Terraloon

The club entered into a 4 year agreement with these lenders in 23/24. Then they entered into another agreement to advance the KDH fees. Its abundantly clear that the club is struggling to generate enough cash to pay for day to day expenses let alone dip too far into the transfer market I can’t see how the money will ever be paid off without seeking further finance agreements . But the problems come home to roost big time if promotion isn’t achieved in 25/26

You don’t count the losses you count the expenses into account and of course they won’t be able to do that going forward. But I am not saying my logic will be exactly how it pans out but we know that CFC ladies will now be run independently. The woman’s team at Chelsea don’t own a stadium, a training ground, an administrative structure etc so will be reliant on CFC ltd to provide such services but no doubt they will be invoiced for them going forward. So let’s say the owners charge a fee per game for use of the stadium , the costs etc for stewarding, a set fee for CFC to provide administrative support, a fee for the training ground etc. let’s say all the costs say are £10-15 million. CFC previously claimed it cost say £10 million but now on a commercial basis charge 50% more and no doubt being a related party transaction will need to professionally quantify and no doubt will be able to come up with a number which won’t see a reduction and in view of the fact that there isn’t any PSR in woman’s football the owners will not give a toss if the woman’s team keep making losses

Sky suggested, yes suggested, that it happened today because wages were paid today meaning his compensation won’t be due to the end of July.Is that at cash flow issue? That of course may be the case. But as has been pointed out already if his employment ended today then the cost should be reflected in the 30/6/25 numbers. Why now? If the payment needs to be in the 24/25 numbers then it should have happened earlier If it needs to be in 25/26 then why not delay it till early next week. Would you put it past the club to account for it when the payment actually is made as opposed to the period his employment ended? Are the 24/25 numbers that close to the wire or who knows perhaps they are better than being predicted if so back to my question why delay it till now ? It may of course be that the 25/26 projection due on 30/6/25 is the worry in that if it’s paid in 25/26 the numbers won’t balance and with that the EFL could well impose other and earlier sanctions

In effect King Power own them all .

I think far too many misunderstand what has happened here. Their WSL team and the hotels were owned by Chelsea FC Ltd. Chelsea Ltd were owned by Chelsea Holdings Ltd who in turn are owned by Blue Co Ltd. So the assets , save 10% of the woman’s team, are still owned within the same structure. Before Blue Co was in existence just about all the Chelsea Assets were owned by a company called Fordstam which was Roman Abromovich ownership vechile Man City owners actually sold a % of their holding companies shares to a Chinese Company. Isn’t that far more of an issue ? Tottenham Stadium isn’t owned by the Football club its a standalone within the holding group. All that we see here is normal inter company activity but as for scuppering themselves not sure realistically in 10 years time any woman’s team will have a value over the sum but irrespective Chelsea’s Woman’s team can’t function without Chelsea FC Ltd support and infrastructure and almost certainly there would be significant financial kick back to Chelsea FC Ltd .

I think we need to wait for just a little while yet till we can claim that with any authority. The PL arbitration panel ruled that in their opinion the PL did, for 22/23 have jurisdiction but they didn’t have the authority to overturn the appeal panels ruling that they didn’t. That ruling cleared the way for the PL to bring charges for 23/24 which they have now done but the ruling re 22/23 can not be overturned. Bear in mind that means that Cities arguments that at the end of the 22/23 financial accounting year the club wasn’t a PL club and that the club was a EFL club. Put all that together and it is possible that the appeal panel’s incorrect interpretation will be relied on to enable the EFL to bring charges for 22/23 . Will charges be forthcoming? Far from sure any will but fear that the PL arbitration ruling may well facilitate action by the EFL

The PL did indeed have jurisdiction to investigate and pursue but what is key is that the main charge, ie the PSR one, is actually under the EFL rules. That really is key because the IC conducting the proceedings will rely on EFL rules and sanctions for that charge. What we shouldn’t loose sight of is that the EFL will be looking at the numbers for 22/23, 23/24 and 24/25 If the numbers suggest that a charge is appropriate then the concern will be the EFL will lodge another charge. The question of jurisdiction will be key . In other words will the EFL charge LCFC using the PL rules. Bear in mind there isn’t the clarity in the PL rules around double jeopardy but, the second Everton commission did make allowances in that respect As I posted yesterday if the allowance for period ending 24/25 is £105 million that’s one thing if it’s £83 million it really will be squeaky bum time. But what really is the biggest threat is the how T-2 ( 23/24) T-1 (24/25) which will be the accounts in draft or as close to the actual s and T (25/26) which will be estimated. If the losses for those come out at over £145 million ish then there is a real possibility that the EFL will impose a set of in year sanctions in all likelihood the imposition of an embargo Back to those numbers T-2 was £19 million, I estimate T-1 at £80-85 million so any projected loss over £ 40 million in 25/26 and it’s that which will be as much of an issue when the bookies are setting the odds

