The High Court today granted Portsmouth Football Club its application to go into administration for the second time in two years. However, UHY Hacker Young have been replaced by PKF as the administrators.
Events in court today saw the club's desire to keep Andrew Andronikou in charge rejected as HMRC, Portsmouth North MP Penny Mordaunt and Portsmouth City Council all pushed for PKF to take the reins, with Trevor Birch and Bryan Jackson favoured by Judge Justice Alistair Norris.
HMRC told the court that keeping Andronikou on as administrator would be a conflict of interests as his firm are also the administrators of CSI. Balram Chainrai seemed desperate to keep Andronikou at the club as he offered Pompey £500,000 to ensure PKF weren't appointed.
Judge Norris offered UHY and PKF the chance to work together but the latter flatly refused as they have "very different ways of working" and believe an independent administrator is fairest on creditors.
Thankfully, to the delight of Pompey fans everywhere, PKF is the new administration firm tasked with finding a new buyer for the club as well as steadying the club financially.
It seems like the club are in good hands as Birch is a former footballer and has been the C.E.O of clubs such as Chelsea, Leeds and Everton.
Jackson has 32 years of corporate recovery experience and specialises in recovering football clubs, having been the administrator of four Scottish clubs in the past.
As for the administration penalty, it could be as much as 20 points depending on what the Football League decide but nothing is certain yet.
The deduction is surely going to be at least 10 points but there is talk that the Football League are reluctant to increase the punishment as Pompey's problems are partially their fault because of their farcical "Owners and Directors" test.
Going into administration means that Pompey's account has now been unfrozen and the £2 million can be used to pay the staff in the short-term. Just how the club continues to fund its running costs is just one of many tough questions that PKF will have to answer in the coming weeks.
So, Pompey ans will be happy with what was surely the best possible outcome. Portsmouth FC hasn't been liquidated, UHY Hacker Young are on longer in charge of running the club and who knows what the new people will discover about Chainrai's involvement with the club.
However, this optimism should be greeted with the greatest of caution. After all, this football club couldn't even afford to send its players to Barnsley earlier today whilst the gas and electric company threatened to withdraw their services to Fratton Park for the rest of the season.
The club only has £17 million over three years in parachute payments as guaranteed income and there is likely to be more job losses and other as Birch and Grayson look to cut Pompey's cloth accordingly.
PHK has a massive job to do but ousting Andronikou and Chainrai is hopefully the first step in Pompey's long and difficult recovery.
Source: FOOTYMAD
