January 8 – Turkish Super Lig clubs have been handed a financial lifeline via a deal brokered between the country’s banks and the football federation to allow clubs to restructure their debts.
Turkish clubs collectively have about $2 billion of debt that they are struggling to maintain interest payments on after the Turkish Lira collapsed by 28% against the dollar making it difficult for them to service foreign currency loans.
Spending on high profile players to stay competitive, particularly in European competitions, has long been out of control in Turkey. Under the new arrangements the banks will draw up separate plans for each club while the federation will become more involved in their financial management.
The banks emphasised that the financial lifeline would not see club debts erased or restructured at a discount to market rates.
Yildirim Demirören, the chairman of the Turkish football federation, told the sports channel A Spor: “Our clubs no longer have sustainable finances. Now their debt will no longer increase. Clubs will be offered the chance to breathe.”
All clubs in the Super Lig reported losses last year with the big three Instanbul clubs of Galatasaray, Besiktas and Fenerbahce labouring under debt of 750.8 million liras, 1 billion liras and 2.1 billion liras respectively. Black Sea club Trabzonspor has debt of 741 million liras.
All four clubs are quoted on the Istanbul Stock Exchange and the Financial Times reported an immediate uplift in their share prices on the news of the deal on Monday.
Galatasaray ended the day 7.4% higher, Besiktas shares gained 5.7%, while Fenerbahce was up 4.1% and Trabzonspor 1.3%.
Turkish club football is highly politicised with Turkish president Recep Tayyip Erdogan, a former semi-professional player himself, taking a close interest in the game, and frequently using it as a tool to enhance his political popularity.
Currently top of the Super Lig is little known Instanbul club Basaksehir, run by allies of Erdogan and believed by rivals to be a political tool in the making. Basaksehir could benefit from the financial restrictions imposed on their giant rivals as they bid to become only the sixth side to be crowned champions since the league began in 1959.
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