Wigan in Administration

Well we knew the clock was ticking but now the alarm as just gone off, knowing how bad it was for us last year, i truly do not wish this on any club, yes i know they took the piss big style but your club is just that your club, and i can't think of anything worse in sporting terms than seeing something you have invested in throughout your life disappear.

If they survive maybe they have learn't not to play billy big bollocks when a rival club is in trouble, if they go then they will have a long time to reflect. With Charlton also on the cusp serious times for the EFL and with covid who knows what the start of play will be by next summer.

How transfer fees are helping Wigan Athletic to survive

Administrators who have taken control of the club met with officials from the governing body late last week.

They sought assurances they could use any money paid for players to help the club survive until a buyer for the club is found and in place.

It meant, for example, the fee paid by Leeds United for Joe Gelhardt – thought to be £1m – could go towards players’ wages as a priority, rather than go into the pot for creditors’ debts.

Paul Stanley, one of the co-administrators, said: “We had a meeting with the EFL on Friday and they were really supportive in terms of allowing funds from player sales to take immediate cash flow problems away.”

The fee for Gelhardt covered July's wage-bill for the players. The 18-year-old was highly sought-after even before Latics went into administration, and suffered a subsequent relegation.

But it's little surprise that Kieffer Moore [Since been sold to Cardiff] and Antonee Robinson have been the latest players linked with exits - and not just because of their stock as players.

Like any club exiting administrations, Latics must clear all of their football creditors’ debts.

And that includes any outstanding transfer fees – even if previous instalments had been arranged.

Administrators give update on sale of club Robinson has been linked with a £2m move to Premier League side Sheffield United. Latics, though, would need to use some of that fee to pay the rest of the transfer fee which they owe Robinson’s former club, Everton – believed to be in the region £500,000.

And the club still owe around £1.5m to Barnsley for Moore and £750,000 to Portsmouth for Jamal Lowe.

It is understood they also owe money to Everton (for Joe Williams) and Rangers (for Josh Windass).

If those players moved on, it would massively reduce the football creditors' debt. Ideally, given the circumstances, Latics would sell those players for more than they owe their previous clubs - so any excess money can go towards the upkeep of the club during this period in limbo without an owner.

As well as transfer fees, football creditors’ debts include any unpaid players wages and agents fees.

Any new owner would need to clear those in full before bringing Latics out of administration. The administrators - who have been in control of the club's affairs since July 1 - will also be paid for their work, before any remaining goes towards paying non-football creditors.

If they don't receive at least 25p in the £, Latics will incur a 15 point penalty.

While the sale of Gelhardt funded players' wages, money raised by fans paid the July wages for office and stadium staff.

The fund set-up by the official supporters' club has already topped the £190,000 mark and they are hoping to reach £200,000 to potentially cover August wages, too.

They had previously used money raised to pay for hotel stays and travel so Latics could complete their Championship campaign.

https://www.wigantoday.net/sport/football/how-transfer-fees-are-helping-wigan-athletic-survive-2940821

Confirmed | Kieffer Moore has completed his permanent transfer to @CardiffCityFC.

Thank you for your efforts this season, @KRFMoore! Best wishes with Cardiff and @Cymru!#wafc

— Wigan Athletic (@LaticsOfficial) August 13, 2020

Almost feels like we were lucky to go through our shit 12 months before. Who knows how covid would have affected us.

There are still Wigan fans greeting this news with incredulity and yet it bears all the hallmarks of what happened to us - settling with creditors, selling players, worries over where the wages were coming from, worries about not getting a buyer, watching the house being sold from under their feet etc etc - our fans were the same. Although in our case I was just as worried when we did get a buyer
I feel for them.

I think any real football fan would feel for them Lusty, especially those like us who have been through the mill too. I know they gave us pelters and must now be feeling contrite with what’s happening. I have to say that I’m not at all confident that a deal will be done in time but if there really are four genuinely interested parties there must be a fair chance at least one of them will deliver. Times are tough though and whoever might buy them has to consider that most if not all of their best players will have gone and like we were, they will be among the favourites for relegation, especially if they end up with the additional 15 point penalty for not paying creditors the minimum 25%. I hope they survive but if they don’t I still don’t think they’ll be the only ones to go pop before the season starts.

