Debt-ridden Portsmouth given seven days to save themselves
Portsmouth have been given a seven-day reprieve to sort out their financial mess but were warned in the strongest possible terms in the British High Court yesterday they could face liquidation because they are effectively insolvent.
The Premier League club have been granted a stay of execution as they fight a winding-up petition that, if successful, would effect the whole of English football.
The end of Portsmouth FC would impact on the title race between Chelsea and Manchester United, and would also hamper Fabio Capello's World Cup plans, as goalkeeper David James would be left scratching round for a new club with the finals in South Africa less than four months away.
Portsmouth's legal team, led by Nigel Hood, attempted to play on the emotional impact that would follow a decision to force the debt-ridden club out of business. But Mrs Registrar Christine Derrett, who presided over proceedings in central London yesterday, would have none of it.
She made it clear that she fears Portsmouth are liable to run up yet more debts and added that she will not be swayed by any appeals to her better nature, saying: "I am very concerned about the financial status of this company. It seems to me there's a very real risk that this company is undoubtedly trading while it is insolvent.
"I'm conscious that, by making a winding-up order, it would have very severe consequences not only for the company as a business but for the supporters themselves, but that's not a consideration that I strictly take into account."
Portsmouth have to draw up a statement of their financial affairs by 4pm next Wednesday or will be shut down.
The club's representatives have failed to come to an agreement with HM Revenue and Customs over an unpaid tax bill. The club have a VAT bill of £7.4m which it is disputing with HMRC and also owes £4.7m in unpaid PAYE and National Insurance contributions which were not part of yesterday's petition.
Portsmouth had offered to pay £1.5m up front with the rest in instalments but the Revenue had insisted on a minimum payment of £4m.
Portsmouth's history of financial mismanagement was laid before the court. Representing HMRC, Gregory Mitchell QC said: "It's quite clear beyond any doubt at all that this company is insolvent. They have failed to provide any evidence at all as to their solvency. There are many debts and they are unpaid."
Portsmouth's 2008 FA Cup final opponents Cardiff and League One side Southend were also handed stays of executions yesterday after facing winding-up orders of their own. (© Independent News Service)