Financial troubles

Cardiff and Southend handed winding-up deadlines

March 10, 2010

Cardiff and Southend have both been given stays of execution by the High Court, as they fight winding-up orders from Her Majesty's Revenue and Customs that threaten their existence.

Cardiff have been given until May 5 to settle a tax debt to HMRC in order to avoid following Chester into liquidation. The Bluebirds appeared at a High Court hearing today with HRMC seeking to have the club wound up over unpaid bills.

Matthew Smith, representing HMRC, told Mrs Registrar Derrett that the club owed around £1.9 million and were "robbing Peter to pay Paul'' in order to stay afloat.

Elaine Palser, representing Cardiff, said a "third party'' investor would be providing the club with £6million in funds and the tax debts would be paid.

She said the company was not insolvent and had substantial assets including £30 million worth of players and the problems had been caused by "temporary cash flow difficulties''. Mrs Registrar Derrett granted the club 56 days to make a full and final settlement with HMRC.

But Southend were not as lucky as the Bluebirds and have been given just 35 more days to pay a tax bill of almost £200,000.

The Coca-Cola League One strugglers were in the High Court this morning to face a winding-up order from HM Revenue and Customs over the disputed debt. Chairman Ron Martin managed to win an adjournment and now has until April 14 to settle up.

The troubled Shrimpers have been forced to use a loan from the PFA to help pay the players' wages for January, meaning they are now under a transfer embargo. They slipped into the relegation zone following Saturday's 3-0 defeat by Hartlepool.