One of their fans who is supposed to have spoken a number of times to the Administrators previously and did that video interview tweeted this following from their official announcement yesterday.

ADMINISTRATORS UPDATE:

RE: INTERESTED BUYERS

- 4 interested parties, all had a contract.

- One was shown around everything today.

- Admins working on a 'Plan B' with supporters group if we were to pass the deadline without being taken over. pic.twitter.com/zFFDl5DZLs

— Harry Robinson (@RobboHarry) August 13, 2020

My view fwiw is something along these lines -

Why would anyone want to buy the club

Either because they are a massive fan, as some sort of investment to get to the PL and big money, or as some sort of a business venture.

The Fan Option.

Whelan was their Eddie and he's got money issues of his own, so he's out.  The only other person linked seems to be the owner of Wigan rugby (who once owned Oxford football club - Wigan born Ian Lenagan.

Rugby in general has problems of its own with Covid and tackling involved in the game -

Hull FC & Salford Red Devils will not play this weekend after Hull positive Covid-19 tests
https://www.bbc.co.uk/sport/rugby-league/53753673

Would he therefore want to take on a loss making football club at this time too?

The PL Punt Option

If you had the money to burn, then why not have a punt with Wigan.  It seems to have all the facilities stadium, training ground, links to Manchester and on to London or international flights abroad (if you are a foreign investor).  Desperate/frantic  for a buyer.

Seems a good as place as any.

Thing is though the last owners from China took a punt on them too and looked what happened - then throw in the unanswered question of Covid.  There's going to be a second wave (and a third and forth, etc) until some sort of answer is found to it - and whose to say next season (or the one after, etc) won't be effected/suspended?

An unquantifiable risk to be taking on with maybe even bigger (and higher tier) clubs becoming available soon perhaps?

The Business Venture Risk

Tbh I've still not worked out FV's plan for us, so guessing why others would see a potential in Wigan is beyond my ken.

The physical assets seems to be a stadium two training grounds and a some chip shop(?) or land where a chippy stood or something (I've not looked into to this one) - all however seemed to be constrained by planning regulations to be used for sport/recreation and not building homes/factories on.

Maybe you can sell the land to fund the trading losses on the club until you can manage the club at a financially sustainable level - but you still have to deal with outstanding football creditors (was £6m) and unsecured creditors (was £1.5m) and the - is it real, is it not - £24.5m loan!

Conclusion

Whoever buys Wigan needs to -

- deal with the £24.5 loan - if that really exists there won't be a buyer full stop.

Assuming it doesn't exist needs to -

- pay off footballing creditors - lets say player sales under Admin is able to do that.
- pay off unsecured creditors - lets say that's gone up to perhaps £2.5m by now
- pay off August wages - say £1m
- show proof to EFL of monies to cover the trading losses of the club for the next two years - say little to no income over the next season with most players still contracted on the wages they are on (some talk of clauses re salary reduction for relegation?) lets say £4m loss year one and £1m year two - and I must stress that would be after income from fans for ST's and match day income!).

There is also who pays for Administration - for the Administrators time?

I'm guessing that the deal was to recover the fee from the sale proceeds of the club - if so whoever buys Wigan will have to pay a sum equivalent to the Admins fees for their services - let's say £1m.


So we are talking about someone having to pay out about £1m for August wages, £2.5m for unsecured creditors (or take a 15 point penalty and still owe the money) and £1m for the Administration totalling about £4.5m up front.  

Afterwards they are looking at about a further £5m losses over the next two years (again stressing that assumes after receiving ST money and match day income - without this you can easily double that amount).

So you need whoever buys them to have somewhere in the region of £10m now in order to show the Administrator and EFL proof of funding.

My guess is that only Lenagan would have reason to do something like that - but why would he - wouldn't it be much cheaper and simpler for him just to buy the stadium (and training ground/s) off the liquidator and let the football club go under.

It would also fit it what the tweet above says - someone (Lenagan) has visited all the sites (stadium and training grounds) that day.

Doesn't necessarily means he wants to buy the 'football club' but simply wanting to buy its 'assets' only!

Just my view on things - but the clock is ticking and I can't see Wigan being allowed by the EFL to start the season without a firm and serious buyer involved in buying the club before hand.

The £24.5m loan seems to be real!!!

