The rush, the panic, the mess. Why Salford are in a serious cash crisis

SALFORD’S financial mess has been caused by having to do a takeover deal the wrong way around in order to save the club.

And money is dripping through, in stages because of foreign bank rules and the fact the new owners had to move so quickly.

But the current chaos may result in them not fielding a bare 17-man squad for the Challenge Cup tie with Bradford as they have not paid off debts.

The latest blow being the departure star half-back Marc Sneyd, who has joined Warrington for what is believed to be a high five-figure fee.

Stars received their February salaries a week late, through the personal bank account of consortium member Saia Kailahi, with a £130,000 advance of central distribution from Rugby League Commercial made in case that did not come.

Now a series of transfers have at least landed in the Red Devils’ bank account over the course of the last few days, with more to come, covering the wages of off-field staff, including boss Paul Rowley.

But SunSport can reveal why the buyout by Swiss moneyman Dario Berta, Kailahi and Curtis Brown has led to calamity.

Put simply, they were meant to buy the Salford Community Stadium and land around it – their main concern – first but the club’s shocking financial state forced them to rush before they were properly ready.

As talk of administration looms, relegation at the end of the year under IMG’s grading scheme is a real possibility, it is hoped enough money can be transferred from Kailahi’s Australian base to prevent a repeat of the wage farce, then a larger amount can be funnelled in.

The group intended to transfer £1.9 million in one lump sum but banks on either side of the world prevented that happening.

It is thought money from Australia can only be made in $100,000 AUD sums – just under £49,000 – at a time, leading to last week’s scramble to get the players paid and the bare 17-man squad on the pitch in the Super League clash with Castleford.

Now as they face the Championship side tonight, the cloud still hangs over them, with a £1.2 million sustainability cap reimposed by the Rugby Football League still in place.

It is thought it was lifted for the home match against Leeds after proof of the original transfer was provided before the banks intervened, as they are paying into an account which is not yet in the name of the Salford RL Group firm they set up.

And changing the arrangements is likely to take a few weeks before larger sums can come in – with some creditors not allowing much time.

One source close to the deal told SunSport: “The plan of buying the stadium and redeveloping the area was the main piece of work.

“We planned to provide the club with a 20 per cent ownership of the stadium, which would have improved their balance sheet.

“However, the club’s financial position meant they had to buy it.

“Firstly, not all of the funds were in place because we planned to buy the stadium in April/May, and secondly, Salford Red Devils are in a really poor financial position, which alarmed investors, causing even more delays.

“The lead investors have returned to Australia to make the transactions. It will take a few weeks, but we are confident we will pay staff this month and next.”

Salford’s cash crisis can be traced back 15 years, when the deal to move to what was the new AJ Bell Stadium, then co-owned by Salford City Council and Peel, was done.

For their desperation to leave The Willows for a decent venue and stay in Super League saw them sign up to a deal where they received nothing from their own matches, not even a penny from the sale of a sausage roll.

After dodging bullets, somehow, and even making it to Super League’s Grand Final and the Challenge Cup final, it could be said it is a wonder they are still where they are.

Now the council has bought Peel out – it is hoped a deal for the stadium and land around it, which would see a 5,000-seater arena and a hotel placed on it – can be done, properly securing the club.

An advertising screen facing the neighbouring M60 motorway – ran in conjunction with local betting magnate Fred Done but which could generate Salford £400,000 in the first year, rising to £1 million – would also be erected.

And it is understood city mayor Paul Dennett – said to be fuming at how the former administration’s part in the original stadium terms – has met with the investors about doing a deal and the plans for the area.

In the meantime, however, Rowley could guide his scratch side to two wins from Wembley with a win.

He said: “Tired is one thing I’ve found myself but I gave myself a slap and my head a wobble – we’re privileged to be here and walk tall. We’ll all come through the other side and this will be a distant memory.”