West Brom lent owner Lai £5m amid pandemic
ALOAN worth almost £5 million was taken out of West Bromwich Albion by its majority shareholder and chairman Guochuan Lai, it has been revealed.
A total of £4.95 million was transferred in March 2021 to Wisdom Smart Corporation, a company related to Mr Lai, with a fixed interest of £50,000.
This was supposed to have been paid back in September last year but a new due date has been agreed of December 31, 2022.
The news comes as the Championship side released its financial statements for the 11 months to June 30, 2021 ahead of the official accounts being published on Companies House.
The financial period covers West Brom’s last season in the Premier League before they were relegated to the Championship, a season in which the club had to play all but one of its 19 home league matches with no fans because of the Covid pandemic. This resulted in a total of £13.2 million being lost due to the pandemic, compared with £2.8 million in 2019/20 when only the latter part of the season was impacted by coronavirus restrictions.
Turnover increased from £53.7 million in the 13 months to July 31, 2020 to £106.9 million, owing to Premier League distributions and sponsorship income.
The club also managed to record a small profit of £100,000.
Staff costs increased from £66.9 million to £76.9 million, with the increase predominantly driven by the contractual salary increase for players and staff following promotion to the Premier League in the 2019/20 season.
Mr Lai said: “The club’s annual accounts for the 2020/21 season detail a loan to Wisdom Smart Corporation, a related party to me.
“Regrettably, the pandemic saw my international businesses suffer, particularly those in the hospitality and entertainment sector, which experienced an almost complete closure for long periods, and in March 2021 I received a loan from the football club.
“The upturn in the global economy has brought with it greater positivity and I can confirm I will repay the loan in full, with interest, by the end of the current calendar year and the funds will be available to the club during the January 2023 transfer window.
“I am looking forward to an exciting season for Albion and again thank fans for their dedicated support of the football club.
“I will return to The Hawthorns to watch a game at the earliest opportunity and I am excited to see the progress the team has made this summer. I believe we have made positive progress in recent months and the appointment of Ron Gourlay as chief executive in February has already strengthened the football club.
“I remain committed to returning the football club to the Premier League and I am confident we will be able to compete for promotion from the Championship this coming season.”