My understanding is that shareholders have been issued a copy of the accounts by the Administrators - if so it seems to be the killer blow for Wigan FC.

Wigan's owed amount to creditors is totalled at £45,712,567.

Major creditors:
Next Leader Fund - £25.3m
Wigan Athletic Holdings - £10.7m
HMRC - £2.8m

EFL - £2m

Clubs owed money: Everton, Portsmouth, Barnsley, Chelsea, Bournemouth, Sunderland, Rangers Leek Town.#wafc pic.twitter.com/OrTTX65xBt

— Harry Robinson (@RobboHarry) August 14, 2020

Sluffy, you need to look in to that Chip Shop.

It could be the key to survival.

Not sure if this is right but i recall that when David Sharpe (DW Grandson) was appointed chairman Wigan fans had a laugh because all he had ever run was a Chippy ? and i think he made a balls of that but grandads money bailed him out. So guessing the chippy was probably bought by DW so part of the assets when he sold it on.

If those figures above are correct then they are toast chippy or not.

Yes it just seen it was called Sharpy's Chippy near the DW  now closed down

It's my honest opinion that we will have to merge with someone sooner rather than later. A few years ago a sports writer suggested we should merge with Bury (obviously before their troubles and ours became so pronounced) and that perhaps Rochdale should merge with Oldham Athletic. I don't say it's the right solution or that it would have gone down well with the fans of the clubs involved but his wider point was that the 'smaller' North West clubs were not going to survive in the Premier League era as things stand. The massive disparity in income between the top flight and the rest means that most clubs simply cannot get there in a sustainable way. I don't know if mergers will happen but I am absolutely certain that if they don't then there will be more Burys, more Wigan Athletics, more Bolton Wanderers and that administration will no longer be a way out of trouble but simply a stepping stone on the way to extinction.

Only a radical and frankly completely unlikely shakeup of how money is distributed throughout the game could avoid that but I cannot see any way in which the current beneficiaries (eg Liverpool, Man City, Chelsea and the other Premier League 'big clubs') will ever agree to something that takes money out of their coffers and puts it elsewhere.

No club is going to merge with a local rival Peter, the fans simply won't accept it.

They would rather go bust and start again than become Bolton/Bury/Wigan Wanderers FC.

Fans won't follow from Bury or Wigan to watch at the Reebok and Bolton fans will be pissed off with the name change.

It might make financial sense but in practise it simply won't be acceptable to the people who pay to keep the club going.


Back to Wigan news - Administrators bill estimated to be £1.3m!!!

luckyPeterpiper wrote:It's my honest opinion that we will have to merge with someone sooner rather than later. A few years ago a sports writer suggested we should merge with Bury (obviously before their troubles and ours became so pronounced) and that perhaps Rochdale should merge with Oldham Athletic. I don't say it's the right solution or that it would have gone down well with the fans of the clubs involved but his wider point was that the 'smaller' North West clubs were not going to survive in the Premier League era as things stand. The massive disparity in income between the top flight and the rest means that most clubs simply cannot get there in a sustainable way. I don't know if mergers will happen but I am absolutely certain that if they don't then there will be more Burys, more Wigan Athletics, more Bolton Wanderers and that administration will no longer be a way out of trouble but simply a stepping stone on the way to extinction.

Only a radical and frankly completely unlikely shakeup of how money is distributed throughout the game could avoid that but I cannot see any way in which the current beneficiaries (eg Liverpool, Man City, Chelsea and the other Premier League 'big clubs') will ever agree to something that takes money out of their coffers and puts it elsewhere.

I share the same semi-dystopian - and occasionally logical - view at times, but it will be a long time coming and between now and then there's lots we can do to change where we are in that equation. 
Only a meteor strike of planet-ending proportions on my house is likely to dampen my enthusiasm for the coming season even though I've no idea how we'll perform against professionals yet.
But in a capitalist society, the redistribution of wealth inexorably moves towards marketable meritocracy so if our product is good enough we'll be OK. At least in the short term.

In some ways Peter that's like the tail wagging the dog, i agree that something needs to be done, but the solution you propose means that again it's the fans that suffer footy fans are married to one club, if you merge it stops being your club. 

How about the governing bodies see the bigger picture and grow a pair, by insisting, negotiating or even legislating that the money generated is split more evenly ? 

