QPR Secures Bank Loan, Will Look To Restructure Player Contracts To Reduce Debt
EPL club Queens Park Rangers secured a $22.87M (all figures U.S.) "loan from Barclays Bank in Hong Kong last month, charged against all the club's assets," including its stadium, while "significantly borrowing for the first time during Tony Fernandes's regime as majority owner," according to James Riach of the GUARDIAN. Fernandes and his partners finalized the loan on March 18 "in agreement with QPR's remaining shareholders -- the family of the Indian steel magnate Lakshmi Mittal." However, with QPR approximately $137.2M in debt, club supporters may be "concerned at the shift in approach." Fears have "grown that the club will face serious financial difficulty if they are relegated" at the end of the season. Fernandes "denied that QPR would be crippled by relegation." A new stadium "holding 40,000, more than double the capacity of Loftus Road, has been in the offing but any move is likely to be a distant possibility with more pressing concerns regarding QPR's immediate future." However, "more progress has been made in recent months" (GUARDIAN, 4/17). In London, Gary Jacob notes QPR's "wage bill rose" from $42.0M to $89.2M in its first year back in the EPL in '11, and it is "thought to be closer to" $129.6M this season. The club claims that it "took out the loan to test the water ahead of a proposed new 40,000-seat stadium, which is likely to have a roof in order that it can be used for pop concerts" (LONDON TIMES, 4/17).
INCENTIVE PLAY: The TIMES' Jacob notes QPR execs plans to "introduce incentivised contracts for new players in the summer to overhaul their finances." The club will offer "relatively low basic salaries boosted by extra payments for appearances, possibly linked to" where QPR finishes in the league. The team believes that the contracts will be "easier to introduce" outside the EPL -- "accepting that they will be relegated this season -- and hope that it would avoid a situation where they are paying players fixed sums for not even sitting on the substitutes' bench." The difficulty will be to "persuade players to accept the contracts and to avoid a division with those squad members on existing deals" (LONDON TIMES, 4/17).