Featured image of post Olympique Lyonnais faced with demotion and bankruptcy

Olympique Lyonnais faced with demotion and bankruptcy

Olympique Lyonnais is at a critical moment, faced with a potential administrative demotion in Ligue 2 and a possible bankruptcy. The club is heard by the appeal commission of the DNCG, the French football federation, in the hope of avoiding this disastrous outcome. This situation follows a temporary demotion, conditional on obtaining financial guarantees of approximately EUR 200 million. A rescue operation is under way, led by the new President Michele Kang and its Managing Director Michael Gerlinger, aimed at raising these funds through internal reorientations and convincing the ARES fund to invest the remaining 100 million.

Even in case of retention in League 1, the financial consequences for OL will be considerable. The club will have to assume a period of severe austerity, including a drastic reduction in the wage bill, the sale of high-market players, recruitment bans and a challenge to sports ambitions. The presence of Chris Mallon, a business recovery specialist and representative of ARES, underscores the importance of this situation. If the DNCG confirms the demotion, the future of the club becomes extremely dark, with a colossal debt of 541 million euros and a weakened economic model.

According to Bernard Lions, journalist and consultant, the DNCG may have reasons not to sanction OL, as a demotion would result in a loss of value and resources for the club. Moreover, such a decision would be surprising given the importance of OL in the French football landscape, recalling the previous cases of Bordeaux and Saint-ร‰tienne. The DNCG was criticized for having asked the club to settle for a forecast and then to demand EUR 200 million. The decision of the DNCG, expected by the end of the week, will have a significant impact not only on OL, but also on the whole of French football. Meanwhile, the club continues its preparations for the season, while preparing for the worst.