Burnley’s owners have delayed making payments owed to former directors which are required to complete their takeover, raising new fears about the club’s financial position.
Sportsmail has learned that ALK Capital have renegotiated the payment schedule of their £170million takeover, with fees worth tens of millions owed to former owners Mike Garlick, John Banaszkiewicz and five other smaller shareholders that were due to be paid last year now deferred until April.
Sources have revealed that payments have been delayed to give ALK time to secure more investment which has largely proved elusive since they agreed to buy 84 per cent of Burnley 12 months ago.
Another source pointed out that the revised schedule will take the payments into the next financial year, potentially enabling the owners to defer millions in tax.
ALK declined to explain their reasons, but it gives the owners a chance to find other income. A huge TV rights fee is due to the club this month, for example, or Burnley could raise further funds in this transfer window. They have already sold Chris Wood to Newcastle for £25m.
Burnley fans would be alarmed by the buyout being funded by TV payments and player sales, although this does fit a pattern of ALK’s ownership.
The Delaware-based investment firm agreed an unusual takeover deal last January, largely financed by borrowing and the club’s own resources. ALK initially only put in £15m of their own money, with the rest of the funds coming from a £60m loan and Burnley’s own bank account.
The initial payment to Garlick, Banaszkiewicz and Co totalled about £102m, with the rest to be paid in three instalments. The club reverts to the previous owners if payments are missed, although the revised schedule was agreed by all parties.
ALK have found Burnley a difficult sell given the club’s limited commercial clout. The chances of bottom-placed Burnley losing their Premier League status makes the task of attracting investors even more difficult.
ALK declined to answer Sportsmail’s questions about the payment schedule, other than insisting that all parties are aligned and abiding by the terms of the sale.