a sporting club in insolvency. Star players are freed from their contracts and are able to sign with rival teams almost immediately, usually with a customary signing-on fee. Their livelihoods are secure and are also treated as football creditors when claiming back any owed wages which gives them preference over other member of staff. 
And what about the other members of staff? Ticket sellers, bar servers and Hospitality staff. Very often, they’re fans themselves and working for their club, while being a labour of love, is also a dream come true. 
They aren’t going to walk away and look for jobs with Wigan Athletic or Preston North End - Bolton are their club so it’s a double tragedy for them - personally and professionally. 
Sixteen professional football clubs have faced winding up petitions in the courts over the past two years alone. Bolton are still in administration while a sale is sought and Bury’s owner is hoping to strike a CVA deal with the club’s creditors. 
R3, the industry body for insolvency practitioners, have recently produced a briefing paper for Insolvency Practitioners on the special features and considerations of football insolvencies - recognising that they have broader dimensions than a regular retailer would for example.
R3 led a campaign in 2015 based on changing the “Football Creditors Rule” that saw the EFL amend its rules so that unsecured creditors of an insolvent club (local small businesses, service providers, St John’s Ambulance Service etc) were better protected.  
Before the amendment there was no requirement to provide any level of return to unsecured creditors, now any purchaser on an insolvent EFL club is required to pay them a minimum of 35p in the pound over three years or 25p on transfer of shares. If they fail to meet these stipulations the club would face a heavy sporting sanction - an additional 15 point penalty to be implemented at the start of the season following the insolvency. 
R3 said: “Any insolvency practitioner who takes on the insolvency of a club will be very aware of its value to fans and to the local economy, and will do their best to rescue the club’s business as a going concern. It is very rare for insolvency to mean the end for a club, which is good news for fans, local communities and towns across the country, and the sport as a whole.”
While the wait goes on for supporters of Bolton Wanderers and Bury, who will meet in an “insolvency derby” on 7 September, fans of other teams, especially in the lower leagues, will wonder who’s next. 
Insolvency Practitioners may operate under certain exceptions when it comes to dealing with sports teams in administration but they don’t operate with different rules
No matter who you follow, if your business is in the relegation zone then give us a call. We’ll give you our full support from our free initial call, helping you make the crucial tactical tweaks to tighten up your financial defence and scrap your way to survival if possible. 

Not only was the team relegated to League One, they smashed numerous records for poor performance on the way including losing 30 matches out of 46 and letting in 78 goals in the process while only scoring 29.
Things could have got even worse for one of the most famous names in English football as they faced potential liquidation in court last week so being placed into administration could be seen as a decent result for the beleaguered Wanderers.
The club was placed into administration at the request of Fildraw Ltd who are one of the creditors. They are a trust representing the family of the late Eddie Davies who was previously owner and chairman of the club before selling to current owner Ken Anderson.
In a statement they said: “The decision was finally made for the appointments (of administrators) which it is hoped will ensure the continued existence of the club, one of the founding members of the Football League.”


Bolton have become the first English football league club to enter administration in six years since Aldershot Town in 2013. The standard EFL penalty for administration is a 12 point deduction which will now take place next season meaning they will start on minus 12.
We’ve previously written about the potential ramifications of a football club being liquidated last time Wanderers were in the High Court and with other teams such as Macclesfield Town and Bury due to appear in the upcoming months it can only be a matter of time until a judge decides to blow the full time whistle on one of them.
Last week the club faced its seventh hearing under the winding-up petition in 18 months under owner Ken Anderson, this one over £1.2m in unpaid tax and VAT bills brought by an increasingly aggressive HMRC that had finally lost patience with the Trotters and several other football clubs. The club also owed money to kit manufacturers Macron, Bolton Council and several other creditors including Fildraw.
Things could actually get worse before they get better as they have an upcoming appointment in front of an independent disciplinary committee for failing to fulfill a fixture. The likely punishment will be further points deducted for next season.
The players went on strike after not being paid their wages for March and refused to play a match at home to Brentford.  The game was subsequently awarded to the Bees as a 1-0 win and the club was only able to fulfill its fixture at Nottingham Forest on the final day when the Professional Footballers Association lent the club sufficient money to pay the players.
In addition to persistently being late in paying player and staff wages, the hotel at the University of Bolton stadium has been closed and is also facing a separate winding-up petition by the HMRC while the Safety Action Group has withdrawn the safety certificate for the stadium, which means that no fixtures can take place including summer charity matches until it is reissued.


