Dr Dan: People now cautious before investing in Everton
We’re delighted to welcome football finance expert Dr Daniel Plumley as our exclusive columnist. Each week he’ll be giving his views on the biggest talking points at Everton...
People are now more cautious about investing their money into Everton.
That’s according to Dr Dan Plumley who claims that relegation could have devastating effects on the Merseyside club.
They’re already close to the line with FFP and have massive expenses to incur for the new stadium.
Apart from that, Alisher Usmanov and all of USM’s affiliated companies have now gone, leaving the club with a massive financial abyss.
All this clubbed together along with relegation could see further doom for Everton.
The Sheffield Hallam University expert exclusively told Goodison News,
“Relegation causes all sorts of problems for clubs, especially when it comes to investors.
“For starters, it significantly reduces the valuation of a club. You might think if it’s cheaper then it’s cheaper for investors but it’s not that simple.
“You have to factor in player contracts, wage bills, operating costs in a league like the Championship when you’re down £60million down on revenue before a ball is even kicked.
“That’s the shortfall you’re looking at including all the broadcasting revenue that comes from the Premier League.
“You may get parachute payments but you’re still down on commercial and matchday revenue.
“It impacts everything and that’s what makes it tricky from an investment point of view.
“Relegation will be devastating for that club, given the FFP figures, given the new stadium. It will be a huge financial blow and you’ve got to recover quickly.”
The Toffees are believed to be in conversations with the Premier League over a potential points deduction and how to stay within the Profit and Sustainability rules.
It is unlikely that any deductions will be imposed before the end of the current campaign.
In other Everton news, a football finance expert has made a claim on the new Toffees stadium amid a major £300m development in the last week.
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