Burnley has taken out a £12.5 million loan due to recent worries over the club’s financial viability, according to sources.
The announcement came after the club’s records for the fiscal year ending June 30, 2021, which showed the importance of the club’s leveraged buyout by ALK Capital in December 2020.
Following the release of those accounts, it has been stated that Burnley would be required to repay a major chunk of a £65 million loan used to support the club’s buyout if they are demoted from the Premier League before 2026.
Many Clarets fans are apprehensive as a consequence, while chairman Alan Pace says that the controversial way of acquiring the Premier League club is viable and does not pose a threat.
However, LancsLive reports that the Lancashire club has taken out a fresh £12.5m loan to aid with financial flow.
The loan is related to the January sale of Chris Wood to Newcastle United, with the striker transferring to the North East for £25 million after the Magpies activated a release clause in his contract.
According to the report, Eddie Howe’s side were not scheduled to pay the second instalment of £12.5m until February 2023, but Burnley borrowed the money up front from Australian business Macquarie Bank.
The loan will be returned with interest, and although this helps Burnley’s short-term finances ahead of the summer transfer window, it raises concerns about the club’s long-term financial plan.
