On Wednesday the Sun carried a small story that was probably missed by most football fans. The unassuming piece explained that West Ham had cleared its existing loan with the mysterious Vibrac Corporation and then immediately took out a new loan which they claimed could be as much as £70 million.
In March this year, Nick Harris from the Daily Mail wrote a story how West Ham had reached an agreement with this offshore lending company in the British Virgin Islands to borrow all £60million of our current season’s Premier League television money in advance.Nick claimed at the time that the revelation that West Ham set up this facility in September last year underlined why West Ham’s owners were at the forefront of campaigners within the League’s 20 clubs to bring in Financial Fair Play spending restrictions on wages this season.
Stories about the Vibrac Corporation are nothing new. Everton borrowed £13 million back in 2011 at a rate of 10% interest and have renewed that facility every year since.
A copy of the Everton mortgage documentation for that transaction filed with companies house can be found here
It is not known who owns the Vibrac corporation but they are based in the same building as BCR Sports, the company through which Robert Earl controls his stake in Everton FC.
In April 2012, a facility was also provided to Southampton by the Vibrac Corporation. Saints fans called for transparency over a mysterious financial document lodged by the club at Companies House at the time.
In April this year, a similar facility was also provided to Fulham to enable the club to borrow against future guaranteed income. However it is claimed this facility was settled early when Shahid Khan purchased Fulham last month.In the Fulham transaction they authorised the Premier League to pay £16million into Vibrac’s account with Barclays. Fulham put up Craven Cottage itself as security for the loan. In the draft mortgage document submitted to Companies House, an accountant named Robert Heppel is named as a witness to Vibrac’s side of the agreement.
So if the Daily Mail & Sun stories about West Ham’s dealings with Vibrac are taken at face value we could have borrowed up to £130 million as ‘pay day loans’ from Vibrac Corporation over 2 years and we could be paying as much as £13 million in interest if the 10% fee from Everton 2011 loan is anything to go by.
If the interest paid by West Ham is anything close to £13 million I see many questions being asked of our board of directors .
All should be made clear soon as WH Holding Ltd will need to submit their financial accounts year ending 31st May 2013. The first loan and any interest paid will need to be declared in those accounts.
Last year’s accounts weren’t published on the companies house website until 28th Feb this year so we have some time to wait before we know the true extent and scale of our mysterious dealing with Vibrac Corporation.
Note from Iain: I’d like to welcome Sean to the site. He will be posting regular articles on the finances of West Ham.