Will Mel Morris be prepared to take a hit when selling Derby County Football Club?
We are currently in the final international break of the season, but things are happening off the field at Derby County Football Club.
It has been revealed that Mel Morris is looking to sell the club and there are interested parties already reportedly from America and the Far East.
I actually tweeted a couple of days before the mainstream media went to print with the stories.
Morris is rumoured to have pumped over £160m of his own cash into the club, however it appears that he will be looking to recoup what he has spent.
He could sell the club for £1 if new owners were to take on the debt owed to him!
I have to say that I can’t see the figures being banded about as anywhere near reality.
Most clubs in this position see outgoing owners take a big hit when selling on.
GSE converted debts owed to them into equity which basically is very low value shares.
There’s absolutely no way I can see any incoming owners of the club paying over £100m or indeed taking on the debt owed to Morris.
Our neighbours down the road saw their outgoing owner write off much of what was owed to him as did his predecessor’s family.
If Mel Morris has the good of Derby County in his plans there will surely be some manoeuvrability in negotiations to ensure the future of the club is secured.
Several players are out of contract in the summer and, although this will see some big earners off the books, it will also see the squad valuation drop when the accounts are completed.
What is certain is that the club cannot keep accumulating losses at the current rate.
Matchday income for 2016/17 was £8m whilst wages were £40m.
Unless promotion is achieved that is a one way street to financial difficulties.
We are still awaiting the accounts for 2017/18.
As an advocate of Financial Fair Play, one would expect our owner to meet it. Frank Lampard had to sell to bring players in.
Of course us older fans are no strangers to financial problems at the club.
We nearly went out of existence in our centenary season and then we had Robert Maxwell and The Three Amigos eras too.
The next few weeks will certainly be very interesting.
All we can do as fans is to hope that a takeover will be achieved smoothly and that the parties who eventually take custody of our club are ambitious but responsible.