Kieran Maguire: Wes Edens and Nassef Sawiris forced to ‘step in’ amid £14m Aston Villa reveal
Aston Villa owners Wes Edens and Nassef Sawiris have been forced to “step in” and offset the club’s operational losses with a fresh share issue.
That is the view of finance guru Kieran Maguire, speaking exclusively to Football Insider about the latest news from behind the scenes in Villa Park’s accounts department.
A Companies House submission last Wednesday (4 January) shows the allotment of £13.5million worth of shares backdated to 20 December.
A source told Football Insider the following Friday (6 January) that the cash injection is likely to help Villa comply with the Premier League’s Financial Fair Play rules and fund activity in the January transfer window.
This site understands that the Midlands giants will post a profit in their forthcoming 2021-22 accounts, but they recorded deficits of £68.9m and £99.5m in the previous two campaigns.
Maguire explained why the share issue is necessary to make up for the club’s operational losses and to contribute to new manager Unai Emery’s playing budget.
“Villa have had operating losses of £323m over the last five seasons,” he told Football Insider’s Adam Williams.
“We have not yet seen the accounts for 2021-22. They may be marginally better.
“But given the relatively low levels of matchday income that Villa generate, which is normally in the region of £11m or £12m per year, the club is likely to incur substantial losses if it wants to be competitive.
“There was a relatively modest merit payment for the 2021-22 season. That means the club will be losing money as far as its day-to-day activities are concerned.
“To compensate for this, Edens and Sawiris have stepped in and injected money in the form of cash. The most important aspect of this is that it is shares rather than loans.
“That reduces risk, there is no obligation to pay dividends, and there are no interest charges either. That is good from the perspective of the playing budget.“
In other news, Aston Villa close in on two new signings as one deal all but done.