The situation is worse for other members of staff who are still awaiting April’s wages. So much so that the club has had to rely on the generosity of local businesses to set up and stock a foodbank for staff to use.
A proposed takeover from former Watford FC owner Laurence Bassini was being pursued until quite late in the process with the twice-bankrupt businessman claiming he had sufficient funds to fund the purchase of the club and underwrite operating expenses as required by the EFL as a minimum condition of purchasing a member club.
Bassini and Anderson have both issued conflicting statements with each proclaiming ownership of the club although the EFL have yet to see evidence of his financial obligations including proof of funds and a business plan.  Bassini signed a Sale and Purchase agreement with Anderson in April that was contingent on league approval but also prevented Anderson from selling the club to a third party or placing the business into administration.
The administration would appear to settle the matter.

One of the most famous names in English football faced potential liquidation and a points deduction today in the High Court but when the case was adjourned for two weeks to allow more time for a buyer to purchase the club, it would have been cheered like a goal.

Founder members of the Football League in 1888 and a Premier League club until as recently as 2012, four time FA Cup winners, home of such illustrious names as Nat Lofthouse, the Lion of Vienna, Sam Allardyce, Jay Jay Okacha , Ivan Campo and Youri Djourkaeff could legally have been no more after today’s proceedings.

The club was facing it’s sixth winding-up petition in 18 months under owner Ken Anderson, this one over unpaid tax and VAT bills brought by HMRC that has finally lost patience with the Trotters.

A consortium, Football Ventures (Whites) led by private equity investor Parminder Basran and Sharon Brittan pulled out of talks late last week so the case came to court.

Kieran Maguire, lecturer in football finance at the University of Liverpool and writer of the popular blog outlined three possible scenarios to BBC Radio Manchester on what would ultimately happen: “One is that the owner sells the club to new owners which is the most preferable. Two is that the club is put into administration to give them breathing space and allow time for new owners to come in and three that they are wound up and liquidated, which would mean they are expelled from the league and all assets sold”. In any event, the adjournment allows more time for option one to play out.

The adjournment until April 3 takes the matter beyond the league’s own cut-off date of March 28. If the club does go into administration then, they will start next season on -12 points and also have a two year transfer embargo. .

If liquidated then they would be only the third English football league club to be expelled during a season following Aldershot in 1991/92 and Chester City 2009/10. This would cause chaos in the Championship as their results are expunged and teams that had beaten Bolton would lose those points.

The club has persistently been late in paying players and staff wages and only last week the training ground was closed as it had run out of food, drink and medical supplies.

The situation is further complicated as another club, Forest Green Rovers, have instigated legal proceedings over a collapsed transfer. They loaned a player, Christian Doidge, to Bolton in January with a view to completing a permanent transfer but Rovers ended up paying the players wages from January - effectively paying him to play for another team!

Amazingly Bolton were just one of three football teams facing winding up petitions today with League Two strugglers Macclesfield Town and National League Ebbsfleet United also facing the court.

HMRC have been pushing courts to liquidate a club for some time to set an example and show football clubs aren’t a special case - or are they?

Thousands of fans attend every week and have done for generations, many more who have left the town still look out for results and watch their games on TV and for smaller provincial towns, the football club is a key community asset, bringing tourism and visitors to the town every couple of weeks and getting the town name in the national conscience through football results and coverage.   

There are also the community outreach schemes to local schools and other schemes to help promote fitness and engagement with other underserved communities such as senior citizens, the unemployed and refugees that have settled in the area.

Somebody who loves chocolate can go elsewhere if their favourite sweet shop closes down, what can a football fan do?  A Manchester United fan wouldn’t pop on the bus to Manchester City if they disappeared overnight!

Bolton Wanderers live to fight another day and prospective buyers have more time to complete due diligence and raise funds for the purchase but it can only be a matter of time until a court loses patience with a club and declares full time for their existence.


Business Rescue Expert is part of Robson Scott Associates Limited, a limited company registered in England and Wales No. 05331812, a leading independent insolvency practice, specialising in business rescue advice. The company holds professional indemnity insurance and complies with the EU Services Directive. Christopher Horner (IP no 16150) is licenced by the Insolvency Practitioners Association


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