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Birmingham Post
Birmingham Post
Business
Tom Pegden

Government steps in to try and end financial rows which threaten very future of Derby County Football Club

The Government has stepped into the row over the financial viability of Derby County Football Club.

The Rams went into administration in the autumn – and were docked 21 points for breaching EFL financial rules – and have yet to find a new owner.

The process has been delayed by various factors including financial claims against Derby by Middlesbrough and Wycombe Wanderers.

Almost 55,000 fans have signed a petition asking for sports minister Nigel Huddleston to intervene.

Meanwhile a support group, made up of civic, political, business and cultural leaders in Derby has come together to put pressure on EFL bosses to remove the obstacles blocking the takeover of the club.

They want the EFL to allow the Rams takeover to proceed – and for the claims by Middlesbrough and Wycombe to be dealt with after the takeover is completed.

There are currently three interested parties in the mix and the administrators had been due to announce their preferred bidder last week.

Now the Government has called on the EFL to work “pragmatically and rapidly” to resolve issues that threaten the club’s future.

Middlesbrough and Wycombe are seeking compensation for loss of earnings in relation to the Rams’ financial breaches and potential new owners are reluctant to commit themselves to further liabilities.

Culture minister Chris Philp told the Commons on Tuesday: “In relation to the English Football League, the sports minister (Nigel Huddleston) has been in close contact with them.

“We do want to see the English Football League work urgently and pragmatically and rapidly to resolve these outstanding issues which are in the way of a takeover by a new owner, who we hope can invest the money needed to turn the club around.

“He is pressing the English Football League very hard on these points and I’m sure he’ll do so again, and I’m sure the English Football League will be listening to our proceedings this afternoon and hear the message coming from this House and will act accordingly.

“The current situation is a worrying one for fans, the local community and football alike. No one wants to see one of the founding members of the Football League in administration and facing threats to its survival.”

The EFL said on Monday it is committed to resolving “a complex legal position” that is threatening the Rams’ bid to find a buyer and exit administration.

An EFL statement read: “The current situation remains challenging as Middlesbrough and Wycombe Wanderers consider their claims should be protected under the terms of the Insolvency Policy. The administrators disagree.”

The EFL added that Derby consider the claims to be “spurious”, but the current bidders “appear unwilling to assume the risk of defending them”.

Middlesbrough issued a lengthy response, saying that by “cheating” the rules, Derby had cost the Teesside club a place in the Championship play-offs at the end of the 2018-19 campaign.

The Rams have always denied any wrongdoing.

In its statement, Middlesbrough said: “Without breaking the confidentiality of the proceedings, in simple terms, MFC allege Derby County and its directors systematically cheated under the P&S Rules and that such cheating affects the integrity of the competition.

“At least two clubs, namely Middlesbrough and Wycombe, were directly affected by the cheating, albeit in different seasons.

“In simple terms so far as MFC is concerned, had Derby County not cheated, MFC would have been in the play-offs.

“However, Derby County did cheat and, as a result, MFC lost the opportunities that arise as result of that.

“It is said that there is no prospect of the claim succeeding, in which case there is no risk for a new owner. But, on the other hand, the administrator apparently cannot find a new owner because they will not proceed without the claim being settled due, presumably, to the fact that it has merit and might succeed.

“If the claim has no prospect of success, MFC does not understand why a new owner would resolve the matter by accepting that the arbitration decision should be honoured.”

Wycombe were relegated last season, but claim if the EFL had immediately imposed a points penalty on the Rams, then they would have stayed in the Championship and secured significant extra revenue.

Wycombe owner Rob Couhig maintains the club are owed compensation after Derby “gamed the system” and had “their hand caught in the cookie jar”.

The American businessman and lawyer feels the administrators “have no clue how to get this thing resolved”, but remains open to further dialogue.

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