Weymouth Are Back In Hot Water

Weymouth Are Back In Hot Water

By on Mar 7, 2010 in Finance, Latest | 5 comments

Spring is in the air, and since it is the start of a new season, it must be time for a new financial crisis at Weymouth Football Club. The club was relegated from the Blue Square Premier at the end of last season and is already adrift at the bottom of the Blue Square South and facing relegation for the second season in a row. According to a report in this morning’s Non-League Paper, the club’s debt is now believed to be at around the £1m mark, and it is being reported that if a CVA cannot be agreed then the club will be liquidated. Yet again – the last time was in October – The Terras are said to be on the brink of closing.

Regular readers of the site will be aware of Weymouth’s predicament. The club was been serially mismanaged since hotelier Martyn Harrison overspent on getting the club into the BSP in the first place and, last autumn, they took on the former Cambridge United chairman as the latest incumbent for the poisoned chalice of the chairmanship of Weymouth Football Club. The team has struggled along, bumping along the bottom of the Blue Square South and sliding further and further from the others in the pack at the bottom of the table. Rolls states that the club’s total debt is now over £900,000 and that he has sought professional advice from insolvency practitioners that have advised him to seek a Company Voluntary Arrangement with the club’s creditors.

This being Weymouth, of course, a financial crisis wouldn’t be a financial crisis without a bit of back-biting from former club directors, and this crisis is no exception. Rolls has claimed that former directors of the club hid the full extent of Weymouth’s debts from him – although, it has to be said, anyone getting involved with Weymouth Football Club would surely be aware of the club’s recent history and that nothing at The Wessex Stadium is ever likely to be as straightforward as it might seem – and two of those former directors have made comments which seem to imply that something about the club’s current financial situation doesn’t quite add up.

There is a hell of a lot of money owed to businesses in Cambridge and people with Lithuanian connections. Hopefully, come the meeting, everyone will be able to justify their claims. I can see that the creditors’ list is not complete and I’m concerned at that. I can think of four or five people that are owed money and have been for a long time.

This is a serious allegation to make. George Rolls has financial interests in Cambridge and Lithuania, so the thinly-veiled allegation that seems to be being made here is that there are irregularities in the financial paperwork that is to be put to the club’s creditors to approve – or otherwise – a CVA. The eagle-eyed amongst you may also have noticed that one word has been missing from all of this talk so far – administration. It is legally possible to reach an agreement with creditors without entering into administration, but the fact that the club is seeking not to enter administration is something of a curiosity if it is insolvent.

The concern of some Weymouth supporters is that agreeing a CVA without the club entering into administration will mean that any irregularities in the club’s books will not be seriously examined. Creditors concerned about what is being pushed forward would have the right to try and force the club into administration so that a full investigation could be carried out, although this may mean the liquidation of the club and this in turn would mean that they would most likely not see any of the money that they are owed being paid back.

What is interesting about the current rate at which the Weymouth debt is rising, however, is the affect that it has on the club’s single biggest creditor, former chairman Malcolm Curtis. As things stand, Curtis would be likely on his own to have a blocking vote on any proposed CVA and a couple of the club’s other creditors (such as HMRC) would be likely to vote against any CVA proposal. If the stated debt gets high enough, however, Curtis’ debt would become smaller as a proportion of the total amount owed by the club. To put it another way, the benign power that Curtis hold over the club will diluted if the club’s debt continues to increase.

At the time that Rolls took the club over, the debt at The Wessex Stadium was said to be around £550,000. Did he think, in all honesty, that a club in a position as enfeebled as the one that Weymouth have been over the last year or so, had any chance of even breaking even on a trading basis, let alone making inroads into reducing the capital of their existing debts? A CVA would be likely to reduce the level of the club’s debts by anything up to 90% and give them a five year security blanket in which to pay this amount off, but there is at present nothing like a guarantee that the club can continue to trade solvently.