Just got back into the UK and catching up. I said a week or two ago I had put some numbers re 24/25 We know that the loss in 23/24 was £18.9 million My guess is that income will be slightly higher than predicted here at £178 million. So some £73 million extra on top of the 23/24 numbers. According to the 23/24 accounts player trading profit was £71.841 million not “about £50 million “also let’s not forget the £12.73million compensation for Maresca and staff. Combined that’s £84.5 million that won’t be repeated in 24/25 unless major player sales take place in the next 30 days . I doubt it so at this time I will use that number I agree that amortisation will be in the £60 million ball park.which is around £17 million more. Wages will almost certainly go up from the 22/23 number of £93 million .It won’t be as high as 22/23 that’s for sure but my guess is that it will be at least £130 million so plus £37million. Thats being very conservative and I suspect way under when you add in Coopers pay off. So to the £18.9 loss for 23/24 we need to add/ subtract the following +£73 million income growth -£17 million amortisation -£37 million wages -£84 .5 million non repeating transfer profit/ My estimate is the loss currently is looking to be between £80& £85 million for 23/24. So Looking at the 22/23, 23/24 and the 24/25 estimate the losses of £89.5 million + £18.9 million + £80 million I am projecting over the 3 year period is at least £185 million deductibles of £3x £29 million . So £98 million over . But I havent factored in any cost increases elsewhere when I am sure there will be some. Will the allowances be £105 million or £81 million? The question of jurisdiction and under which set of rules apply for LCFC post 1/7/25 really is a complication Its going to be very close. Hopefully wages haven’t grown by more than than £37 million because that really is the key to it all

I haven’t posted anything positive because in truth a I am struggling to see how this will end in anything but tears. The impact of Everton’s deductions and possible compensation is still on going but whereas the initial claims were being made by 6 clubs, including LCFC, the matter and rulings to date have eliminated 5 clubs from having grounds to claim and that club is Burnley. It’s quite possible if Man City get found guilty then a whole queue of clubs will be seeking compensation My point I was trying to make is that is in the gift of any IC to decide on compensation.It might or might not happen but it’s in the process The written reasons will be published once the IC has issued them. Funnily enough relegation isn’t one of the sanctions available to a PL commission. A massive points deduction if one is awarded may bring about relegation and as a consequence the EFL would have to accept them as a club but if Man C get expelled then there isn’t a requirement that they be accepted by the EFL be it in the Championship or indeed even at Division 2. There is / was nothing stopping City making a claim for compensation .

The breach save a few weeks was in the period 1/7/23 - 30/6/24in effect the championship season hence why the PL charged LCFC using the EFL rules. Neither the EFL or the PL will , save a giving a view, have input into the final outcome. Of course the ICs findings and sanctions can be appealed but that applies to both club and the respective leagues. At 30/6/24the point that any breach would have crystallised LC were a PL club and as we know fell under the jurisdiction of the PL . Indeed if you look at the case that the club argued previously their submission was that after the PL share transfers from a relegated club to a promoted club that’s when the PL jurisdiction begins/ends. I am not sure how De Marco can now be arguing that a different approach should apply particularly as an Arbitration panel has now ruled on the fact. There will be a debate as to who now prosecutes the case. My concern is it will revert back to the EFL to finalise for two reasons 1) LCFC will be a EFL club and 2) It was there that the initial investigation started in March 24. If it doesn’t then it will be extremely interesting as to how any sanction flows to the EFL. If you remember the EFL ( via Trevor Birch) initially and then very quickly withdrew the suggestion that they had the rules in place to do just that .They didn’t! I haven’t tracked any subsequent EFL amendments but the suggestion was that following that realisation in late 23 early 24 that the EFL rules would be amended. In reality if the EFL take over the matter then there in my mind is little room to argue . As I said before I think the PLs charges around submission of accounts and non co operation are there as much as anything to illustrate aggravating factors. I honestly take the view that the “ victories” that the cub won weren’t the ones that really matter and all that has happened is that the day of judgement will now come when the likely impact will be far more damaging and the impact will be over a longer period . By that I suspect that a 24/25 charge under the PL rules is a real possibility but the expedited process means that it is likely in the 25/26 season.That means it is a real possibility that the 23/4 matter will likewise see a sanction in 25/26. But the real kicker could be if the EFL deem that a business plan is appropriate for 25/26 and unlike 23/24 the rules are now in place to ensure that should the league require one then the club have to supply the appropriate information to facilitate formation of one.

