What? Why? And How? – ‘There’s certainly nothing to panic about’ regarding Dejphon Chansiri’s charge over Sheffield Wednesday’s Hillsborough

There’s a collective holding of breath whenever a story breaks regarding Sheffield Wednesday and finances, and last night was no difference.
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It was reported by BBC Radio Sheffield that Wednesday owner, Dejphon Chansiri, ‘is securing a debt against Hillsborough Stadium’, with fans worried what it would mean for SWFC’s home ground.

We spoke to football finance expert, Kieran Maguire, for a breakdown on the situation, explaining what’s happened, why it might have happened, and whether there’s any need to worry.

Over to you Mr. Maguire:

What’s happened?

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Nothing has happened to Sheffield Wednesday Football Club at all… That’s the first thing.

But Sheffield Wednesday don’t own Hillsborough Stadium, that’s owned by a company called Sheffield 3.

Sheffield 3, from what we can make out, hadn’t paid the club for the stadium yet, so how they were going to pay for it has never really been quite explained.

Sheffield Wednesday's Dejphon Chansiri is securing a debt against Hillsborough. (Photo by Matthew Lewis/Getty Images)Sheffield Wednesday's Dejphon Chansiri is securing a debt against Hillsborough. (Photo by Matthew Lewis/Getty Images)
Sheffield Wednesday's Dejphon Chansiri is securing a debt against Hillsborough. (Photo by Matthew Lewis/Getty Images)

We haven’t seen the accounts for two years now, so nobody exactly knows what’s going on, but Sheffield 3 owed the club £60m for the stadium, and that’s fine.

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Me and you could agree on selling something and could say, ‘Well, I’ll pay you later, and that would be fine.

What now appears to have happened is that New Avenue Projects Limited have a charge - which effectively a mortgage - over Hillsborough Stadium.

You wouldn’t give somebody a mortgage over your property unless you were getting something in return. The chances are is that this company has lent money to Sheffield 3 so they can pay off the stadium, and again, that’s fine.

Why use a broker like New Avenue?

If you or I were going for a mortgage then we’d just toddle along to a bank or building society, but it could be that this company could get the money borrowed at a cheaper rate. We don’t know the interest rate.

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I have spoken to people in banking who say they don’t want to lend to football clubs, because if you lend and they can’t repay and you have to send the bailiffs in, you lose the goodwill of all of that club’s fans.

So it could be that they’re using New Avenue is because it creates a buffer between the bank and the club. And you can see the sense in that.

Is there any need to worry about it?

There’s no difference between this, and you or I getting a mortgage on a house. Provided you make the monthly repayments. We’re happy, we’ve got the house, and the bank’s happy because they’ve got their payments and are making a bit of money. It’s a commercial deal.

Why Mr. Chansiri is not using his own money is none of my business.

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It could be that what Mr. Chansiri wants to do is instead of - what appears to be - paying £7.5m every year to Sheffield Wednesday Football Club, it could be that he wants to give them all of the £60m now. Which could be seen as really good news.

That’ll improve their cashflow, for people on furlough, it could help them in the transfer window for the next couple of years. So if he’s accelerating cash into the club, that’s good news.

There’s certainly nothing to panic about.

The club were contacted but will be making no comment at this time.

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