Cash-strapped Sheffield Wednesday rescued by bank

Debt-ridden English League One side Sheffield Wednesday have escaped going into administration after a bank bail out.

The Co-operative Bank came to the rescue of the embattled club in the High Court on Wednesday by settling the football club’s debts with the taxman.

Hilary Stonefrost, representing the bank, said it was prepared to pay the 703,000 pound debt if HM Revenue and Customs withdrew its winding-up petitions against Sheffield Wednesday Football Club and Sheffield Wednesday PLC.

Registrar Christine Derrett approved the settlement after hearing HMRC would dismiss the petitions.

The club was given 28 days last month to pay up after High Court registrar Peter Nicholls was told they had already made a “substantial payment”.

Hugo Groves, representing Wednesday, had asked for the adjournment of the winding-up petitions after saying money from the sale of players had been used to reduce the outstanding PAYE balance.

“There are also very serious and advanced negotiations for the sale of the club,” he said.

The Yorkshire outfit, who dropped down to the third tier league after demotion from the Championship last season, have struggled with financial problems since being relegated from the Premier League 10 years ago.

The Owls’ instability during the past decade has also been increased by several failed takeover bids.

Former chairman Lee Strafford quit at the end of last season amid speculation of boardroom unrest and former Wednesday manager Howard Wilkinson was installed as interim chairman.

They have made an encouraging start to their bid to get back into the Championship, with three wins, one draw and one defeat leaving them top of the League One standings after the first five matches.