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Monday, February 11, 2008

QPR's Financial Situation Under its New Owners: Bernie Ecclestone's Perspective

The Times/Alex Wade - February 11, 2008
QPR fans give thanks a billion times over
Throw money at Loftus Road? That’s rich, says Bernie Ecclestone (worth £2.24bn)

Bernie Ecclestone does not mince his words. “One thing’s for sure,” he says. “If we owe anything, we pay it back.”

Ecclestone, one of the wealthiest men in sport with an estimated fortune of £2.24 billion, was not referring to his family policy on monthly credit card repayments. The Formula One impresario was alluding to the debts he inherited when, along with Flavio Briatore, another of motor racing’s more colourful characters, he took over Queens Park Rangers.

Their arrival was greeted with rapture by long-suffering fans who in recent years have seen the club teeter from one calamity to another. The subsequent arrival of an even wealthier investor – Lakshmi Mittal, reputedly the world’s fifth-richest man – consolidated a new nickname for the club. With Mittal having bought 20 per cent of Briatore’s shareholding, fans were chanting “1-0 to the billionaires” when their team opened the scoring in a Coca-Cola Championship match against Barnsley last month.

But for all the excitement – even Naomi Campbell, the supermodel, has been seen in the directors’ box – QPR’s recent history is fraught. Since relegation from the top division in 1996, the club have gone into administration and been dogged by a succession of controversies. There have been off-field tragedies involving young players, the infamous “Great Brawl of China” – when a match against the China Olympic team descended into violence – and a remarkable court case in 2006 when seven men were acquitted of charges of conspiracy to blackmail, false imprisonment and handgun possession after Gianni Pala-dini, the chairman, alleged that a gun had been held to his head before a home match against Sheffield United.

But if high noon at Loftus Road seemed, at times, in danger of becoming a weekly event, QPR emerged from administration in 2002 thanks to a £10 million loan from the ABC Corporation. The benevolence of the Panama-registered company came at a price – a cool £1 million in annual interest – and, until the Formula One duo turned up, seemed set to dog any attempt to escape the lower reaches of the second tier.

Yet even as Ecclestone and Co took the reins there were murmurs of disquiet. One newspaper made much of the fact that, some two months into the new regime, the ABC loan had yet to be discharged. Ecclestone is happy to set the record straight.

“We will pay the debt when we can – at the end of June this year,” he says. “That’s when the loan matures, so that’s when we can pay it back.” Likewise, debts to Antonio Caliendo, a former director and major shareholder, reportedly owed £2 million after the takeover. “We’re finalising the balance sheet with Mr Caliendo in order that we can clarify what is owed to him,” Ecclestone says. “When this is completed he will be paid immediately.”

The settling of such obligations will be good news for QPR fans; so, too, Ecclestone’s sense of the club and their future, despite what appeared to be some rather heretical confessions. He cheerfully admits that he was “never all that interested in the domestic game” and that, if anything, QPR’s sworn rivals, Chelsea, were his team, thanks to watching matches at Stamford Bridge with Roman Abramovich.

Moreover, Ecclestone says that QPR “wasn’t on my radar” and that he initially thought that they were not even a football team. “Flavio had been telling me he was looking at buying a restaurant, so when he called me one day to talk about QPR, that’s what I thought he was talking about,” Ecclestone says. Since getting involved, however, he has been delighted by the fans’ response. “They’ve been great,” he says. “They’re incredibly loyal and passionate, a really good bunch of supporters.”

The new owners see this season as one for consolidation, with a push for promotion in 2009. The idea of moving to a new stadium is not on the agenda, although Ecclestone agrees that Loftus Road, with a capacity of fewer than 19,000, is on the small side. “But we can’t move the place so we’re looking at ways to upgrade and refurbish it,” he says. “We need to work out how we can get the maximum use out of the ground.” Money has been spent, with Akos Buzsaky, the Hungary midfield player, Matthew Connolly, the defender signed from Arsenal, Hogan Ephraim, the former West Ham United winger, and Rowan Vine, the striker recruited from Birmingham City, among several players to commit their futures to the club. Luigi De Canio, the Italian manager, has overseen a steady climb towards mid-table safety.

Ecclestone is proud to have “saved the club from going out of business” but adds cautionary words for those who think a bottomless pit of money is available. “QPR isn’t a wealthy club. It’s a club that’s owned by some wealthy people,” he says. “No one is going to be lashing out lots of money. Things need to be done correctly and that’s what we’re going to do.”

After the club’s helter-skelter existence of recent years, a strong dose of pragmatism mixed with a healthy bank balance may be what the doctor ordered. The Times

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