Aston Villa in administration?

The famous club is facing a serious financial crisis

Download Perspecs

Are Aston Villa in danger of administration?

By Joe Harker

Aston Villa are one of the most famous teams in English football, though their current situation is somewhat less than impressive. Since being relegated to the Championship, new owner Dr Tony Xia promised to restore the side to prominence and get them back into the Premier League. However, defeat to Fulham in the play off finals condemned Villa to another season in the Championship and the club have now been struck by a significant financial problem.

The club missed a £4 million tax payment to Her Majesty's Revenue and Customs on Friday, prompting concerns that the club didn't have enough money. They have since reached an agreement to pay the tax bill, forking over £500,000 in the first instalment and another £1.2 million later on. It is understood that Dr Xia is having cashflow problems due to a law about money leaving China.

However, The Guardian reports that the cashflow problems have been going on for some time. The tax payments were inconsistent in 2017, scraping the money together by asking clubs they had sold players to for a new transfer deal that secured them more money in the short term. Even though Villa have struck a deal to pay May's tax bill, they will have to find another £4 million for June.

Simply put, Aston Villa bet the house on promotion from the Championship and lost. Going up to the Premier League would have seen Villa in line for a £160 million windfall but they are now going to spend a third season in the Championship when they are paying big transfer fees and big wages. The parachute payments only last so long and if Dr Xia cannot get his money out of China fast enough then the club is in trouble.

Birmingham Mail reports that the Chinese businessman will do everything possible to keep hold of the club and ensure it is financially solvent, desperate not to see it fall into administration. The danger hangs over the club but hasn't dropped yet.

Still, in their current predicament it seems that Villa will have to consider other ways of making money, even if that means selling players. The likes of Jack Grealish would bring in large amounts of money but getting the wage bill down would also be a necessary measure. They cannot continue to operate on a Premier League budget in the Championship.

Sports Illustrated reports that salvation could be at hand from American businessman Peter B. Freund, who they say is preparing a £75 million takeover bid. While Dr Xia does not want to sell they suggest he might decide to cut his losses if a large enough bid was made, something closer to £100 million would be deemed more appropriate.

Download Perspecs
Download Perspecs