Writer: Nick Simmonett
Date:Wednesday June 13 2007
Arsenal Managing Director Keith Edleman today announced in The Daily Star that Arsenal will borrow a further £40Million to fund Arsene Wenger's transfers.
Arsene wenger was said to be upset at the lack of funds made available for him by the board, and in turn Theirry Henry has become upset with the 'lack of ambition' the club has shown in terms of spending.
Henry has stressed since he signed a new 4-year deal last summer that Arsene needs to invest cash in experience for the squad. Something Wenger did last season when he brought in William Gallas and Julio Baptista.
Gallas spent most of the season on the treatment table, while Baptista struggles to settle in England. This prompted further upset from Henry, and is one of the reasons touted by some for his refusal to commit himself to Arsenal.
Could this be the reason that Arsenal have been forced to take on another £40Million worth of debt?
It was only a couple of days ago that The Arsenal Supporters Trust stated how important it was not to borrow in order to fund transfers.
But just a matter of days later, Keith Edleman had this to say to The Star: 'A football club should not borrow to buy players.
'However, if you are building a fixed asset - such as our stadium - which produces a positive return after you have paid back the debt, then this a sensible approach.
'The reason we have a trading facility was because we would be disadvantaged without it if we wanted to sign players.
'We were concerned that with our debt, clubs would not take our credit.
'This facility allows us to cover the fact we may have to give a letter of credit to back up second and third year payments to guarantee payment.'
Now, my knowledge of business is limited to a double B at GCSE level, and I do believe in the saying that you have to speculate to accumulate, but Arsenal's level of debt, now around £280Million, is quite concerning.
Arsenal Holdings PLC did extend the debt facility of the club by a further £100Million last summer, but that was put in place primarily to fund the Highbury Square development.
If Henry is a major factor in this further borrowing, I have to ask: 'Is Henry worth that much to us?' I wont give my opinion on it either way.
But as I said, my knowledge of Business is very limited, I'm sure the board know best.
At least I hope they do!
Date:Wednesday June 13 2007
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