Everton have endured a long and quiet summer. There has been virtually no movement on the transferfront and little talk of future investment either. What may have been seen as a crumb of comfort ahead of the new Premier League season; that the club has kept all of it’s star players, has now given way to a much more deep-seated realisation. The banks will now no longer lend the club money to carry out any future endeavours. A desperate future lies ahead for the club.
The Blue Union, a major Everton supporter’s group website, yesterday held a meeting with Everton Chairman Bill Kenwright. The results were less than satisfying and show a club right on the financial precipice.
Several shocking facts came to light, none more so than a botched buyout of the club by a company called ICI when it ceased to be even exist as a functioning and practising company back in 2008. A quite simply astounding level of incompetence on a large scale.
They also highlighted that despite austerity measures put in place to tackle the growing wage bill, the current’s squads wage bill still took up 71% of turnover.
Bill Kenwright today issued a statement which included the worrying snippets of information: “we’ve come to a stage with our bank where we just can’t borrow any more. At the AGMs, EGM and shareholders’ meeting I’ve said year after year, what we do is beg and borrow from the bank. That’s what we’ve been doing.”
He went onto add that “we knew we were going to get to a point where things were going to get very, very tight. We knew we had to trade. There has not been a lot of trading in football itself this summer. We’ve not been able to trade yet and that’s the reason we’ve not been able to trade yet.” So it would appear based on the evidence from the supporter’s meeting and Kenwright’s words today that Everton are currently in possession of an unsustainable financial model.
Borrowing money against your future revenues is a fools way to run a business, but what other option is Kenwright left with? He has little personal wealth and despite being an immensely likeable club ambassador, he simply doesn’t cut the mustard when it comes to competing with the rest of the Premier League.
Kenwright himself knows as much. He’s stated previously countless times that the only way for Everton to truly challenge the league’s elite in the future is for the club to find a new owner with billions at his disposal.
The issue over the club’s new stadium remains their biggest obstacle to investment. Without a new stadium, they remain, despite their history, the decent side they currently possess and fantastic manager they have in place, a distinctly costly purchase. Whoever takes over the club will have to fit the bill for a new stadium. If they already had a new stadium, chances are that although their initial price would go up, they’d be an instantly more attractive proposition.