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Hundreds of millions of pounds flood into Sunderland AFC’s coffers: investment or payment?

News emerged yesterday that over £150 million was injected into the club, but why?

Sunderland v Chelsea - Premier League Photo by Paul Thomas/Getty Images

Yesterday, news emerged that over £150 million appeared in the club’s coffers as a ‘statement of capital following an allotment of shares’. Many fans, myself included, were intrigued as to what this meant for the club.

Was this Uruguayan businessman Juan Sartori entering the fold? Was this investment from the Madrox group? Or was this confirmation of the clubs new status as a debt-free entity?

If truth be told, the only man who can really answer that question is Stewart Donald himself, and this coming Thursday you can be sure that the Roker Rapport team will be asking the owner of the club exactly what this announcement means when he appears as a guest on our Podcast.

However, for now, it seems reasonable to ponder the announcement and analyse what it could mean for our club.

If truth be told, when you begin to piece the information together it doesn’t seem likely that this influx of cash is from our new owners. Instead, it looks like confirmation that Ellis Short has indeed cleared the club of its debt, and in turn has sold Sunderland to Stewart Donald and Charlie Methven at a cut price. The club was sold on May 21st, and this announcement is listed as being undertaken on May 22nd, lending credence to the claim that this is merely an unusual method of confirming the sale of the club and its new debt-free status.

So, in basic terms, Short has cleared the club’s debts and then sold the £152 million of share capital to Donald and Methven for £40 million - as confirmed by Donald after taking control of the club. The club’s accounts will confirm this when the document is released in its entirety, or when confirmation of the SBC loan being repaid in full is satisfied.

One thing many will notice, though, is that £152 million seems to be higher than the club’s last listed debts of £125.7million. Where/why the extra £27-ish million was added to that overall debt remains to be seen - as does the sale of the former Charlie Hurley centre.

Perhaps that extra money was negotiated into the deal in return for Ellis Short’s efforts at personally ensuring the club continued to function day to day? Who knows right now, but that information will likely become clearer as the document is released in its entirety within the next five days, or so.

Likewise, this Thursday will be a great opportunity for the Roker Rapport team to personally ask Stewart Donald about the club’s financial situation as he makes his second appearance on the show.

Furthermore, as reported yesterday on the site, it does seem like the ball is beginning to roll with regard to new signings and outgoings. As Donald noted yesterday on Twitter:

Details Thursday but can’t mention names for obvious reasons. We have 4 very close. 1 CB 1 CM 2 Forwards. Contract done on 1 and the other 3 very close. Hoping they will be in over next few days and a few players likely to go the other way. Thursday I will update in more detail.

Donald also noted in another tweet that contrary to some people’s beliefs, the club does not need to sell in order to buy new players:

Guys. I will go through the detail with Love supreme & Roker report Thursday to explain where the club are at & why with Paddy McNair. We also have offers out on 5 or 6 players well before we accepted the offer. We can sign before we sell and again I will cover this all off then.

Unfortunately then, it doesn’t seem like we’re about to throw £152 million pound around in an attempt at securing promotion back up the footballing pyramid; however, fans should be somewhat relieved that the club does appear to be totally debt free moving forward.

Savvy investment during this window would further enhance what has already been an incredibly cathartic summer for the club. Here’s hoping all goes to plan; onward and upward!