West Brom’s updated financial situation amid £20 million loan - could new owners come forward?

On the pitch, West Bromwich Albion have enjoyed relative success following their disappointing start to the season under former boss Steve Bruce. Carlos Corberan’s reign has seen Albion shoot into the play-off race after picking them up from the bottom of the league.

However, off the field, the Baggies remain in a precarious position with regard to finances and their current ownership, with loans and investment poising question marks over the club’s financial future. These worries will only intensify if they do not get promoted to the Premier League at the end of this season.

With so much up in the air at the moment, here is the current state of play at The Hawthorns...

MSD Holdings Loan

It was announced via a club statement as 2022 drew to a close, that West Brom would take out a £20 million four-year loan from company MSD Holdings UK Limited.

This came with a hint of alarm for supporters, as the statement read that it would be used to cover ‘general business operations’ at the club. The loan was also taken out against ‘all Group assets’ which would include essential properties including the training ground and stadium.

But since then, speaking to The Athletic, Chief Executive Ron Gourlay has insisted that borrowing the money was the decision of majority shareholder Guochuan Lai. ”It was his (choice), he is the major shareholder,” Gourlay said. “It’s his money, he’s the guy who spent £200 million on the club. I’ve got to run the day-to-day as chief executive of the football club, and I can only work with the toolbag I have.”

Carlos Corberan’s position

The current Albion boss has propelled the Baggies up the league table since taking over from Bruce towards the end of October. But with sackings aplenty in the Premier League of late, Corberan has found himself amidst plenty of speculation regarding his future, with interest heightening from top-flight clubs.

But Ron Gourlay told Express and Star that he remains impressed with the Spaniard. “He is a bit like a young [Jose] Mourinho when he first came into Chelsea,” Gourlay said. “The thing I see here is the thing I saw with Jose when he first came in is that ‘If you believe in me and do what I ask, you will come to the club and win’. It’s that belief and trust,” Gourlay continued.

Outstanding Lai loans

The MSD Holdings loan brought added uproar from Albion supporters amongst other borrows under the club’s name. Controlling shareholder Lai took out a £4.95 million loan with interest against the club on behalf of his related party, Wisdom Smart Corporation, which was due to be repaid at the end of 2022.

However, as confirmed by a club statement on New Year’s Eve, that particular loan was not paid back on time, nor has it been repaid in the early new year. In addition to that, there is an independent investigation into the £3.7 million loan taken out by former chairman Jeremy Peace in 2014. The outstanding balance was transferred to Lai when he took over Peace’s majority stake in the club. This, however, remains unpaid.

Another club statement said that an investigation is set to be conducted by a King’s Counsel barrister and completed within the next six months. According to Express and Star, Lai also owes a further £2 million to Warmfront Holdings Limited, who will own 2.35 per cent of the businessman’s shares in the club should he fail to repay.

Takeover suggestions

According to The Telegraph, there was interest in the club in late 2020 from an American consortium. At the time, Lai was seemingly willing to sell the club with hopes of recouping the majority of the £200million he paid for the club back in 2016.

But there have since been no offers tabled since Gourlay took over as Chief Executive back in February, as he told The Athletic. “To pay around £200 million was probably a fair bit over the market price even then,” Gourlay said.

“The market sets the price now, so that figure is not on the table, not even close. He understands that, he’s a businessman. I have yet to have any group or person come to me in the year I’ve been here asking me to buy the club.”