Meanwhile, the list of the club’s creditors that has been released by the club itself makes for depressing reading, and indicates the extent to which Weymouth have been leading other local businesses a merry dance over the last couple of years ago. It is worth considering that whilst considering that the club’s biggest investors are one issue, small local businesses and individuals will, in the event of a CVA being agreed, be railroaded into losing money that they can ill afford to lose. Anande Gankande, a former club doctor, is owed £525.00. C & O Tractors are owed £1,556.83. The Dorset Cake Company is owed £379.65. Wey Valley School is owed £228.00. These people and companies are the other losers of Weymouth’s mismanagement – individuals and small businesses that have done nothing wrong other than trust a football club to repay a debt that it owes. Weymouth Football Club hasn’t even been paying its television licence.

Crowds at The Wessex Stadium are down to a core of a few hundred, and this is not enough people to dig the club out of the whole that it finds itself in yet again. Even if a CVA is agreed, it seems unlikely that the club will not be back in some sort of scrape in six months or so’s time, and relegation from the Blue Square South into the Southern League seems certain at the end of this season, even if they manage to avoid some sort of points deduction over their financial condition. Every time the put-upon supporters of the club have dared to hope that new owners will come into The Wessex Stadium and sweep it clean, something has happened which has only pushed the club closer to the precipice. It is starting to feel as if the end of the club is the only way that this particularly enduring soap opera is going to end.

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    5 Comments

  1. It is sad to see my home town club fall apart in this way, but it simply has to. Ludicrous as it is for a 50,000-population town, the largest for over twenty miles and with no Premier League ground within a hundred-mile radius as of next season, to be unable to support a moderately significant football club, it has turned out that is the case.

    There’s a lot of clubs I would much sooner go to the wall than Weymouth though. Never mind the financial circumstances, the very fact that the stadium is privately-owned is the killer. As if that weren’t enough, the site has been eyed by Asda before – they planned a move out of their current store into a larger complex *next to* the stadium as far back as 2005 (http://archive.thisisdorset.net/2005/9/3/110823.html) and the availability of the stadium area itself would allow them to develop an even larger store with fewer planning issues. Public support would probably be forthcoming, too… the current Asda is too small for the area it serves.

    Of course, all of this means that Weymouth will be a town of 50,000 without a football club. A town preparing to host events at the Olympic Games, without a team in the country’s national sport. What a story that is.

    David Howell

    March 7, 2010

  2. I recall contributing to the appeal by supporters some time ago to help them buy the club. Instead they decided to stay “private”.

    More fool them, sad though this story is. Incidentally, what happened to the monies raised?

    Rob Bernard

    March 8, 2010

  3. Anyone else starting to get compassion fatigue??

    mick

    March 9, 2010

  4. The question is, Why did the Terras Trust not do more back in the early days of Curtis, when it was obvious to some that the club was being badly run. There were a few who raised their concerns but as usual it was follow the party line or you are a poor supporter.
    The continual in fighting on the internet and the lack of a leader to raise any kind of objection to Curtis has lead to this downfall. There are some of the core supporters at this club that really need to look at themselves and ask the question. Did I do enough? Let the dept build up, yes agree might as well. And for gods sake, organise a protest and don’t attend the next game!! TRUST DO SOMETHING!!! Somebody do something, but trotting along to the games to watch another thrashing is NOT the answer. At least make your feelings felt, I have never seen such a bunch of poorly organised supporters anywhere. No sympathy any longer, this club is dead.

    Jack

    March 10, 2010

  5. Nice to see some articles about my home town club too – pity they’re about such a crap issue! We’re doing OK this season, should stay up at least (so it seems so far…) but as my dad says, it’ll be 15 years until they can get anywhere near where they were when Claridge was here. Ah the glory days. Was it his reign that started the slippery slope though? I know they spent a lot of money on him and other players, and again when Gary Hill got us promoted – was that the beginning of the end? Did we do a Leeds? I don’t know enough about it to know whether this kick-started it or whether the financial problems began under another chairman’s managemet?

    Jude Ellery
    http://www.footballfarrag.com

    If you’re interested in writing articles for my site by the way, let me know! Cheers

    FootballFarrago

    September 10, 2010

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