Derby County won their second game of the 2021/22 EFL Championship season on Saturday night, coasting to a 2-1 win over Stoke City at Pride Park. However, the three points for Wayne Rooney’s men would only serve to paper the cracks that had been plaguing the club in recent times. Financially-ailing Derby are set to enter administration, having appointed administrators on Friday in a last-ditch attempt to keep themselves alive and floating.
Having challenged for promotion to the Premier League as recently as the 2018/19 season, Derby has been put up on sale since June of 2019, however the Rams have yet to find themselves a suitable buyer.
The ongoing COVID-19 pandemic serves to devastate Derby’s finances even further, with the pandemic costing Derby £20m in lost revenue.
Derby owner Mel Morris had negotiated with two potential buyers this year, however both deals fell through. A takeover bid from Abu Dhabi-backed Derventio Holdings was called-off on March with Morris having lost patience with the Emiratis while in May another takeover bid from Spanish businessman Erik Alonso ended in failure.
Despite negotiations with a number of “credible parties,” Derby were unable to find a potential buyer for the short-term, leaving them no option but to enter administration.
“Because the COVID-19 pandemic has had a severe impact on the revenues and profits of all of its businesses, the Club has been unable to service its day-to-day financial obligations,” said an official statement in Derby’s website, “Unlike other sectors, football has been able to only marginally reduce its cost base with the majority of outgoings being associated with playing staff who obviously could not be furloughed.”
Should Derby enter administration, they will have 12 points deducted off them, effectively condemning them to minus points and last place in the league.
Adding more to Derby’s woes, they could potentially face an additional deduction of nine points due to violations in the English Football League (EFL)’s accounting regulations. The Rams’ accounting records for 2016, 2017, and 2018 are being investigated for said violations and Derby were already fined £100,000 at the start of the season for this.
The Rams were also slapped with a transfer embargo due to their ailing finances, forcing Rooney to sign free agents with strict conditions on salaries.
Should the EFL decided to go forward with their case against Derby, the Rams could potentially have 21 points deducted from them, leaving them on -11 points – quite a sizable challenge for Derby’s quest for survival. But should Derby only receive points deductions for their administration, they will be left with -2 points to their name, which on paper is much more manageable.