Derby’s administrators admit more “pain” is on the way for the cash-strapped basement Championship outfit with further points deductions, redundancies and relegation on the cards
Derby’s administrators admit the club is facing likely relegation with further points deductions looming and pay cuts and redundancies for staff.
The Rams prop up the Championship after being hit with a 12-point deduction for formally entering administration.
Andrew Hosking, Carl Jackson and Andrew Andronikou of business advisory firm Quantuma are now running the club and looking for new owners.
It follows chairman Mel Morris’ decision to file for insolvency after blaming £20million in lost revenue due to Covid.
Administrators reckon six serious bidders have already come forward after Morris pulled out over monthly losses of £1.2m.
County expect to meet this month’s payroll but beyond that admit fresh funding and cutbacks will be needed since Derby missed out on promotion in the 2019 play-off final.
Hosking said: “We have substantial creditors.
“There will be a number of redundancies sadly.
“I am conscious of a comment made to me by a Championship chairman who said it was the only league in the world where they play Russian Roulette every season.
Jon Hobley/MI News/Getty Images)
“The Championship is where clubs wish to compete with the aim of promotion to the Holy Grail of the Premier League with its vast sums of money.”
As well as being hit with an automatic deduction for administration, the EFL is also looking to dock the Rams potentially nine more points for breaking FFP rules.
Derby as well have a suspended three-point penalty hanging over them if they are late paying wages again.
Jackson admitted: “We have opened a very positive dialogue with the EFL, they want to see Derby County survive.
“But there is a distinct possibility there will be further points deductions.
“Prospective owners are fully aware that the likelihood is – unless Derby have a fantastic remaining season – they will drop into League One.
“Particularly with the risk of further points deductions.”
Hosking explained they are looking to conclude the EFL’s row with the club over more potential deductions before a new buyer takes over.
He said: “We’d want to have clarity with the EFL and have that effectively encapsulated.
“We wouldn’t want to be passing that on to a prospective purchaser.
“We want certainty and we don’t want a prospective purchaser then having to divert his attention to try and get a solution with the EFL.
“The pain needs to be dealt with and dealt with in one fell swoop. That’s where we’re at with the EFL.”
But Hosking insisted he was confident the club would survive and avoid going out of business like Bury.
Now they are trying to secure short-term funding to help Derby continue to trade until a sale can guarantee its long-term future.
HMRC are a preferential creditor over debts of £26m but both the ground and training ground are on leases and not assets.