You will always have clubs that have a bigger fan base and feel entitled to a greater share and that's fine but make sure that the have nots have enough to survive. They survived despite the number of clubs in any given area for 100 years , Sky money is the problem not the clubs, fans are easily pleased they accept disparagy but need a club to support that reflects their background not some hybrid that appeases the big boys. 

Sky money already shafted the FA Cup, (pundits pretending it's still a top competition ) lets stop them doing it to the EFL pyramid of 72 distinct and original clubs

It doesn't work that way though mate.

I know you were into athletics at one time so let me try to use that as an example to demonstrate,

Say your athletics club was run by a collection of people who specialised themselves in separate athletic disciplines say for instance a sprinter, a long distance runner, a shot putter and a javelin thrower.

You are part of the English Athletics Association and you are one of the best clubs around and seem to attract all the star athletes.

The TV company likes to show athletics and with your club providing all the stars you feel a bit hard done by that you only get the same share of what the TV company pays to broadcast the athletics as every other club in the country - even when you and your mates have put an awful lot of time and expense making the athletes the best they can whilst many other clubs are run by the old guard who don't want to change their ways from Victorian times and they all vote against you all the at the English Athletics Association AGM's.

Then someone comes up with an idea that you cut the middleman out and go directly to the TV company yourself!

This happens, the TV company wants to see YOUR star athletes and you run your own events.

You start up your own competition - 'Premier League Athletics' and breakaway from the EAA.

English AA still run their events but the TV company are not interested because it is rubbish without your stars so they only pay them buttons to show highlights nobody apart from the teams themself want to watch.

Your club starts to become very rich but also your stars want a share of it and a big one at that!

On top of that each of your disciplines - sprint, distance, shot and javelin turn into specialist clubs themselves, with their own facilities, staff, coaches, tracks, etc and get an equal amount of what the TV company pays you and an equal vote in things.

One thing though is that not all the four disciplines are as popular as each other and the TV company likes say sprints more than shot put, in other words they get 'ranked'.

One of the EAA clubs develops a very good pole vault team - and the TV company likes pole vaulting.

So you have a vote and vote out the shot put people in your club and invite the pole vault people to take their place - and a share in the big money!

The shot put people get allowed back into the EAA but now have massive overheads, so much so they have to slash their costs, let people go and generally go down the tube until they can balance their new existence to the trickle of money they now receive.

Covid strikes and all the smaller EAA clubs suffer - Bury EAA club goes bust and Wigan's look likely too.

Do you think your club should be worried though - you still get the big money from the TV company.

The EAA suggests you help them out - but by doing so it means you take a cut in your income - which you have budgeted and need to receive and spend on the athletes wages and the stadium, facilities, youth teams, etc, etc, for each of the four disciplines that have a vote - sprint, distance, javelin and pole vault.

You've all seen what's happened to shot when they no longer had the same money but had the the expenditure commitments until they had to drastically downsize.

Do you think the four disciplines would want to harm themselves to save clubs with frankly no relevance to them other than they 'play' the same sport at a much lesser standard?

Do you think the government should step in and legislate - it's nothing to do with them.

The EAA have no claims to your TV money, they have their own deal but it's a bit shit because they don't have any stars people want to watch.

It's simply market driven, supply and demand.

The market has too many suppliers and the demand is for premium goods.

Unless smaller clubs/suppliers/teams can find niche markets and sustain themselves then the bigger clubs/suppliers/teams aren't going to vote to financially harm themselves to help them.

They might chuck them a bone of sorts but the realism is that the PL will keep the lion share of the income that is paid to THEM - and not 'football' in general.

Hope this gives you a better understanding of why things are like they are.

Things may well be the way they are, but if something's broke it needs fixing and sometimes that calls for radical solutions. The question is will it still work for the EFL if clubs continue to go bust? Will it still work for the Premier League if there are no clubs to nick players from and to send prospects out on loan to? Will it still work for the FA if there are limited opportunities for young English players to feed the national team? Will it still work for the Government if community bonding around football clubs is dissipated? In essence how much is the EFL and non-league structure valued?

