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Football finance expert Stefan Borson has revealed why Tottenham fans should not be getting too excited about ENIC’s decision to inject £100m in equity into the club.
Last week, Spurs confirmed that their majority owners had injected £100m into the club, which came as encouraging news to Tottenham supporters.
Many saw that as proof that ENIC are prepared to put their money where their mouth is after Tottenham’s owners had repeatedly reiterated that they want to usher in a new era of on-pitch success.
On social media, Spurs fans are already dreaming of using that money for big-name signings, but things may not be so straightforward for the North London club.
Tottenham needed a cash injection just to pay their bills
We have already heard claims over the last week that the Lewis Family’s £100m cash injection is primarily to improve Tottenham’s balance sheet rather than to be used for transfers.
This has now been backed up by Stefan Borson, who asserted that Spurs need the money just to fund their wage bill and service their transfer debt.
When asked about the Lewis family’s decision to pump £100m into Tottenham, Borsen told Football Insider: “I think it’s pretty unexciting. I mean, they’re trying to spin it as being a sort of new key development, but Spurs’ owners have had to put equity in over the last few years just to pay the bills.
“Spurs, although they are one of the more successful clubs financially, they do have bills. They do have a big wage bill, not as big as it should be probably, but it’s still probably running at about £250m a year, so they do have substantial running costs. It’s not a hugely profitable business.
“They do have commitments on player signings because their transfer debts are significant and, therefore, the payments that are going to be due over the next few months are significant.”
How much of ENIC’s £100m will be spent on transfers?
Previously, journalist Ben Jacobs suggested that a portion of ENIC’s cash injection will be used for transfers, although that may not be the primary use of the £100m.
Borson has now predicted that only around a quarter of the new money pumped into the club may be intended to give the club more flexibility in the transfer market.
Speaking about how the funds would be used, he added: “They don’t have huge numbers of players that they’ve been selling over the last period, so of course they’re going to need cash just to pay the bills, and it may be as well that they want to have a little bit of flexibility for January as well.
“It could be maybe a quarter of that £100m just to give them a little bit of cash flow as we go into January. None of it’s a surprise, and it’s a very modest amount of money.”
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