from the Guardian
Swindon Town, the League One football club, faces a winding-up order from the quoted property company St Modwen tomorrow over the non-repayment of a £2.45m loan dating back to 2005.
Swindon is controlled by a consortium whose shareholders include the City grandee Sir Martyn Arbib and the serial entrepreneur Andrew Fitton, the chairman of the club who has businesses in engineering and technology. Fitton's consortium – which also includes Jeremy Wray, brother of one of the founders of online gaming group Betfair – took over Swindon Town in 2007. The sellers included the Wills family, who made their fortune from the tobacco industry.
St Modwen originally become involved when the club was considering moving from its County ground to a purpose-built stadium.
The plan would have seen the original site redeveloped for housing and leisure use. In 2005, as part of this partnership, St Modwen lent the club £1.45m, which went towards paying off a VAT bill. Swindon Town had already gone into administration twice before, and was facing the prospect of going under again unless it settled the debt to the tax authorities.
When Fitton's consortium took over, St Modwen asked for its loan to be repaid, since the proposed move from the County ground – which is owned by the local council and leased to the club – had fallen through and the property developer had no further interest in the matter.
The two sides agreed a two-year grace period for the outstanding amount to be repaid, but that deadline ran out in August with no settlement forthcoming.
Three weeks ago St Modwen issued a statutory demand for repayment. Since then it has heard nothing to indicate the debt will be repaid, and believes it has no alternative now but to go to court. It is claiming the original £1.45m loan plus £1m in interest.If Swindon's directors do not pay up, and St Modwen is successful in its winding up order, the club will go out of business and its assets will be sold for the benefit of creditors.
It will join a growing number of football clubs which have found themselves in severe financial difficulties with the likes of Stockport County already in administration, and even Premier League club Portsmouth struggling to pay players' wages earlier this season.
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