Argyle on brink as crisis deepens

02 March 2011 02:22
Plymouth Argyle will be forced into administration, perhaps as early as Friday, unless the League One club receives an immediate cash injection.With no sign of the £5m needed to see the season out - and total debts of £10m - the board meets on Friday. [LNB]The club's two Japanese-based directors have promised £1.4m from a new investor but BBC Sport understands that will be swallowed by overdue pay and taxes. [LNB]And with Argyle due in court on Monday, administration looks almost certain. [LNB]The club filed a formal notice to appoint an administrator last week. This resulted in a 10-point penalty from the Football League - sending Argyle to the bottom of the table - but stopped HM Revenue & Customs (HMRC) from applying for court-enforced administration over the £300,000 it is currently owed. [LNB]That tax debt will double the moment Argyle pay the £725,000 in wages they owe for January and February and, to make matters worse, the protection from HMRC action only lasts until Monday's court date.[LNB]Argyle could be forced to sell their Home Park ground and lease it backThe sense of crisis at Home Park is compounded by the fact that Peter Ridsdale, the former Leeds United, Barnsley and Cardiff City chairman who has been advising the board since December, has announced he can no longer work with the club's board. [LNB]Ridsdale is believed to have become frustrated at the repeated broken promises coming from Yasuaki Kagami and George Synan, as well as serious rifts emerging amongst the club's four remaining UK-based directors. [LNB]Kagami and his American-born business associate Synan own 38% of the club. The pair arrived at Home Park in 2008 and a year later formed a "New World" partnership with Sir Roy Gardner and Keith Todd, who own 13%, to take control of the club. [LNB]At that time, Argyle were an established Championship team with hopes of developing the ground as part of England's proposed staging of the 2018 World Cup. [LNB]Those plans now seem ludicrously ambitious as Russia won the right to stage the World Cup and Argyle were relegated, prompting a financial reckoning the over-extended Pilgrims have been battling ever since. [LNB]Argyle successfully dodged an HMRC winding-up order for £760,000 last month. Key to that near-miss was a two-month grace period granted by the High Court in December after Kagami and Synan promised they would inject £2m into the club in four £500,000 instalments. [LNB]Three of those should have arrived already but none has come. Kagami has also refused to comment on the club's predicament and Synan has failed to honour numerous promises to come to the UK to help solve the crisis. [LNB]It is against this backdrop that the pair have told club staff a London-based Japanese associate called Koichiro Abe - a former Goldman Sachs banker - will buy out Gardner and Todd's stake for £1 and pump in £1.4m. [LNB]Ridsdale, however, believes a figure more than twice that sum, £3m, is the minimum required to stave off administration. Among the club's most pressing debts are £350,000 owed to Inscapes, the firm responsible for Argyle's Fifa-standard playing surface, and a £150,000 instalment on the money mortgaged against this and next year's season-ticket sales. [LNB]All is not completely lost, though, as Ridsdale claims to be in advanced negotiations with two parties interested in buying the club and in preliminary talks with a third group. There are concerns, however, that none of these will act until the club is in administration. [LNB]But BBC Sport understands a potential rescue proposal from a different bidder will be formally made on Wednesday. [LNB]The precise terms remain unclear but it will depend on the club's main creditors - all current or former members of the board - to write off a significant chunk of their loans, as well as the sale and lease-back of Home Park.

Source: BBC_Sport