Portsmouth move closer to entering administration

Portsmouth will go into administration by Friday unless a buyer is found for the Premier League's bottom club.

If Pompey enter administration they will be docked nine points, but the winding up order against them due to be heard on 1 March will be suspended.

A spokesman for Pompey owner Balram Chainrai said: "There is now only a short window of opportunity for buyers to come in with a credible offer.

"Having the club wound up is not an option as far as we are concerned."

Portsmouth have debts of £70m, and the winding up order was over £7.5m owed to HM Revenue and Customs.

Chainrai's spokesman Phill Hall said: "The serving of this notice [that Portsmouth intend to appoint an administrator] means the winding up order is automatically suspended.

"It means the club is safe, it can fulfil its fixtures and as far as is possible it is business as usual."

Hall admitted that a nine-point penalty would make Portsmouth's relegation to the Championship at the end of the season "almost certain".

But he claimed: "Administration would mean the club re-emerging as a healthy financial entity.

"It would then become an attractive proposition for a potential buyer who could invest new funds in rebuilding the club's future."

He added: "We would like to ask the fans, staff and management of Portsmouth for their support and patience should this step be taken as we believe it is the only route left open."

One of the parties interested in buying the troubled club has revealed he will not be able to take over the club ahead of Monday's winding up petition.

New Zealand-based businessman Victor Cattermole is considering buying Pompey through his investment group but told The Guardian newspaper: "In an ideal world, we would like to purchase the club before Monday, but we will not be rushed."

Cattermole's group is one of three potential buyers for the south coast strugglers.

Chainrai recently became Portsmouth's fourth owner of the season, taking 90% of the club shares after the previous owner Ali Al Faraj defaulted on loan payments due to him.

Eight points from top-flight safety, Pompey's financial woes have meant their players have been paid late on four occasions this season.

Entering administration would leave them 17 points from safety, with only 12 matches remaining to preserve their Premier League status.

The club are also involved in a separate dispute with former owner Sacha Gaydamak over whether they have missed a deadline in paying a £9m chunk of the £28m they owe him.

The Premier League recently withheld £2m of transfer payments and a £7m slice of TV revenue to divert to Chelsea and Watford for the signings of Glen Johnson and Tommy Smith respectively.

The Fratton Park club are also being sued by former Pompey defender Sol Campbell for £1.7m for unpaid image rights.

Earlier on Monday, another former owner Sulaiman Al Fahim quit as non-executive chairman and offered his 10% stake to the Pompey Supporters' Trust.

Ken Malley, a member of the Football Supporters' Federation who is on the PST working committee, said: "As a fan, I'd rather we didn't go into administration.

"There's an awful lot of small businesses that lose out terribly if we do, so I'm not happy about that side of things.

"I'm just anxious that sooner or later we get some owners that are transparent and attempt to work with the community and the fans.

"If we get owners that do then we will be more than happy to work with them.

"There'll always be a Portsmouth FC, whatever happens. A lot of work has gone on behind the scenes to make sure that a phoenix would rise from the ashes in time for next season."

Posted at 09:05PM Feb 23, 2010 by Kelly Board in Insolvency  |  Comments[0]

Mortgage Approvals Slump in January

According to the British Bankers’ Association (BBA), the number of mortgages that major banks are agreeing with home buyers suffered a sharp fall in January.   The fall is thought to be due to the re-introduction of a lower stamp duty threshold beginning at the start of the year.  This led to more buyers borrowing in December.

35,000 new mortgages were approved by the BAA’s members last month, 11,000 less than December. This drop saw the total mortgage lending also plummet to £8bn, this was an eight and a half year low.

Another reason thought to have discouraged would-be buyers is the cold snap that hit the country in January. 

The BBA's statistics director, David Dooks said, "It was no surprise to see the January mortgage figures falling back from December, when transactions were being pushed through to beat the end of stamp duty relief.

"There was a natural reaction in the January figures and the bad weather further suppressed market activity," he added.

The BBA’s figures have reaffirmed previous ones published by the Council of Mortgage Lenders (CML) last week.  They also said that the government’s temporary stamp duty holiday has caused a rush to buy in December which caused the knock on effect of January’s low rates.

Melanie Bien, of Savills Private Finance, said: "There has been a big hangover from the stamp duty holiday."

And she added: "The very poor weather conditions meant everything ground to a halt."

However, Bien also thinks there will be a recovery in numbers over the next couple of month as the market hits their busiest period.

On a positive note for the housing market, as house prices begin to rise once more, the Newcastle building society has launched a new range of mortgages.  These are designed to target first time buyers.

The Newcastle are offering mortgages requiring just a 10% deposit, at an interest rate of 5.95% for a two year fixed rate deal, or 4.% on a two year tracker.

Newcastle have also stated though, that the deals aren’t available to everyone, as funds available for the deals is limited.

Ray Boulger, of the mortgage lenders John Charcol, said: "Both deals are certainly pretty competitive."

Posted at 02:02PM Feb 23, 2010 by Marc Stenton in Mortgages & Housing Market  |  Comments[0]