Portsmouth have been sucked down the Premier League plughole
after they are docked nine points for going into
administration.
The cash-strapped club have been unable to find a new buyer and
administration will see them plummet down to just SEVEN points -
all but confirming their relegation to the Championship.
A statement on the club's website revealed the club entered
administration at 10.20am. The administrators will hold a press
conference at 3pm.
Dark clouds: Fratton Park could soon be hosting
Championship football
Under-fire chief executive Peter Storrie has said he will tender
his resignation when the administrators sell the club.
Portsmouth will be left 17 points from safety with just 12 games
remaining this season. Andrew Andronikou, of Hacker Young, will be
installed as chief administrator, triggering a meeting of the
Premier League board early next week to ratify the nine-point
deduction.
The winding-up process started by HM Revenue and Customs, due
before the High Court next week, will be suspended
automatically.
Hard times: Portsmouth are in crisis
Pompey must enter a Company Voluntary Agreement for unsecured
creditors by the end of the season or start next season with
another deduction of at least 15 points.
The new reality will start when the players fly on budget
airline Flybe for �47.99 each to the game at Burnley tomorrow.
Yet, the 112-year-old club have a better chance of survival,
with four potential buyers circling, waiting for
administration.
Owner Balram Chainrai, who was persuaded to invest £17million by
predecessor Ali Al Faraj, has agreed to keep funding the club and
pay for administration.
'Having the club wound up is not an option as far as we're
concerned,' said spokesman Phil Hall. 'The partners have put £17m
into the club and have a responsibility to ensure Portsmouth FC
survive.'
Rage: An angry fan confront chief executive Peter
Storrie on Friday
A major sell-off of players and the prospect of a long period of
rebuilding in the Championship now looms.
Some finance experts believe the administrator may have to
terminate player contracts now to save cash.
Simon Wilson, partner of restructuring experts, Zolfo Cooper,
said: 'It seems certain that Portsmouth will be relegated and will
need a complete restructure.
'Depending on the level of committed funding available the
administrator may need to terminate players' contracts to reduce
outgoings because the possibility of selling players outside of the
transfer window has already been denied by the Premier League.'
Loyal: Portsmouth fans have watched their side
slump this season
Meanwhile, FIFA are set to discuss Portsmouth's plight at their
next executive committee meeting on March 18.
Today's news was expected after eight days which signalled the
club's fate. Last Thursday they asked the Premier League for
permission to sell players outside the transfer window, which was
rejected two days later.
On Sunday chief executive Peter Storrie revealed a South African
consortium were pursuing a deal to Portsmouth - but nothing came of
it.
Current owner Balram Chainrai confirmed the club would go into
administration if they did not find a buyer by today - and despite
New Zealand-based businessman Victor Cattermole admitting his
interest in buying the club, a deal was not done in time.
High times: Pompey won the FA Cup in 2002
Chainrai's spokesman, Phil Hall, said: 'He hasn't made a penny
out of the club. He was asked in October to put in £17m as a loan,
for six weeks, and he agreed to do that.
'At the end of six weeks he expected his money to be returned
and that didn't happen. He gave them a bit of a grace period but
the loan wasn't repaid so in January he took over the shares of the
club. He put another £2m in this week to make sure the staff were
paid.'
Asked how Pompey ended up in administration, Hall continued:
'The club's debt is too great. He (Chainrai) was also given false
promises when he came in. He was told the club had certain debts
but didn't know that Premier League rules say football debts become
a priority, that money owed on transfers must be paid first.
'He asked the questions and was given answers and assurances
that turned out not to be true. Having put £17million of his own
money in unfortunately he found the club
facing a winding-up order on Monday.
'He had a choice of allowing the club to go into administration,
for someone to go in and try to bring it back into a stronger
financial position. He feels he's a victim - the club have been
overwhelmed by these debts and he is a reluctant owner.'
However, Hall believes there could be a satisfactory outcome for
Chainrai and the club.
He added: 'He's been left holding the baby but he wants to do
what's right...he feels this is the right solution. Buying a
business with a huge debt around its neck is not an attractive
proposition - but there are parties who say they are interested.
Some of them may be interested if they are on a stronger financial
footing.'
