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Ten Premier league Clubs Insolvent

An alarming report on the credit condition of Premier league clubs was issued late Monday by Equifax. In a review of credit ratings for the top flight, Equifax declared that 10 clubs would struggle to repay their debts if they were asked.

“We have listed 10 clubs as insolvent because they would struggle if everyone came at once to ask them for the money they owe,” explained Equifax’s external affairs director Neil Munroe. Like most of other sectors of the UK economy, it is likely to be a difficult year ahead for the nation’s favorite sport. Football has more investment from wealthy individuals, but if there’s a sudden crisis, those individuals may struggle and this would impact on the clubs. Not even Premiership football is safe from the recession if investors decide to withdraw funds.”

Teams were scored on a Equifax rating out of 100, the lower the score, the more likely a team is is predicted to default on payments. At the top of the scale are Arsenal and Manchester United, both in the 90s. At the bottom, nine clubs are marked 10 or less, including Chelsea. Hull City have one point out of 100.

Abramovich-bankrolled Chelsea scored just 10 points, because without the Russian’s investment, heavily indebted Chelsea would struggle. This has to be worrying to Chelsea fans considering the persistent rumors that Abramovich may be considering selling Chelsea.

Interestingly while Premier League newcomers West Brom have struggled on the pitch this season, their a credit rating rating of 71 is bettered only by Manchester United and table-toppers Arsenal.

“Every business is facing tough times and our latest analysis shows that the business of football isn’t immune,” says Munroe. “A consumer-driven business, like retailers, the football clubs might struggle in the coming months. As households tighten their belts to cope with the rising cost of living, many fans could decide to watch the match at home, instead of splashing out on a season ticket. And, of course, if they’re not at the football ground there’s less chance of them spending on other club items.”

“Even some of the most successful clubs need to take a look at how well they’re scoring off the pitch to make it through the recession, in particular keeping a close eye on cash flow management and ensuring that they don’t fall foul of bad debt themselves. Arsenal prove that good money management goes a long way in times like these.”

The Equifax Table

98 Arsenal
93 Man United
71 West Brom
65 Tottenham
43 Blackburn
40 Manchester City
37 Sunderland
37 West Ham
26 Liverpool
18 Everton
17 Stoke City
10 Chelsea
7 Middlesbrough
5 Newcastle
5 Bolton
2 Aston Villa
2 Wigan
2 Fulham
1 Hull
0 Portsmouth*
* No accounts filed for Portsmouth at Companies House