Schalke reach agreement over 25.5 million euros
29.10.2009
FC Schalke 04 today (29 Oct) concluded an agreement worth 25.5 million euros that represents a key part of the restructuring of the club's finances. In addition to the club and the stadium holding company, the parties to the contract are the Gelsenkirchen-based company GEW and a major German bank.
The agreement consists of two main parts. First, the club is to sell interests in the VELTINS Arena to its contracting partners for a price approaching 15 million euros. After ten years FC Schalke 04 will have the opportunity to buy these shares back. In addition, the contracting partners are to grant the Arena company loans worth a total of 10.5 million euros. This will allow the Arena company to pay loans in the same amount back to the club. The agreement has been signed by all the managing boards and general managers and merely needs to be rubber-stamped by the respective supervisory boards.
"This means that funding is in place for the whole of the current 2009/10 season. A further sale of rights, shares or players will not be necessary from a business point of view", said Peter Peters, board member with responsibility for finance. "FC Schalke 04 will also meet all the obligations arising from the licence agreement with the German Football League." Peters added: "Our partners are investing in a valuable property, the VELTINS Arena, and thus supporting the ongoing urban and infrastructural development of the Arena Park."
"We aim to reorganise the club in three areas, i.e. in sporting, structural and financial terms", said Schalke supervisory board chairman Clemens Tönnies. "The new agreement is an important step towards putting the club's financial structures back on a solid footing in the long term."
In summary, in its financial statement for the 2008 calendar year FC Schalke 04 reported total liabilities of 137 million euros as at 31.12.2008. At the same time the Arena company had liabilities totalling 113 million euros. Following the sale of the interests in the Arena, the total liabilities of the "FC Schalke 04 Group" will in future be reduced by the liabilities of the Arena company, as the club's holding will fall below 50%. The Arena company will thus no longer appear in Schalke's consolidated balance sheet. Peters said: "Irrespective of this the club will, of course, continue to make its lease payments to the Arena company, which will continue to be used to service the Arena's liabilities."
