Royal AM Sale: Prospective Buyers Face Club’s Debt Obligations
The ongoing negotiations regarding the sale of Royal AM present a significant financial hurdle, as any prospective buyer will be obligated to assume the club’s current debt.
Reports indicate that Royal AM is grappling with considerable financial difficulties, necessitating that new owners address outstanding debts to gain control of the club. This situation may complicate discussions, as interested parties must evaluate the financial feasibility of the acquisition in light of the associated liabilities.
Notwithstanding the debt, Royal AM continues to be an appealing opportunity due to its status in the Premier Soccer League (PSL) and its potential for future development. Under the ownership of Shauwn “MaMkhize” Mkhize, the club has garnered attention in South African football, although financial issues have overshadowed its recent achievements.
Despite the imminent risk of liquidation, there remains interest from potential buyers, with estimates suggesting a sale price between R40 million and R45 million. However, any new ownership will not only need to purchase the club but also take on the responsibility of addressing its substantial debts.
Debt Challenges and Player Salary Issues
A significant financial obligation for Royal AM is the R15 million owed to Serbian striker Samir Nurkovic. The club’s inability to resolve this debt has resulted in FIFA imposing a transfer ban, hindering their ability to sign new players. Furthermore, there are additional contractual commitments and outstanding payments to former players, coaches, and agents, which could total millions more.
A source familiar with the situation remarked:
“Any buyer must acquire the club at the price set by SARS, but the debt will remain with the new owners. It is essential to fulfill obligations to Nurkovic, Nascimento, and all contracts that have not been completely honored. This encompasses signing-on fees, agent fees, and all related expenses.”
The status of Royal AM within the Premier Soccer League (PSL) is jeopardized due to its financial difficulties. Nevertheless, should the club be sold and the new proprietors succeed in rectifying its financial situation, it may remain in contention within the league. The designated curator is anticipated to manage this transition, guaranteeing that the club completes the ongoing season.
