Burnley's finances

This week Burnley chairman Alan Pace released a statement in which he dismissed concerns about the club’s financial situation and sought to reassure supporters after reports that payments owed to former directors had been delayed.   The concerning reports had arisen during a transfer window in which Burnley have so far failed to sign any new players and sold first-choice striker Chris Wood to relegation rivals Newcastle United for £25 million.

There have always been question marks around ALK Capital’s purchase of Burnley and how it was financed. The owners, who took over in December 2020, bought an 84 per cent stake in the club for in excess of £150 million. They are understood to have taken out a significant loan from MSD Holdings and used a large portion of the club’s cash reserves to help finance the move, while sources suggested they invested around £15 million of their own money.

Pace’s statement was welcomed by some supporters, as he went public to offer clarity and it is difficult to question the work Pace has done on the field, given the positive summer window and the work in securing manager Sean Dyche to a new contract.

They would take a significant financial hit if the worst-case scenario of relegation occurs. It would mean a loss of TV money, which, from the last set of accounts published, makes up over 85 per cent of the club’s revenue.

Parachute payments should help steady the blow as will potential wage cuts which would help lower the current £94 million wage bill. Player sales would also contribute to filling the financial hole created but a quick promotion back to the top flight would be imperative.