The release of the West Ham financial accounts recently gave us a chance to do an annual check up on how the Hammers are faring with the massive debts they inherited in 2010. The accounts confirm that that they reduced bank debt by a further £12m and that £2.3m was paid in interest on bank loans in the last financial year
These interest payments were paid to Icelandic shareholders, CB Holdings, Vibrac and David Sullivan, all of which acted as bankers in the last financial year. The Hammers have a total of £91.5m of debt, of which £20.5m is due within one year and £71.07m a year later. Cash in bank was £18.07m so therefore ‘Net Debt’ has reduced to £73.5m in May.
Breaking down the debts further a total of £24.5m was still owed to banks or third party lenders in May although this reduced further in August by a further £6.5m Meanwhile amounts owed to other clubs for player transfers is £13m and shareholder loans amount to £49.2m with an additional £9.33m of accrued interest charged at 6-7 per cent.
Looking back to 2010 and David Sullivan once explained: ‘We’ve paid down some of the debt and injected some working capital but there’s still more than £100 million of debt. In that there’s £50 million owed to banks, there’s £40 million owed to other clubs. There’s not a penny to come in, they (the previous owners) have borrowed against the next two years of season-ticket money. The sponsors have paid 70 per cent of their three-years up front. In addition there’s the club’s settlement to a former manager (Alan Curbishley), so the real debt is about £110 million.’
Five years on and much of this debt is now owed to David Sullivan and David Gold in the form of shareholder loans which now total £58.5m including interest. The joint chairman has constantly said they do not see a scenario where they would call in SEAN WHETSTONE @westhamfootball Benefit: West Ham’s move to the Olympic Stadium has added millions to the club’s value these loans. The truth is, unless West Ham made £110 million pounds of profit in the past five they were never going to be able to clear the debts themselves .
West Ham financial accounts also showed that the Hammers have borrowed £30.1m from ‘Pay Day lenders’ James Grant Funding (JGF). The cash has been borrowed against future TV money and is paid directly by the Premier League to the British Virgin Islands lender.
The sole director of JGF is called Jonathan McMorrow as recorded on the West Ham loan paperwork filed with companies house, who was an employee of the James Grant Group until April 2015 which is chaired by Spurs Chairman Daniel Levy. Both companies shared the same registered address at companies house until earlier this year when JGF moved changed to a P.O box.
Following the publishing of the accounts of the last financial year, West Ham also published how much they paid to football agents in accordance with Premier League rules. The total amount paid to Agents/Intermediaries during the period 1 October 2014 to 30 September 2015 was £7,049,001.18. This included two new signings in January and February 2015 and 12 arrivals during the summer.
West Ham were the sixth biggest spenders to agents in the past 12 months behind Liverpool £14.3m Manchester United £13.8m Manchester City £12.4m Chelsea and Arsenal both on £11.9m. Watford paid the least at £1.6m while Leicester City spent £4m. Premier League clubs have been required to publish the amount they pay to agents since 2008 and West Ham have paid £30.9m since records began in 2008/2009. West Ham did not have to reveal agent fees in 2011/2012 as they spent one season in the Championship .
Finally, West Ham have been included in a top 20 list of the World’s Richest Clubs according to the London School of Marketing. West Ham were one of seven Premier League sides in the list, with the Hammers valued at £196m taking into account our move to the Olympic Stadium next year. Fellow London rivals Spurs are almost twice as valuable with news of planning permission granted for their new stadium.
Meanwhile Arsenal and Chelsea are valued over four times the value of West Ham. Manchester United and City are in a different league, with both over ten times the value of the Hammers.