Derby County are already in hot water with the EFL over the sale of Pride Park to themselves. This sale generated funds of £80m. The EFL view is that Derby County overvalued Pride Park by £30m. Now an article by The Athletic’s Ryan Conway and Matt Slater throws new light on the issue.
Derby were charged by the EFL with breaching spending rules. This was said to have been a loophole exploited to circumvent the EFL’s Profit and Sustainability rulings. The EFL’s stance is said to be that the sale of Pride Park by Derby, effectively to themselves, turned what would have been a loss over a three-year span into a profit.
Clubs are allowed to make a loss of £39m over any three-year span without incurring any penalty from the EFL. With Derby County allegedly overvaluing Pride Park, what has happened is that a potential failing of the FFP regulations from the EFL has allegedly been avoided. It is a charge that Derby County contest and one they are willing to fight in court.
The Athletic’s Conway and Slater throw another log on the fire with news that the loan for the purchase of Pride Park came from a company owned by Swiss-Turkish financier Henry Gabay who was arrested in France and faces extradition charges to Germany in connection to a tax scandal that is in no way related to the situation regarding the purchase of Pride Park by Derby County.
The Athletic’s article stresses that there is no direct link between the arrest of Gabay and Derby County but they do say that the following is of interest to Derby County fans:
“According to documents on Companies House, Morris’ Gellaw Newco companies have borrowed £81.1 million in two separate payments from Rams Investment, a company set up by Duet Group owner Gabay.
The loans from Rams Investment Limited were signed off in November 2019 by Amit Haria, Gabay’s chief financial officer who is listed as the director of Rams Investment. The company, along with Rams Sports Management Limited, is listed at Gabay’s London address. The Swiss-Turkish businessman is also listed as a person with “significant control” with both companies.“
Morris has and will maintain, that Derby County have done nothing wrong in what they did in purchasing Pride Park and there is certainly nothing wrong with borrowing the money from anyone willing to lend them it. However, the EFL’s bone of contention is that the Rams overvalued the purchase.
That is a charge that is yet to be decided and one that could result in a points deduction for the Rams.
