Thursday 23 January 2020

New FAI directors to pave way for cash bailout as 'mood music is changing'

Minister for Tourism, Transport and Sport Shane Ross
Minister for Tourism, Transport and Sport Shane Ross
Shane Ross. Photo: Damien Eagers / INM

Hugh O'Connell and John Fallon

The Government expects the appointment of independent directors at the FAI within the next 10 days to pave the way for a rescue package to save the stricken football association.

While ministers are refusing to commit to signing-off on the €18m the FAI says it needs to avoid liquidation, there is increasing confidence the imminent appointment of four independent directors, including a new chair, will pave the way for a deal between the FAI, the Government, the Bank of Ireland and Uefa, European soccer's governing body.

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The association needs an urgent cash injection to remain solvent and ensure it can pay staff wages on January 25.

Government sources insisted there had been no discussion around the details of any rescue package or whether the State would guarantee an €18m bailout from the banks.

While a direct government bailout is ruled out, the possibility of a rescue package having some level of State guarantee or assistance has not been dismissed.

The Irish Independent understands a deal could involve the banks taking a haircut on loans and the FAI putting in place a package to rationalise its spending, including job cuts.

But the Government expects that any job losses should start at a management level rather than lower-paid staff.

"The mood music is a bit better," a Government source said. "We're in solution mode now and we'll be in real solution mode if we get the independent directors on board in the next week.

"They'll be showing the leadership."

Sports Minister Shane Ross is due to meet Uefa officials when they travel to Dublin next month. They are also set to meet the FAI and Bank of Ireland.

It comes after the FAI apologised on Sunday "for the mistakes of the past" at a stormy AGM where officials admitted they cannot guarantee staff salaries next month as the association seeks €18m to meet its obligations.

But Health Minister Simon Harris questioned what the FAI had apologised for as he claimed it has been run "like a fiefdom" that "stinks and portrays an arrogance" associated with the Celtic Tiger era.

Mr Harris made the strongly worded comments yesterday as he and fellow minister Richard Bruton called for fresh leadership in the financially troubled association.

Mr Harris said the Government needs to make sure it can support Irish football, but finding a mechanism to do that will have to be carefully considered. "We can't just write a blank cheque for an organisation that we can't have confidence in," he said.

Mr Bruton said there needs to be "fresh leadership" in the FAI and the apology was "the first step in building a bridge" between the Government and the association.

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The FAI's executive lead Paul Cooke warned delegates at the AGM of an imminent threat of examinership or, worse still, liquidation.

Mr Cooke insists the survival of the FAI hinges on "round table" talks between various parties. He suggested Uefa, which advanced television money to the FAI to alleviate a cash crisis during the year, and Bank of Ireland were agreeable to assisting.

Mr Cooke denied seeking a bailout from the Government but didn't rule out it providing some form of guarantor assurance to their bankers.

"We need a partnership and it depends on the mix," he said when asked if a guarantor was essential.

"I'm not being evasive on that. There's been mentions of bailouts from government but that wasn't asked for.

"Our bankers are being very helpful. We owe them a lot of money and they've switched our loan to interest-only this year."

Irish Independent

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