Amidst West Ham‘s relegation crisis brought on by the club’s on-pitch performance, there is an enormous off-pitch financial crisis to deal with at the same time. Following the downturn in results and the three losses in a row, the Irons now stand likely to be relegated tonight, with the board facing a bleak outlook, with challenges each and every way they turn.
West Ham shareholders can inject up to £105m over the next few months – should they want to.
The Hammers must comply with the final Premier League PSR accounting period which allows clubs to lose £105m over three seasons as long as owners inject £90m in cash If cash is not injected maximum are limited to £15m over three years.
West Ham lost £104m last season but made a £57m profit the season before leaving them on a loss of £47m over the last two seasons. That means they can lose a maximum of £58m this season assuming the shareholder put in £90m of cash.
Will West Ham’s board decide to inject money into the club?
Without the cash West Ham would need to make a £32m profit this season to limit their losses to the maximum £15m loss without shareholder funds. That scenario seems unlikely considering the current state of the club’s finances.
Earlier this week the Championship announced new financial regulations using SCR similar the premier league which would limit cash injections from owners to £15m per season and £30m over three seasons.
That means West Ham shareholders could inject £90m in the Premier League and a further £15m in the Championship in the next few months should West Ham be relegated and they wish to do so.
Sean , I hope your telling Sully this
A new (joint!)Chairman – one that can stand up to Sullivan
A new CEO – one that can stand up to Sullivan
A new DoF – one that can stand up to Sullivan
A new manager and supporting staff
A new Financial Director
This is the bare minimum we require as a business. And that is before we look at the massive turnover in our squad.
I cannot see Kretinsky and Sullivan not putting cash into the business they will want to protect their investment. The question is how much, when and how (ie by loan or share capital). £90m, now and as share capital would be amazing but unlikely I fear.
Thanks for the explanation – now, to wait & see.
Hi Sean, this is interesting info and as our world class team in our world class stadium prepare for relegation we fans can only hope that the owners are prepared to put in money to rectify the terrible mistakes they are responsible for. Along with a capital injection we need to see a total restructuring plan where we have a DoF who has full autonomy and his or her vision shapes our future, I honestly think that might be the only way to begin to placate the fanbase and show we have a clear plan. If we see mr Sullivan in full control of transfers and the upcoming managerial appointment again then the future is extremely dark as he simply cannot do the job effectively. Make the investment, stand back and give our club the very chance to come back stronger, but I fear we will sell everyone and have mr Sullivan and chosen agents oversee another disastrous summer rebuild. Cheers dean
Should they want to hahaha!