Kieran Maguire: West Brom fans will be livid as £5m ‘transfer budget’ blow on the cards
West Brom fans will not be pleased to hear that Guochuan Lai plans to pay off a historic £5million debt using the club’s own money.
So says finance guru Kieran Maguire, speaking exclusively to Football Insider about recent developments behind-the-scenes at the Hawthorns.
The club plans to shell out £5m in repayments for a loan granted to former owner Jeremy Peace in 2014 by the end of this month.
Per The Athletic last Tuesday (25 January), current majority shareholder Lai plans to settle the debt using cash from Albion’s own revenue streams.
The Baggies confirmed on Wednesday (2 February ) that Lai had enacted a major boardroom reshuffle, naming himself as the new chairman.
That news came just hours after the club dispensed with the services of manager Valerien Ismael, who has now been replaced by Steve Bruce.
Maguire analysed the new regime’s plan for the £5m debt and how it could directly affect the transfer budget.
“West Brom are in receipt of parachute payments still,” he told Football Insider‘s Adam Williams.
“We have seen it all before with Huddersfield and Burnley in that deals have been structured from payments from revenue streams.
“I suspect fans would rather those funds be spent on the transfer budget, but it is a facet of modern football business.
“It’s a historic debt and it needs to be repaid at some point.
“When the parachute payments cease, it will be that much more of a challenge because where will the money come from?
“If you have got debt on your balance sheet, you’ve got to get it down sometimes.”
Bruce’s first game in charge comes against Sheffield United next Wednesday (9 February).
Albion are currently 6th in the Championship table.
In other news, pundit suggests West Ham could sign Sam Johnstone from West Brom for “cheeky” £5m after manager reveal.