Revealed Newcastle United take out loan to pay for January signings (and/or pay Mike Ashley…)
Mike Ashley has arranged for Newcastle United to take out a loan.
The news has broken on Wednesday morning via Companies House.
Any changes Newcastle United make as a company, have to be filed at Companies House.
This means the public have access to the documents, though there is some delay before they can be seen.
Wednesday morning (30 January 2019) the latest document became available to the public.
It was filed by Newcastle United on 22 January 2019 and it shows that the club have borrowed an unspecified amount (or arranged a significantly increased overdraft facility) from Barclays Bank.
The loan is secured against both the remaining money to be received by Newcastle for the 2018/19 season from the Premier League/broadcasting, as well as against the ‘Basic Award Fund’ for the 2019/20 season.
Newcastle will bank tens of millions next season from the Premier League, even if relegated, due to the parachute payments.
It was a 50+ page document at Companies House but this is the relevant part as to how the money will be repaid:
One way or another, this money looks clearly to be intended to help finance January signings, with Miguel Almiron set to sign for around £20m, plus potentially other players, whether as buys or on loan.
Many other clubs also operate this way, though usually do it at the more sensible time of before the season starts – borrowing against the money they are guaranteed in the coming months, rather than playing catch-up once in relegation trouble.
However, Newcastle United (via September 2018 fans forum minutes) stated that they had they tried to buy a number of players in summer 2018 beyond the £16.8m 14 year old club transfer record, indicating they had the finance to do so, only for players to supposedly turn the club down.
Those same Fans Forum minutes also said that once the transfer window ended, an unspecified amount of the cash that hadn’t been spent in the summer, was instead taken out of the club by Mike Ashley against his personal ‘loans’ to his own football club.
So, whilst definitely this new loan from Barclays is to do with buying players, it is clearly also in one way or another being used to cover money Ashley has/is taking out of the club as well. Either to cover the cash he took out after the transfer window so that money is now there to pay for these signings, or even possibly for the owner to take more out now, as well as to buy players.
Newcastle United are always one of the very last to reveal their yearly accounts, Mike Ashley happy to pay the fine for filing them late. Usually they come out around April time but it was May 2018 last time for the Championship (2016/17) season accounts.
So we are unlikely to know any more for some time. Plus the next accounts due are for the 2017/18 season, so it will be largely up to the club/Mike Ashley if they want to reveal anything extra about what has has happened in 2018/19…
If you are a super optimist then you might think that with the the loan being secured against the basic guaranteed cash for next season from the Premier League/broadcasting, as well as remaining payments for this season, just maybe Miguel Almiron isn’t the only significant buy that might be made by 11pm on Thursday night, as well as any cheap and cheerful loans…
The timing of this loan is also interesting, as on 19 January 2019, Mike Ashley was at the 3-0 win over Cardiff and as previously reported, spoke to Rafa Benitez.
Once again, putting a very optimistic spin on things, Mike Ashley is potentially now making the signings which are the minimum that Rafa as demanded if he is to consider extending his stay at St James Park.
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