Investor seen as Vitesse's last lifeline pulls out; Football club closer to bankruptcy
Dutch football club Vitesse moved closer to bankruptcy on Monday with the announcement that their likely financial savior, investor Guus Franke, has pulled out of talks to rescue the club, sources told the Telegraaf. The club has until the end of Monday to submit its supporting material to the KNVB to appeal the Dutch football association's decision to withdraw Vitesse's professional license.
Vitesse said it had found an ideal partner in Franke, the founder of international private equity firm Axiom Partners. Franke had expressed interest in buying the club, as he grew up about 20 kilometers from there in Ewijk, making him a lifelong fan. It is not clear if Vitesse has a backup plan to maintain its professional license.
Just last week, the Arnhem club's top executive said the team had enough cash on hand to continue operations for about ten days. That means the club might not be able to pay salaries and bills by Friday or Saturday, said CEO Edwin Reijntjes during a press conference this past Wednesday.
The club has been in financial trouble for years, but the situation worsened more recently. The club's ownership over the past decade has been tied to Russian oligarchs, with rumors that control was at the discretion of Roman Abramovich despite the controversial matter that he was also the owner of London Premier League football club at the time. Further, the Arnhem club's Russian shareholders were placed on sanctions lists after Russia intensified its war in Ukraine.
That made it harder for Vitesse to legally have a bank account, and to obtain licensed accountancy service in the Netherlands. Making matters worse, earlier this year the KNVB accused the club of deliberately or accidentally providing inaccurate and incomplete investigations in Russia sanctions investigations.
Because of that, the KNVB docked 18 points from Vitesse's professional team. That led to their relegation from the top flight Eredivisie. Other attempts to rescue the club also failed.
The club is believed to have debt outstanding with its former Russian owner, Valeriy Oyf, and with The Common Group, an American investment group whose attempt to take control of the club was blocked by the KNVB. Franke was believed to have already made an agreement with Coley Parry, who represents The Common Group, about more than 14 million euros owed to him. Reijntjes said time was the biggest obstacle to a deal last week. "But I don't know how quickly we can close a deal. Guus Franke has assured me several times that he has confidence in it."
He later said, "Without Franke I wouldn't be here now, because then I would have said, 'Close the place, it's over.'"
