Saturday 21 September 2019

FAI had Dundalk's €2.2m prizemoney for 11 months

 

Former Dundalk boss Stephen Kenny with the League of Ireland trophy. Photo: Sportsfile
Former Dundalk boss Stephen Kenny with the League of Ireland trophy. Photo: Sportsfile
Daniel McDonnell

Daniel McDonnell

Dundalk received €2.2m of a European bonanza in November 2017 - almost 11 months after the bulk of it was paid by UEFA to the FAI.

Their incredible run in Europe under Stephen Kenny was the most lucrative achievement in the history of Irish club football, netting the League of Ireland side more than €7m.

UEFA give the prize money accrued from participation in their competitions to national associations - in this case the FAI - who dispense it to their member clubs.

The Irish Independent has learned that the League of Ireland champions received their last payment from the FAI in the last week of November 2017 - the same year the association's financial position has come under scrutiny in light of the €100,000 bridging loan provided to the FAI by then CEO John Delaney in April of that year.

The FAI say this loan was required due to a short-term cash-flow problem.

This €2.2m payment to Dundalk at the end of November - which was made up of three instalments - followed on from the payment of €930,000 in October.

The lion's share of that money was outstanding prize funds from the extraordinary adventure led by Kenny, who has since been hired by the FAI. It also included a €580,000 payment arising from Dundalk's brief participation in the 2017/'18 Champions League qualifiers.

The Irish Independent asked the FAI to explain the reason for the delay in releasing the last of the 2016 funds to Dundalk until November, and also requested details of where the UEFA prizemoney was held before it was transferred to the League of Ireland side.

An FAI spokesman said they would be making no comment. Dundalk have also declined to answer questions on the subject. Former FAI Financial Director Eamon Breen referred queries to the press office.

Dundalk were knocked out of the 2016/'17 Europa League group stages in December 2016.

A spokesperson from European football's governing body has confirmed to the Irish Independent that all performance-related payments for clubs who went no further than the group stages were paid out by January 13, 2017.

Dundalk were also entitled to a market share payment - with figures published on the UEFA website stating that the border club earned €582,000 from this route - with the dispensation of that amount split across January 13 and a later payment on June 9.

The Lilywhites' future was altered forever by their historic progress into the Europa League group stages, the consolation prize for losing a Champions League play-off to Legia Warsaw in August 2016.

The value of the consolation prize was €3m for falling at the final Champions League hurdle and a €2.6m Europa League group stage participation fee. UEFA payment dates released by their spokesperson show that the participation fee was paid out on October 7, 2016.

Dundalk were also due prizemoney for progressing through the early stage Champions League rounds, and won a further €480,000 on the pitch in the Europa League group stages.

Well-placed sources have indicated that Dundalk received close to €3m in the final months of 2016 with the substantial balance to be settled in 2017.

It is understood that Dundalk's then owners - businessmen Andy Connolly and Paul Brown - were keen on an arrangement where the FAI would hold onto the European money and then release it upon request in the form of staggered payments.

According to one FAI source, they "got the money when they asked for it." This claim is not disputed by Dundalk insiders with a knowledge of the relationship.

The drip feed became a problem when Dundalk were approached in the latter half of 2017 by an American consortium led by investment company Peak6.

The US delegation wanted all outstanding financial matters to be squared up so they could get a full appraisal of the situation and begin work without any creditors.

Dundalk had received money from the FAI in smaller quantities at intervals in the spring and summer of 2017.

The Irish Independent understands that the Lilywhites were paid close to €275,000 by the FAI in April 2017 - again in three instalments.

This is the same month that Delaney gave his employer the loan.

Dundalk received further instalments across the summer months, but were still owed in excess of €3m when negotiations with their prospective owners reached an advanced stage.

Sources close to the deal say this led to a more urgent request to the FAI for the release of the outstanding amounts.

There were concerns that the US takeover would collapse if their financial picture wasn't up to date, and Dundalk looked for the remainder to be paid up in full.

After discussions, the FAI paid out the balance of UEFA money owed to Dundalk from 2016 and 2017, and any other outstanding payments.

This concluded with the transfer of €2.2m at the end of November which paved the way for the Peak6 deal to go through.

The FAI's financial position in 2017 will be one of the topics covered in Oireachtas hearings scheduled for this week and next week.

Sport Ireland will go in front of the Committee on Sport today and outline that the FAI has not sufficiently explained the circumstances around the payment made by Delaney.

Last week, former Ireland manager Brian Kerr raised questions about the speed with which FAI release prize funds to recipients.

Irish Independent

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