The way things are is that there's a cost/risk analysis to be done by the various stakeholders in this situation.
The Government could decide that it's worth half a billion a year to support smaller clubs financially out of e.g. the Communities fund. The FA could decide on a financial restructuring that protects smaller clubs. Fans could have a say in it. 
Bottom line is that we don't know how far it will go before some stakeholder or other decides to act.

wanderlust wrote:Things may well be the way they are, but if something's broke it needs fixing and sometimes that calls for radical solutions. The question is will it still work for the EFL if clubs continue to go bust? Will it still work for the Premier League if there are no clubs to nick players from and to send prospects out on loan to? Will it still work for the FA if there are limited opportunities for young English players to feed the national team? Will it still work for the Government if community bonding around football clubs is dissipated? In essence how much is the EFL and non-league structure valued?

The way things are is that there's a cost/risk analysis to be done by the various stakeholders in this situation.
The Government could decide that it's worth half a billion a year to support smaller clubs financially out of e.g. the Communities fund. The FA could decide on a financial restructuring that protects smaller clubs. Fans could have a say in it. 
Bottom line is that we don't know how far it will go before some stakeholder or other decides to act.

We know enough!

The government won't spend money on something they don't even have a say in - the football bodies are the regulators, nor will they fund private business - they haven't bailed out the airlines for instance during Covid.

The country's got bigger urgent needs than bailing out clubs like Wigan, Bury, Charlton, Macclesfield and the like. If they can't financially sustain themselves, then that's their problem not the taxpayers.

The PL don't need the EFL - how many players jump from the EFL to the PL normally - very few.

The future for them is a European League and tv revenue, not tin pot clubs relying on match day income.

When somethings broke it doesn't mean that it needs fixing, it can also mean it's gone past its time and needs binning.

People will still play football, players will be scouted, loans will still be made but it doesn't mean that is limited to the EFL, it goes on internationally already, I think I'm right in saying that the majority of the players in the PL squads are non British - I am, see link below.

https://www.skysports.com/football/news/11661/10725849/premier-league-has-highest-percentage-of-foreign-players-8211-uefa-report#:~:text=The%20club%20licencing%20benchmarking%20report,division%20(57.1%20per%20cent).

The creation of the PL broke the mould of English football and in a sense the industry is still coming to terms with that change.

There is no going back though, EFL clubs will have to adapt to the consequences of what has happened or go under - simple as that.

We don't know enough yet. What you describe is the situation as it currently appears and perhaps that's just not bad enough yet to act as a catalyst for change...but that doesn't rule out the possibility of it getting far worse down the line.

wanderlust wrote:We don't know enough yet. What you describe is the situation as it currently appears and perhaps that's just not bad enough yet to act as a catalyst for change...but that doesn't rule out the possibility of it getting far worse down the line.

It's definitely going to get far worse - no doubt about that - lower league clubs rely ST's and gate receipts and if they aren't getting those because they have to play behind closed doors or the season is suspended part way through again - then they simply can't carry on accruing debt and not having the means to pay it off.

PL has proved it can survive on broadcasting revenue alone and exist within a player bubble (at least for a given period). Similarly to Test Matches and World Snooker - this seems the way forward at least in the short term.

The government too action to close the door on France at short notice when their rate for the virus went over 20 cases per 100,000 population - fwiw currently 30 of England's 315 councils are already over that total and the current national seven day average is 11.9 and we thus might well be moving back in a lockdown again and consequently even a return to limited spectators at sports matches could be in threat again very shortly - how can you budget to run a business when you can't 'sell' your product to your customers in the case of teams like ours/the rest of the third and fourth tier teams?

I don't follow non league but I guess casualties will be mounting there soon too!

The current industry standard practise of having owners willing to fund company's that are insolvent in terms of trading themselves was unsustainable any way, Covid has simply sped that up. Clubs that can't adapt (like Wigan) will go bust, nobody will be bending over backwards to prop them up - why should they?

That's the reality of what will/is going to happen.

Sluffy, how about you have a day off from posting negativity.

Tell us about a special day in your life following BWFC, your favourite pair of slippers or your favourite meal. Anything with a positive vibe.

Natasha Whittam wrote:Sluffy, how about you have a day off from posting negativity.

Tell us about a special day in your life, your favourite pair of slippers or your favourite meal. Anything with a positive vibe.

Outrageous. I'm not having Sluffy sniffing around the leisure footwear scene. It's a dangerous world, and he'll likely get hurt. Don't cross me.