The Press Association has just reported that Portsmouth is contemplating suing the Barclays Premier League over their refusal to lift the club’s transfer embargo so that they can at least bring in loan players during the transfer window. My view is that Portsmouth are increasingly losing touch with reality and they should be very careful how they tread, even if the law is on their side. There is an appetite out there to make an example of a club to bring home to football clubs that they cannot go on living beyond their means.
The Press Association has just reported that Portsmouth is contemplating suing the Barclays Premier League over their refusal to lift the club’s transfer embargo so that they can at least bring in loan players during the transfer window. My view is that Portsmouth are increasingly losing touch with reality and they should be very careful how they tread, even if the law is on their side. There is an appetite out there to make an example of a club to bring home to football clubs that they cannot go on living beyond their means. In the latest move, chief executive Peter Storrie told the Sunday Mirror ‘I can confirm that we have issued a legal letter to the Premier League to demand that the transfer embargo should be lifted. We believe we’ve got a very good case against them. They have absolutely no right to withhold TV money in advance of future payments to foreign clubs.’ The League claim that they are entitled to do so on the basis of rule C47. Interviewed on Radio 5 at the end of last week, Portsmouth chief executive claimed that all outstanding debts to English clubs had been paid. What sort of world is it in which one doesn’t have to settle debts to foreign clubs? They might be reluctant to sell to English clubs in future.
It is very difficult to get hard and reliable facts about the situation at Portsmouth. Mark Jacob, the executive director of the south coast club, claimed on Radio 5 that the debts were much less than the widely quoted £60m but refused to be more explicit. This led Gordon Taylor, the chief executive of the Professional Footballers Associaton to demand more information about the club’s finances and warn that Portsmouth could suffer a similar fate to Leeds. Jacob admitted that he had never met owner Ali al-Faraj. He had some difficulty in explaining his motives for owning a club that he has never seen play in person. Jacob stated, ‘He is not the only absentee owner in the Premiership. I have been explaining to him and also to his brother [who has attended matches] that there is a real need for him to come to games.’ His welcome from Portsmouth’s fanatical supporters might not be assured, however.
The Premiership diverted £7m of television money to help pay off outstanding transfer and loan fees of about £10m. The clubs who will now receive money direct from the Premier League include Chelsea, Spurs and Watford in England; and elsewhere in Europe, Lens, Rennes and Udinese. Portsmouth are also believed to owe various sums to agents. They claim that the winding-up order served by HM Revenue and Customs is based on figures for VAT are too high and they are confident that the High Court will agree with them.
One possible financial lifeline collapsed when a proposed loan deal for David James at Stoke City fell through. Not only does this jeopardise the keeper’s World Cup prospects, it also means that they will have to carry on finding his substantial wages. Portsmouth understood, as is customary in such deals, that they would have to pay a proportion of James’s £45,000 weekly wage, but insisted that Stoke should pay him from the last Premiership game on 9 May to the end of his contract on 30 June. It is believed that if James play a set number of Premiership matches, thought to be 20, Portsmouth would have to offer him a 12-month extension on his contract. This would amount to another £2.5m on the wage bill, leaving aside the money Pompey would have to pay him between now and June.
It could be argued that Pompey have shot themselves in foot in an attempt to save £300,000.
There have been claims that al Faraj is about to arrange a substantial new bank loan. However, in the absence of transparency from Portsmouth, it is difficult to be optimistic about the club’s prospects of avoiding administration. Turning to the lawyers could be seen as a desperate last throw which could backfire. The local management is undoubtedly highly professional, but they are facing difficult circumstances not of their own making, and the way out is not to paint themselves into a corner.