Salford must produce extra funds stadium deal promises to avoid fire sale
SALFORD have been told to stop a fire sale by showing the money the transformative new stadium deal promises – sharpish.
The Red Devils finally learned on Friday the city council’s £7.7 million buyout of partners Peel had gone through after 10 months of delays.
But even that may not be enough to halt Paul Rowley’s stars having to leave after Rugby Football League financial experts examined their books.
Commercial agreements waiting to be activated can now be – after hold-ups cost the club three – and an advertising screen facing the neighbouring M60 motorway can be put in.
However, sources say the quickest way that can properly be prevented is by an investor coming in as three parties are currently going through due diligence.
For even though the council’s deal promises to open up new revenue streams, they will not be counted until cold, hard cash comes through the door.
It is believed the authority’s decision to pull a subsidy control grant at the beginning of November, after it had been promised earlier, contributed to a financial shortfall and a demand for an advance of Salford’s central distribution money.
Prioritising other services was behind the call but that meant enhanced special measures and the RFL’s director of finance Rob Graham and two independent experts, including former Wakefield chief executive Michael Carter, looking at the books.
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As things stand, they have told them to cut their budget by up to 40 per cent – and SunSport has been told the promise of extra money the stadium buyout can bring means nothing. Only seeing it in Salford’s bank account will.
And the quickest way to solve the issues is to get a new investor or takeover sorted, with insiders hoping a deal is done by the start of the season in February.
SunSport understands no players nor Rowley approached club bosses demanding, ‘What’s going on?’ before the stadium deal, which includes the land around it, was completed.
Salford’s City Mayor, Paul Dennett, told how their new asset – of which Sale Sharks RU are primary tenants – can make money, with deals for land likely to cancel out a large portion of the £37 million debt the holding company has.
He said: “What we needed to do was wholly acquire it to properly sweat that asset, to generate a true community stadium for the city.
“This is no different to us putting money into a theatre and art gallery. It’s no different to putting money into the Halle Orchestra, when the BBC moved here.
“Salford should have access to these culture, leisure and sporting facilities, it’s right and proper we do that.
“Absolutely, I feel the stadium can perform an awful lot better. Have I been frustrated? Yes, I have.”