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Potential Royal AM Buyers Have To Carry Club Debt

Potential Royal AM Buyers Have To Carry Club Debt

The potential new owners of Royal AM will have a lot on their plate and arguably the biggest factor will be the debt that needs to be cleared.

Indications are that the club is up for sale before the PSL consideration of liquidation, and it's believed that there are buyers interested in acquiring the club, believed to be in the range of R40 to R45 million.

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The club is currently facing possible expulsion after the South African Revenue Services (SARS) appointed a curator to run the team following the revelation that club owner Shauwn Mkhize owes R40 million in taxes. But with the possibility of the club being sold by the curator in the near future, they could be allowed to finish the season as normal and fight for their place in the top flight.

The big challenge at the moment is that the club is carrying a large amount of debt, which the new owners would have to settle themselves.

One of the biggest debts is R15 million owed to striker Samir Nurkovic, a saga that has seen the club being banned from signing players by FIFA. Whoever steps in to take charge of the club will have to fork out millions to pay and handle other costs the club may have incurred over time.

The Siya crew spoke to an individual who had previously bought a status to find out what debt new owners often incur. 

"Whoever buys it, must buy it for whatever SARS is selling it for, but the debt will remain with the new owners. You'd need to honour what you owe Nurkovic, what you owe Nascimento and all the contracts that were not fulfilled 100 percent. This can include signing on fees. You must pay everything. Even things like agent fees come into play," the source said.

"People underestimate the cost of owning a club. The costs are way too high. You need to understand that you are going to pay everything. Whoever buys must do proper consultation and understand what they are buying."

It's unclear at this stage how long it would take for a sale to go through, but the PSL would certainly want to have it done as soon as possible to ensure the season does not drag on unnecessarily with this whole situation. The club last played an official game in December 2024 and would need to catch up on fixtures, which will be a big challenge for the new owners as they would want to avoid relegation. 

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Should the club be purchased this season, they would have to keep the name. A name change, whether relegated or not, would only be granted by the PSL next season.

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