Tottenham Hotspur have borrowed £175m from the Bank of England to help ease financial pressure brought by the COVID-19 pandemic. This is the latest news from the club via David Ornstein and Jack Pitt-Brooke of The Athletic.
The club will lose £200m of revenue this year. This is in part due to Tottenham’s stadium not being able to host matches or other events.
The club is eligible for a COVID Corporate Financing Facility (CCFF), repayable with a 0.5 percent interest rate.
Tottenham Hotspur Will Borrow £175 to Cover Losses
Spurs’ Financial Situation
Before the pandemic, Tottenham were in a good financial place. The club had just announced revenues of £460 million– an increase of £80 million on the previous year. Careful financial management had allowed them to leave White Hart Lane and move to a new stadium.
Building finished on the Tottenham Hotspur Stadium last year at an estimated cost of £1 billion. However, the new ground is a substantial financial black hole that needs to host events to become profitable.
The COVID-19 pandemic makes that impossible.
“We are all facing uncertain times both at work and in our personal lives. I have spent nearly 20 years growing this club, and there have been many hurdles along the way – none of this magnitude – the COVID-19 pandemic is the most serious of them all,” said chairman Daniel Levy.
The club has already tried to cut costs during the pandemic. In March, 550 non-playing staff had their salary cut by 20 percent to protect jobs by using the government’s furlough scheme.
However, they were forced to backtrack after widespread criticism and later announced that non-playing staff would get their full salaries for March and April.
Tottenham’s On-The-Pitch Performance Hurting the Bottom Line
A significant portion of Tottenham’s earning last year was down to one thing – their successful Champions League campaign.
However, this year told a different story. The club was eliminated by RB Leipzig in the Champions League Round of 16. Also, they find themselves eighth in the Premier League – seven points off Champions qualification. Failure to secure their place could cost them a minimum of £7.3 million with further bonuses for victories and progression in the competition.
This could also damage their ability to recruit top European talent.
What this means is that COVID-19 could potentially knock Tottenham into a cycle of trouble. The board will be hoping that Harry Kane and Co can make up the Premier League gap to fourth – any other result could be disastrous.
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