In the first of a week-long series on how coronavirus will change football we talk to Peterborough’s owner Darragh MacAnthony
David Hytner – The Guardian
The horsemen are circling and for Leagues One and Two the apocalypse is nigh. For Darragh MacAnthony, the owner of Peterborough, the day of reckoning will come in July or August, when payments deferred during football’s pause can be put off no longer. VAT and PAYE will have to be settled; suppliers and, for some clubs, players and members of staff will need their money.
Everyone is trying to imagine how things will look and function when the Covid-19 pandemic eases and the predictions have been bleak, particularly for tiers three and four in England. The Championship, too, faces uncertain times. There is a grim acceptance in some quarters that clubs will go to the wall.
At League One and Two level, matches behind closed doors feel like a hospital pass, with the logistical costs to get them on surely outweighing the revenues generated. Could clubs expect to raise enough money from streaming deals for online viewers? Like everybody, MacAnthony has heard the talk that the season will be called off – even if he does not want it to be – and ghost games without supporters will be a feature for much of the next campaign.
But MacAnthony is a doer rather than a man to simply throw up his hands and wail. This is a time for action and, if preventative steps are taken, he believes the English Football League can “rescue the situation and come out of it stronger without losing clubs”.
The straight-talking Dubliner outlines his survival blueprint with liberal use of the f-word. To him, the practice of factoring holds the key. Factoring is essentially a type of loan system, whereby money contractually due in years to come can be advanced for the payment of a penalty or fee. The borrower then adjusts his or her business plan in the years that follow to save the money and repay the loan.
The EFL is in the first of a five-year broadcast deal with Sky worth £595m and what MacAnthony suggests is that the governing body brings forward the bulk of the monies due in years four and five in exchange for paying a penalty to the broadcaster of, say, 10%. It could be sold to Sky as a discount on the contract.
MacAnthony says Peterborough will need about £1.6m “come August time to pay all the bills that have been deferred” during the shutdown and he would like the EFL to create a relief fund of about £170m to bail out clubs in the Championship, League One and League Two who have short-term cash-flow problems.
The EFL could have someone in charge of the fund who would make the payments to creditors on behalf of the clubs so unscrupulous owners could not exploit it. Furthermore, any club that drew down on the fund would pay interest – “maybe 8%,” says MacAnthony – and they would return the money in instalments over the following seasons. This would be given back to Sky and, by the end of year five, everybody would be square.
“All we’ve got to do is factor an amount of money,” MacAnthony says. “We’ve got contracts for years to come and we should be able to advance that money, build a fund, protect the clubs and get through all of this. I’m not asking for government money. I’m asking us to use our financial brains, to factor money on a business that is successful world wide.