The Premier League have decided to not give the latest installment of the Sky money to Portsmouth. A figure of £7m has been generally quoted.
Instead the Premier League is giving the money directly to the clubs who are owed transfer fee money by Portsmouth. The Premier League are also keeping in place the transfer embargo they imposed on Portsmouth last year.
The BBC are reporting the deals involved are for Glen Johnson from Chelsea in August 2007, and for Younes Kaboul from Tottenham, Sulley Muntari, now at Inter Milan, from Udinese, John Utaka from Rennes and Nadir Belhadj and Aruna Dindane from Lens.
Even after the Premier League have paid sides there will still be £3m owed to other teams.
The most amazing thing in all of this is that the Premier League feel they have to do it. The must believe that if they gave the money to Portsmouth then Portsmouth would not use it to pay the other teams and would instead use it for something they view as less important. The most obvious other uses woudl be paying players, and paying off the tax man.
On Radio 5 this morning Peter Storrie who is CEO of Portsmouth, and was paid £1.2m by Portsmouth in 2008 to manage their business, was interviewed. He was asked about the embargo, and the payments and the general situation.
He said that Portsmouth were now in a position where they had no outstanding bank loans, a posiotion he claimed no other Premiership side were in. (In the last club accounts published in July 2008 the club had bank loans of £44m, on which they were then paying interest of roughly £126,000 per week. Under the terms of these loans they had to be paid off in two chunks, by March 2009, and then September 2009. The club also had other loans that totaled £13.7m that were due for payment.)
Storrie seemed put out that the League had maintained the embargo when the club has been so helpful in telling them who they owed money to. He also stated that he had never met the current owner of the club, who he described as a "businessman" rather than a fan.
With no Sky money to pay the players, the only hope of fresh cash coming in to the club is from the owner and from any money that comes in from an FA Cup run.
For more detail on the Portsmouth finances got to the Portsmouth site
