Depor file for bankruptcy

Deportivo have, as expected, taken the necessary first steps to enter into administration through the courts today.

The Galician club are reported to have a total debt of €90m owed to various creditors.

The tax office embargoed €14m of the club’s intended €18m worth of assets earlier this season and gave President Augusto Cesar Lendoiro [pictured] four months to try and renegotiate debts with creditors or file for bankruptcy.

Lendoiro has proven unsuccessful, so the club have now taken steps to enter into administration by applying through the court to certify that it cannot meet the payments on money owed.

The process will see the club automatically have its debt reduced, with a number of creditors now likely to lose out on at least a percentage of their money owed and the tax office unlikely to see its debts settled either. The tax office’s embargo will also immediately cease.

The club’s board will be able to continue to manage the club, but they will now be answerable to between one and three administrators, who will have final say on any activity or points of management, including transfer work.

Depor do face the slight chance of being liquidated, if the judge hearing their appeal to enter into administration does not see them as viable enough to pay back any of the money owed, or if Depor present inaccurate accounts.

Lendoiro has only reported the club’s debts as standing at €34m, whilst more reports believe it to be closer to €90m. Full details of the true state of the club’s accounts will be made public as part of the process.

Tags Debt Deportivo Hacienda Lendoiro