FA seek £200m loan to mitigate job losses caused by the coronavirus crisis – after announcing 124 redundancies and taking a potential hit of up to £300m
The Football Association are planning to borrow up to £200million, including a significant sum from the Government, in order to mitigate losses caused by the Covid-19 crisis.
The governing body on Monday announced 124 redundancies, around 15 per cent of their staff, in response to projected losses of £75m this year, which could rise to as high as £300m if spectators remain barred from attending games at Wembley on a long-term basis.
Having begun to cut costs, the FA will now look to increase their short-term cashflow through borrowing between £100m and £200m from a combination of commercial and Government loans.
The FA are looking to borrow up to £200million in order to mitigate losses caused by Covid-19
Sportsmail has learned that the FA have registered with the Government’s Covid corporate finance facility lending scheme. This will enable them to take out a loan from the Bank of England at an interest rate of 0.5 per cent, a significantly lower rate than those available commercially.
The FA are continuing to pay off existing loans relating to the rebuilding of Wembley, which should be cleared by 2024, but will take on more debt to future-proof against further losses resulting from the coronavirus pandemic.
The loss of income resulting from the cancellation of England games, NFL matches and concerts which were due to be staged at the national stadium this summer will never be recovered.
A loss of income from sporting events at Wembley has hit the FA hard during the pandemic
The FA are also preparing to take a £35m annual hit on their hospitality business in the absence of match-going supporters.
‘It might seem that football has weathered the storm by getting the top flight men’s game playing again,’ said chief executive Mark Bullingham. ‘However, unfortunately the past few months have impacted the FA severely and we have lost a significant amount of money that we can never recoup.
‘We also anticipate that many of our future revenue streams will be affected for a considerable time.’