November 18 – In a move that sent shockwaves through French football, Olympique Lyonnais, one of the country’s most prestigious clubs and domestic title winners seven times, have been banned from making any signings in the January transfer window and will be relegated from Ligue 1 at the end of the season if they are unable to address a financial crisis.
Currently fifth in France’s top flight, the club, majority owned by controversial American investor John Textor, received the punishment from the National Directorate of Management Control (DNCG), the financial watchdog of the French league.
Textor, who also partly owns Botafogo in Brazil, RVD Molenbeek in Belgium and Crystal Palace in England, is the majority stakeholder of Lyon through Eagle Football Group, a holding company listed in Paris.
Textor came out fighting on Friday by declaring: “I’m confident in our figures and the good news is that the DNCG is independent, they are very intelligent people, accountants, financiers who can look at the figures.”
“We’re going to generate several million dollars in cash over the next few months, and we’re in it for the long haul.”
In August L’Equipe reported that Lyon had put the majority of its squad on the transfer market to raise €75 million to balance its budget and meet financial sales targets.
Those claims were denied by Textor but the club, who have not been outside of France’s top tier since the 1980s, are reported to have racked up more than €500 million in debt.
The ruling handed down means the 2020 Champions League semi-finalists are going to need around €100 million in revenue to save their status. To do that they may well have to sell some of their prized assets, such as 21-year-old midfielder Rayan Cherki, in January.
Lyon’s situation echoes what happened to Bordeaux, another storied French club. The six-time domestic champions have virtually disappeared out of sight and are now languishing in the fourth tier of French football.
Bordeaux, hit by €118 million of debt, has closed its youth academy, women’s division and most administrative offices. It has filed for bankruptcy and renounced its status as a professional sports club.
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