Club news

36% REDUCTION IN THE CLUB’S DEBT

09 Oct 2016
Depor announced during the week that €4.06 million of Lucas’ transfer was used to reduce the debt with the tax agency. It’s expected that the club’s debt will be €90 million by the end of the season, a 36% less compared to two years ago.

During the week Deportivo announced that part of the money obtained with the transfer of Lucas Pérez to FC Arsenal will be used to reduce the debt with the tax agency and the banks. More specifically the tax agency is collecting €3.13 million and the banks €937,500.

This is part of the signed agreement with the creditors as any extra income leads to an extra payment of the privileged debt (25%). The club expects that by the end of the season the global debt of Deportivo will be €90 million, it’s a big amount, but it’s encouraging as the debt was €140 million when the agreement with the creditors was signed, this means a reduction of 36% in only two years.

The club expects that the privileged debt will be €50 million by the end of the season, €30 million correspond to the Tax Agency. The initial debt with this entity was €62 million and the club already completed the two payments that corresponds to this campaign (including a €3.34 million payment that should have been made in January of 2017, but that was paid in September). Meanwhile, the debt with the banks will be of €11 million (it was €34 million two years ago).

The next step is to translate the debt with the tax agency to the banks (€30 million). This means to negotiate a new loan with the banks and then pay the remaining of the debt with the tax agency. The point of this move is to not been forced to use the extra incomes generated with the transfers, increase of TV contracts and new publicity in the reduction of the debt with the government, which in the end affects the salary cap. The club managed the option of using an Asian fund too, but the officials didn’t like what was offered and changed to a more “traditional” route.

During the week president Tino Fernández confirmed that the plan is to negotiate this loan with the banks at the end of the present season, “There are a lot of possibilities to do this and I believe we are going to make it. We aren’t searching for money to have new owners, but to pay a debt and improve the competitiveness of the team.”

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