If you look at the process from issue of a charge, it’s not really called that but for all intents and purposes that’s what it is, there are quite a few stages that have to go through each with a set period within. For instance even at the first stage club have 14 days from the issue of the charge sheet to respond . There are still a significant number of stages before an IC will even start to consider matters one is where the club will have sight of the PLs case and the once a response is prepared the PL will have time to consider the clubs response. My point is that it takes months even in an expedited process to get to the commissions written reasons being shared with the PL/Club and even at that stage it’s possible that there is more weeks no months needed to hear an appeal and even potentially arbitration. Whilst the PL can( very unlikely at this stage) offer a settlement that offer if agreed by the club still has to be put before an IC to agree. Time is very much against this process. The last league games of the season are today as we all know. The league rules state clearly that the season ends at Midnight on the date that the last league game is played. That’s key because I can’t see any authority that allows a points deduction post midnight tonight and that is confirmed in the section dealing with an insolvency event post 25/3/25 where any points deduction/ sanction is made in 25/26 and for information if a club in the PL is unfortunate enough not just to be in such an event and also suffers relegation whilst still a PL club the sanction follows them to the EFL. The last bit of bad news is that if subsequent to the seasons end an IC panel finds that one clubs indiscretions has led to a final loss to another member club then they can award compensation as part of the process. In other words if say a points deduction due to be suffered in 24/25 didn’t happen till 25/25 a club such as Ipswich could be awarded say £3.5 million even if the league table isn’t altered.

The Premier league wanted the Everton case dealt with in season but Everton had made an application to have it delayed. The PL objected but the IC ruled in Everton’s favour and as a consequence it was delayed till the following season.

That’s to a degree what confuses me. You want him to be correct but now I have posted extracts from the respective rule books and read then several times unless I am missing something I just don’t understand his perspective.

If all the club is looking to gain from the sales is the amortisation remaining and maybe a reduction in wages then you know that there is trouble ahead

It does. It’s far from easy to predict what 22/23, 23/24 & 24/25 combined will look like but we do know that 22/23 and 23/24 losses were £109 million and that the PSR excess was £35 million +£13 million. So some £61 million over when deducting allowances maybe £30 million (2x£15 million) & depreciation of £8 million (2 x£4 million) so by my very much back of a fag packet calculation the 24/25 loss can’t be in excess of £12 million otherwise another charge is likely for 24/25

The problem in both Daka and Bouba cases are their valuations will already be negatively impacted by the fact their contracts only have one year left. Personally I think the writing was in the wall by the fact that JV wasn’t offered a new deal. Ok age was against him but he would have done a very decent job in the EFL so either there are plans to bring in someone younger , better, cheaper or for some other reason and by my calculations that has to be his potential cost going forward was too much and his contract ending was an opportunity in terms of overall wage reduction that couldn’t be missed It’s important to remember that for the 3 year cycle ending June 26 the allowable loss can’t exceed £61 million

Possible but I simply don’t think there would be any appetite from either the PL or EFL to offer any sort of Olive Branch and should there genuinely be proof that the breach was subsequent to a rule change then the IC would grant some sort of mitigation on that point

It seems that most, and to be fair understandably, made the assumption that because City weren’t charged back in January that the club hadn’t breached PSR for 23/24. At the time a joint statement with the PL was issued in it the following was perhaps a key indication that a charge was likely to follow: "Accordingly, neither the League nor the club will make any further comment at this stage about any aspect of the club's compliance or otherwise with any of the PSR or related Rules, save to say that no complaint has been brought against Leicester by the League for any breach of the PSRs for the period ending Season 2023/24." The more I read that the more I realise that there clearly was an issue with the numbers and all that would save a charge for 23/24 was if jurisdiction was denied. It was clear that at that point City could almost certainly have agreed that 23/24 needed to be dealt with and quite possibly agreed a sanction but that window has now and truly closed. I personally think the notion that a points deduction can happen in 24/25 is folly . Although I can’t find immediately a cut off date for any points deduction at seasons end I believe that precedent lies elsewhere namely there is a cut off point if a club entered an insolvency event. This is all going to untangle and almost certainly at pace. The question of what now comes following the charges is one thing but the bigger question is what do the 24/25 numbers look like and of course how the EFL interpret those numbers for the 3 years to 24/25 ( I am far from sure if there was a significant wage impact in 24/25 as a consequence of bonuses earned in 23/24 but but paid in 24/25 ) and what the projection for 25/26 looks like.

