English Premier League club, Arsenal have announced that they have met the criteria set by Bank of England in order for them to be eligible to receive a COVID-19 loan.
The club, which has struggled to meet up with some of its legal obligations since the pandemic, said they are now to receive £120million from the Bank, having met the criteria.
Arsenal in a club statement posted on their official website, Arsenal.com, stated why they have made the move to take up the short-term COVID-19 loan. The club said:
“As we continue to work through the implications of the global pandemic on our finances, we can confirm today that the club has met the criteria set by the Bank of England for the Covid Corporate Financing Facility (CCFF).
As a result, we are taking a short-term £120 million loan through this facility to partially assist in managing the impacts of the revenue losses attributable to the pandemic. This is a similar approach to that taken by a wide variety of major organisations across many industries including sport, and is repayable in May 2021.
The CCFF is designed to provide short-term finance at commercial rates during the pandemic to companies that have strong investment ratings and which make significant contributions to the British economy.
The CCFF is in addition to the loan provided by our owners Kroenke, Sports & Entertainment that enabled us to refinance the debt on Emirates Stadium in August last year,” the statement said.
The statement and move by Arsenal to seek the COVID-19 loan is not coming as a surprise, as the club in a statement in 2020, announced that the club is in a perilous financial situation, due to the coronavirus pandemic. The club even declared 55 staff redundant in order to manage the situation.
The COVID-19 loan from Bank of England is yet another step to save the situation and them remaining in the Premier League with their huge wage bill.
On Wednesday, August 5th 2020, the Club Chiefs Raúl Sanllehi and Vinai Venkatesham. Both in the joint statement admitted that they have been ‘hit severely’ by the coronavirus crisis, despite qualifying for Europe and cashing in by winning the FA Cup.
The club said they needed to do the necessary things in order to make sure the club ‘operates in a sustainable and responsible way’.
Mesut Ozil who is still at the club, earns £350,000-a-week, Willian who was brought in from Chelsea is also on £240,000-per-week. And Captain Aubameyang who recently renewed his contract is taking home over £200,000 per week. The club is likely to let go of some players who are struggling with their contracts at the club, for example, Folarin.