Southampton Hit By Suspension Of Shares
Coca-Cola Championship club Southampton is facing the prospect of going into administration and being docked points after trading in shares in the club’s parent company was suspended.
Southampton Leisure Holdings plc says it needs extra money to have a future although it is possible that moves to put the club’s parent company, rather than the club itself, into administration will save it from triggering the automatic 10-point deduction imposed by the Football League.
Southampton are currently second from bottom of the Championship, three points adrift of safety.
While talks with a number of parties are ongoing, the company said it was required to suspend its shares because the uncertainty had prevented it from posting half-year results before this week’s three-month deadline.
Last October, SLH’s bank Barclays significantly reduced the company’s overdraft facility meaning that the club is now threatened by liquidation and could drop out of the Football League, if SLH fails to attract new investment by the end of the summer.
The business is heavily in debt after spending more than £30m on the 30,000-seat St Mary’s Stadium, where they moved from The Dell in 2001, before being relegated from the Premier League in 2005.
It has debts of £27.5m, reportedly made up of financial liabilities of £23.1m and an overdraft of £4.4m. Share dealing was suspended with the SLH price at 9.5p, down from 34p a year ago.
