Arsenal take short-term $163 million loan from UK government to overcome COVID-19 impact

Premier League giants Arsenal have been heavily hit due to the coronavirus pandemic. It has led the London club to take a short-term loan. On Thursday, the Premier League announced that Arsenal have taken a loan from the British Government worth £120 million which roughly translates to 133 million euros or $163 million.

COVID-19 UK troublesome for Arsenal finances

Last year, the Gunners grabbed the limelight after they shared their plans on firing over 50 people from their staff due to the financial hit they took amid the coronavirus pandemic. With matches being played behind closed doors, many clubs are now without match day revenue. Ticket sales have been taken away from many clubs due to the spread of Covid-19 as teams are facing financial implications of the same. The north London side currently has a majority of its players agreeing to a pay cut of around 12.5 per cent in an attempt to keep some cash flow available at hand which will help the non-playing Arsenal staff to continue with their jobs.

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Arsenal government loan

On Thursday, the Premier League confirmed that the London side is a part of a scheme of the Bank of England. The scheme was made available by the government for organizations in need.  A loan from the national central bank will help Arsenal have some money for its ongoing operations that will help their revenue in current times where closed-door matches at the Emirates Stadium and a country-wide lockdown has hampered their money flow.

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Arsenal government loan: Club releases statement 

"As we continue to work through the implications of the global pandemic on our finances, we can confirm today that the club has met the criteria set by the Bank of England for the Covid Corporate Financing Facility (CCFF).

As a result, we are taking a short-term £120 million loan through this facility to partially assist in managing the impact of the revenue losses attributable to the pandemic. This is a similar approach to that taken by a wide variety of major organizations across many industries including sport and is repayable in May 2021.

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"The CCFF is designed to provide short-term finance at commercial rates during the pandemic to companies that have strong investment ratings and which make significant contributions to the British economy."

The club statement also revealed how Stan Kroenke’s loan was in addition to the extra financial support the club was receiving from its owner. Arsenal’s statement added, "The CCFF is in addition to the loan provided by our owners Kroenke, Sports & Entertainment that enabled us to refinance the debt on Emirates Stadium in August last year."

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Arsenal finances: Club blasted for poor financial planning 

Currently, slotted 11th in the Premier League standings, the North London outfit have come under the microscope of the public following poor financial planning and decisions. Fans and football followers have criticized the Gunners for spending money on transfer fees and wages across the summer transfer window. Despite failing to have money for paying over 55 staff members, Arsenal spent over $58 million while signing Thomas Partey along with handing out contracts to Willian and club captain Pierre-Emerick Aubameyang.