Blackburn’s owners revamp survival plans in wake of Old Trafford win
By Nick Harris
SJA Internet Sports Writer of the Year
2 January 2012
BLACKBURN Rovers are planning to make net player sales in the January transfer window - with their Canadian winger Junior Hoilett almost certain to go soon - but the sell-off may not be as drastic as envisaged even a few days ago, Sportingintelligence has learned.
Some if not all of the Hoilett receipts are likely to be made available to manager Steve Kean to recruit a replacement midfielder and possibly another striker, maybe on loan. Defenders are also on Kean’s wish list but the extent of other sales could determine whether he gets them.
Rovers would like to sell Keith Andrews, while Spanish defender Michel Salgado and striker Jason Roberts have been informed, in effect, they are surplus to requirement. Neither is being played because of contractual reasons that mean new deals would kick in with further games, as Roberts himself alluded to on Radio 5 Live on Sunday.
There is also considerable confusion over the future of goalkeeper Paul Robinson. Sources insist to Sportingintelligence that Robinson is not injured and that his recent absence from the team is not down to injury. Mark Bunn deputised for the hard-earned Christmas point at Anfield and for the astonishing win at Old Trafford on New Year’s Eve.
With the club needing to trim the wage bill, it seems plausible that relative high earner Robinson could be sold in January if a buyer can be found. There has been no response from the club to any inquiries on the subject.
None of Hoilett, Robinson, Salgado or Roberts were included even in Rovers’ squad for today's home game with Stoke.
If ‘only’ Hoilett, Salgado, Roberts and Robinson go in January, and at least two new faces arrive, many fans might see that as a positive outcome in the circumstances.
The club’s co-owner and ultimate decision maker, Anuradha Desai - matriarch of the Rao family who control Rovers’ parent company, Venky’s - had originally planned to invest no fresh cash in the foreseeable future, wanting the club to run off its own resources, including player sales and TV money. A £5.5m tranche of Premier League cash arrives this month, for example.
But the unwillingness has contributed to friction with bankers Barclays, who last month made a written then a verbal request for £10m by 31 December to alleviate potential funding problems relating to Rovers’ overdraft in the coming months. None of the £10m has been paid. (Background here).
But it is understood that Mrs Desai is now ready to make a small cash injection, perhaps of as little as £1m to show good faith to the bank, and has told advisors that a further £5m will be made available to meet running costs if necessary - once the window has shut.
The upshot is that at least Hoilett will be sold in January - as well as any fringe players who can be offloaded - but a clearout of the other most important players (defender Chris Samba, midfielder Steven N’Zonzi) is not on the agenda immediately.
The situation does ‘remain fluid’, according to one source, and circumstances could change.
Rovers’ shock 3-2 win at Old Trafford on New Year’s Eve was watched by the Rao family at home in Pune, and gave rise to a double family celebration. The older of Mrs Desai’s two brothers, Venkatesh (Venky), celebrated his 47th birthday watching on TV as his club beat the one managed by Sir Alex Ferguson, 70 the same day.
Blackburn’s accounts for the year to June 2011 were sent out minority shareholders last week. The club lost £18.6m in the year, a result of a £4.8m loss before player trading plus a £13.8m loss on player trading for the year.
The headline numbers for turnover (£57.6m), wages (£49.9m) and other operating expenses (£11.9m) can be seen in the chart of KPIs (Key Performance Indicators) for the last five years, published at the foot of this article.
Blackburn’s surge in losses was essentially down to not making any major sales in the financial year, while buying two players on a permanent basis (Rochina and Formica), making several loan deals of uncertain cost, and spending significantly larger than normal amounts on agents and consultants.
The accounts show ‘post balance sheet events’ worth £8.7m net, which in laymen’s terms is the net income due on player sales (Jones £16.5m / Kalinic £6m combined) over player buys (Goodwillie, Petrovic, Vukcevic, Yakubu, Dann and Slew).
In other words, that sextet combined cost £13.8m (or £22.5m minus the £8.7m).
All of the money for Kalinic was paid up front to Rovers, as was £12.375m of the Jones money on the day Jones officially became a Manchester United player: 1 July, and hence, post-accounts. The balance of the Jones money, £4.125m, is due on the 1st anniversary of Jones becoming a United player, while there are possible add-ons of £4m depending on success at United and England performances. Blackburn would also benefit financially from a sell-on clause should United ever sell Jones for profit in the future.
There are a number of unanswered questions about the 2010-11 accounts; the ‘reporting’ numbers will not necessarily bear close relation to the actual movement of money in any given year, for example, as can be seen from the Jones example. Player transfers are amortised for accounting reasons but in some cases monies are paid / received in full much earlier than the end of a player’s deal. Ditto agents’ fees.
What isn’t in doubt is that running Rovers is costing more than the owners envisaged when sold the proposition of an essentially self-funding club.
Hence the current difficulties, although sales plus a bit of new capital can alleviate things.
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