All but a few Super Lig clubs are drowning in debt. The new plan to help solve the financial woes of clubs could be their long-needed lifeline.
Turkish Football Federation (TFF) chairman Yildirim Demiroren has described a plan aimed at restructuring the country’s football clubs’ debts, estimated to be around 10 billion Turkish Liras, as a “milestone.”
“The deal the TFF has struck with the Turkish Banks’ Association [TBB] will strengthen the clubs’ financial and administrative structures and represents a strong contribution to Turkish sports,” Demiroren said during a televised interview on January 7.
He reiterated that the envisaged plan is all about the restructuring of the existing debts.
The total debt of the “Big Four” clubs in the Turkish Super Lig is more than 10 billion lira ($1.57 billion), exacerbated by worsening domestic and international performances.
“Our clubs have lost credibility. Thus, given this unfavorable situation, restructuring is a must. We are talking about a debt standing at around 10 billion liras. They are all bankrupt. If those clubs were regular businesses, most of them would not be able to take out loans from banks. This restructuring is a milestone and time will prove us right. The arrangement will create a breathing room for the football clubs,” he explained
The plan is not designed to intervene in the clubs’ management, he added.
A similar system was implemented in Spain and worked, according to Demiroren.
“The playing will be leveled under the restructuring scheme. Larger clubs will not take out loans. They all compete under equal terms.”
Business relation
Speaking on the same TV broadcast, Huseyin Aydin, the general manager of the state-run lender Ziraat and TBB’s board chairman, said that as banks they are doing business and the football clubs were their clients.
“We are aware of the problems of the [football] industry. We have been discussing possible remedies for some time,” he added.
Aydin noted that Ziraat Bank is not the only lender that provides loans to the football industry, dismissing criticism that the bank is shifting focus from the agriculture sector to football clubs.
“We are still engaged in the agriculture sector. There are more than 15 financial institutions that extend loans to the football industry,” he said.
Echoing Demiroren, Aydin reiterated that “we will not take over the management of the clubs.”
According to Aydin, the revenues of Turkish clubs are strong and the Turkish league is one of most valuable leagues in the world.
“The annual revenues of the big clubs are around 600 million liras. The problems have accumulated over the years. Some of the clubs are not even able pay the interest of the loan, they have lost their control over their budgets,” he said.
The Big Three are the clubs that have racked up the most amount of debt, unsurprisingly.
Fenerbahce, a regular contender for the league title in previous years, sits in 17th place with just 16 points from the first half of the season. The club has debts of nearly 4 billion TL (€631.9 million).
Galatasaray’s debt, according to the club’s latest reports, stood at 2.97 billion TL (€469 million).
Besiktas, who went on a spending spree that its chairman dubbed the “Sacrifice” in recent years, are 2.49 billion TL (€393 million) in debt.
Not all 18 football clubs competing in the Super Lig are debt-stricken, however. Istanbul Basaksehir, Kasimpasa, Sivasspor and Goztepe are doing well financially, managing to make payments on time and currently running almost debt-free.