Read this

How would it be an PL IC if jurisdiction is transferred to the EFL ? My reading is that if it’s passed back to the EFL it’s dealt with under their rules and regulations Whilst the expectation is that any PSR matter within the PL jurisdiction would be dealt with under their expedited procedure within that process the pro exists to vary the timeline detailed within Here’s the PL rules re the expedited process remember that there are two other charges one is in respect of LCFC not sending in the 23/24 accounts by 31/12/24

He maybe correct in the point that any PL can’t hand down punishment to be implemented in the Championship. My point here is that LCFC are now to be relegated and by my reading if the two set ups ( EFL and PL ) agree jurisdiction can be passed to the EFL to deal with under their rules and regulations

What you are overlooking here is that the final legal ruling on the rules wasn’t in accord with LCFCs view . Indeed the legal error lays with the appeal IC ruling in the clubs favour. The only reason that the club weren’t charged for 22/23 by the PL isn’t because the Premier Leagues rules didn’t cover its because there really weren’t grounds for the arbitration to conclude that process wasn’t followed by the appeal panel As for City the PL the investigation did indeed take far too long but City did everything they can to delay matters indeed even challenging the PLs right at the High Court to put a matter to arbitration ( which they , City, lost) None of the City charges fall under the expediaited process.

The PLs expedited process was put in place in an attempt to ensure that any PSR charges were filed within 14 days of the 31/12 date . That date is set because it’s the final date by which clubs have to submit their accounts. Bear in mind LCFC have been charged for not submitting their 23/24 accounts by that date. In the PL rules around charging clubs by that backstop date ,a date that was deliberately set to enable ICs to deal with the case and should there be an appeal there is provision to vary that date if circumstances require a delay. See appendix 1 page 545 https://resources.premierleague.pulselive.com/premierleague/document/2025/04/11/12d05df7-ce74-43ac-9766-1f3c3594da74/TM1603-PL_Handbook-and-Collateral-2024-25_11.04.25_DIGITAL.pdf I would imagine that the PL made application here and almost certainly were granted permission to delay the laying of charges meaning the imposition of any sanction in 24/25 isn’t a factor here

Looking at the written reasons of both Everton’s charges and the Notts Forest case mitigation isn’t just given on the nod the expectation is that sending in say accounts and other supporting documentation and indeed engaging with the PL aren’t grounds in themselves for sanctions to be mitigated it goes far deeper. Maybe winning an appeal will help but bear in mind the charges are for 23/24 whereas the appeal was about 22/23. The charges around failure to submit the 23/24 accounts by 31/12/24 and failure to supply information and assistance to the PL to me doesn’t suggest that LCFC assist even to a basic level let alone over and above The failure to submit and engage charges are key because and are there to send a message about non cooperation. The non filing date is a matter of fact and whilst the failure to engage may well to a degree be subjective any panel looking at claims re migration and aggravating factors won’t be able to ignore these claims. The 22/23 “ loophole “ isn’t anything other than the club can’t be charged by the PL for 19/29+20/21 averaged + 21/22 and 22/23 the horrendous 21/22+22/23 numbers will form part of the charges dropping off the two Covid years and replacing them with 23/24. If you think the EFL and PL aren’t going to try and send a message here then sorry I think you are miss reading what’s going on here . As for the IC who ultimately decide on any sanction they won’t be able to look at the 22/23 debate all they will do is focus on the numbers for the 3 years in question and decide based on the facts of this case and factor in aggravating and mitigating factors. The point here and as I said yesterday don’t be at all surprised if the EFL take over jurisdiction once LCFC becomes one of their clubs. Maguire is right that any Premier League IC acting probably can’t pass down a points deduction but an EFL IC taking over the case and who are dealing with charges under their rules almost certainly can impose a points deduction.