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German football: 13 clubs at risk of going bust due to Coronavirus

Writer's picture: Andrew ZarbAndrew Zarb

Will the Covid-19 pandemic lead to a severe crash in football?

The Coronavirus pandemic has been a huge hit to society as a whole, and football has been no exception with matches being postponed and leagues being suspended as a result of Covid-19, except in Belarus where the league is inexplicably going on as normal! As a result of this outbreak, clubs are currently receiving little to no revenue given that no games are taking place whilst still incurring fixed costs such as paying player wages. In a bid to cut costs, some clubs have agreed to reduce player wages - a subject which is proving extremely controversial amongst Premier League clubs. In turn, given that no football matches are taking place, broadcasting companies are withholding payments to the Leagues which in turn go to clubs who tend to rely quite heavily on this money in order to keep operating.

If matches in the Bundesliga and 2.Bundesliga do not resume by the beginning of May, broadcasters will not issue their final payment to the league for the season (as they would have no games to show) which would later be distributed to clubs. As a result, according to German magazine Kicker, it is understood that 7 clubs in the 2.Bundesliga and one Bundesliga club would have to file for bankruptcy at the end of May. If the situation extends further, then it is understood that 3 more Bundesliga clubs, coupled with 2 more from the 2.Bundesliga (Germany's second division) would then file for bankruptcy by the end of June.

Therefore, in total, it is believed that 13 out of 36 clubs (more than a third) from Germany's top two divisions are at risk of soon going bust, highlighting the reason why clubs are desperate for games to resume as soon as possible, even if it is behind closed doors. Despite the fact that it is believed that 13 clubs are potentially at risk of folding, no names of clubs were specifically mentioned, however, it is clear that this global pandemic is causing huge problems in football. Furthermore, it is believed (although things are of course subject to change given the extreme uncertainty as a result of the current situation) that the DFL, the authority in charge of the Bundesliga and 2.Bundesliga, are planning to resume games either in the first or second weekend of May, which would be behind closed doors in order to minimise the risk of spreading the Coronavirus. This is not to say that games behind closed doors will not mean losses in revenue for clubs, though a resumption of the league season in the beginning of May would at least help mitigate (if not totally avoid) the risk of clubs going bust.

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