Leeds United relegation rivals Burnley driven by ‘significant’ financial blow if they go down
One of the key relegation rivals for Leeds United, Burnley, are facing a “significant” loan repayment if they go down, The Athletic reports.
The £65million loan taken out by ALK Capital to take over the club with a leveraged by-out in 2020 currently only requires interest repayments, but relegation would bring the repayment schedule forward at the worst time.
Since sacking Sean Dyche the Clarets have shot out of the relegation zone and now sit above Leeds on goal difference, following a run of three straight wins.
That has dragged Jesse Marsch’s side right back into the battle for survival, having previously looked as good as safe.
But the drastic move to sack Dyche has certainly had the desired effect.
Where as the former manager dropped out of the Premier League once at Turf Moor before bringing the club straight back up, that apparently wasn’t an option this time, which makes more sense in light of the news about the loan.
Significant
According to The Athletic “dropping out of the Premier League would move the repayment schedule forward — with a significant proportion of the capital loan value required shortly after the end of the football season.
“That would be a significant blow to the club’s finances. If Burnley are relegated TV revenue, which makes up a huge part of their revenue, would decrease significantly and their cash in the bank has already decreased from £80 million to £50 million.
“If Burnley remain “in a continuing relegation scenario” , according to the accounts, they would have to pay a further “significant” section of the balance.”
The club apparently declined to comment when approached by The Athletic.
Although their owner Alan Pace has insisted that plans are in place for if they do go down, this has surely motivated them to make the moves that have so far paid off in a big way.
When Andrea Radrizzani made the decision to remove beloved manager Marcelo Bielsa and replace him with Marsch it looked like it had done the job of keeping the club safe.
But now that the rivals, who looked previously dead and buried, have followed suit the pressure is back on.
It would be a crushing blow to drop back into the Championship at this stage but the club should not be facing the same sort of financial peril if they do.
Fellow strugglers Everton’s money woes are also well documented, and after their win over Chelsea (1 May) are in position to put the Whites into the relegation zone if they win their game in hand.
It would be a bitter irony if the urgency of financial catastrophe were to drive those two clubs out of United’s reach, but the stakes appear to be higher in both of their cases.
In other Leeds United news, Adam Pope couldn’t believe what he was seeing from one Whites man who has upset a lot of fans.