The FY25 accounts already describe a club operating well outside its means even before any relegation shock is applied. Turnover collapsed from £268.2m to £226.1m on the back of the drop from 9th to 14th and the absence of UEL receipts. 

Total employment costs rose to £173.3m (wage:turnover 66.6%, up from 59.3%). Amortisation of player registrations hit £99.4m. Operating loss before exceptional items and player trading was £109.5m. Profit on player sales collapsed from £96.3m to £20.0m, removing the structural plug that has historically kept the P&L tolerable. Pre-tax loss: £108.8m.

The balance sheet is the most important diagnostic. Net liabilities widened from £108.4m to £216.6m. Intangible (player) NBV stands at £223.2m against gross cost of £481.0m , the squad has been inflated rapidly. Player-related creditors total £195.8m gross (£110.9m within one year, £84.9m beyond). The amount owed to parent (WH Holding) is £176.3m and is interest-free/repayable on demand, economically equity-like, but legally a creditor. 

The £40m Barclays overdraft was £16.3m drawn at year-end. Post-balance-sheet, the £124m R&MF five-year facility was added, with £89m drawn on signing , meaning the club has effectively monetised future broadcast/transfer cash-flows already. 

Operating lease commitments of £409.4m (almost entirely the London Stadium 99-year lease at circa £4-5m index-linked per year) sit off-balance-sheet under FRS 102 but matter for any going-concern stress.

The 2025-26 trading position is materially worse. Per Matchday Finance’s read of the accounts and tracked transfer activity, circa £200m of further player gross investment ran through the summer 2025 window (Fernandes from Southampton circa £44m, Hermansen, Magassa, Diouf, Castellanos in January, Pablo, Walker-Peters, Wilson on free, Todibo permanent at circa £36m), with a further circa £50m gross spend in January 2026. 

Approximately £200 million spent on players including Fernandes, Todibo, Castellanos, Pablo, Diouf, partially offset by around £130 million expected from sales. The club entered 2025-26 with £195m of player payables already accrued and added to it.

The key point: West Ham is not entering a hypothetical relegation from a position of resilience. It is entering it from a position that already required mitigating actions in the FY25 going-concern memo (Note 1b) even assuming Premier League survival.

Revenue impact of relegation, line by line

Take FY25 (£226.1m) as the cleanest reference baseline because it already strips out European income.

Broadcasting (£132.4m → circa £49m + EFL share). This is the cliff edge.

 The Premier League equal share in 2024-25 was £29.8m domestic + £59.2m international + £7.9m central commercial = £96.9m baseline, with merit (£1.6m × inverse position domestically + £1.04m × position internationally) and facility fees on top. Southampton finished 20th and still received £109.2m. Ipswich Town received £111.1m, while Leicester City received £116.9m. West Ham’s 14th-place broadcast take of £132.4m is roughly the equal share plus circa £23m in merit and circa £12m in facility fees.

In the Championship the revenue stack inverts.

 In 2024/25, the three clubs relegated the previous season – Burnley, Sheffield United, and Luton Town – each received approximately £49 million in year-one payments alone. The structure is 55% in the first year, 45% in year two and 20% in year three of the Premier League equal share. EFL Championship Sky deal pays a basic award of approximately £4-5m plus facility fees. Net Year 1 Championship broadcasting revenue: c.£53-55m vs £132.4m. Loss: circa £78-80m on the broadcast line alone. 

Match income (£38.6m → circa £28-32m). Gates of 62,432 are unlikely to drop materially given season ticket loyalty (the club explicitly references this in the strategic report), but the Championship has 23 home league games vs 19, partly offsetting the per-fixture ticket-yield reduction. Average ticket price will fall , concession volume rises and price tolerance falls in the second tier. A larger hit comes from cup fixtures and the absence of marquee Premier League visitors. Expect £6-10m of erosion.

Corporate hospitality and premium seating. This is where the damage is disproportionate to revenue share. The club doesn’t break this out separately, but premium seating at London Stadium (Club London, suites, hospitality boxes) is concentrated among contracts that are typically 2-5 year terms with renewal cliffs at relegation. Industry rule of thumb is 25-40% revenue contraction on premium products in Year 1 of Championship football: lower fixture quality kills both the visiting-fan dynamic and corporate entertainment value. Of the £38.6m match income, roughly £14-18m is hospitality/corporate; expect £5-7m of contraction. The £15m one-off London Stadium usage fee paid in 2016 continues to be released to P&L on a straight-line basis until 2115 (circa £150k pa) , irrelevant to the decision.

Commercial (£41.4m → circa £28-33m). Sponsorship contracts at virtually all Premier League clubs contain Premier League warranties , relegation triggers either termination rights or step-down clauses, typically reducing sponsorship value by 30-50%. The accounts state “The Company’s own major sponsorship and partnership agreements are also in place until the end of seasons 2025-26 and 2026-27 respectively” which means renewal at Championship rates would be the bigger hit, but step-downs in existing deals will start in Year 1. 

Pre-season tour income (referenced in the FY25 commentary) collapses, Championship clubs do not command US/Asia tour fees. Anticipated Year 1 contraction: £8-13m.

Retail and merchandising (£13.7m → circa £9-11m). Less elastic than is commonly assumed because the existing fanbase keeps buying. International/casual buyers fall off. Loss: £3-5m.

London Stadium rent. A small offset: under the terms of their 99-year lease for playing at the London Stadium, West Ham’s annual rent of £2.5m will be halved should the club drop into the Championship. Saving: c.£2-2.2m, mostly cosmetic at this scale.

Aggregate Year 1 revenue impact: turnover falls from £226.1m to approximately £120-130m, a contraction of c.£95-105m. Add a further £6-8m EBITDA-equivalent saving from the rent reduction and lower stadium operating costs, you still have the revenue base sliced almost in half.

Squad cost analysis, wages and amortisation

The FY25 accounts give wages and salaries of £150.7m (total employment costs £173.3m incl. social security and pensions). Public sources put the 2025-26 first-team wage bill at an estimated £1.7 million per week = c.£88m gross weekly-wage equivalent, with broader salary databases triangulating to around £82.3 million in 2025/26 season. The gap between the £88m first-team figure and £150m+ accounting wages reflects bonuses, image-rights, NIC, signing-on amortisation, academy and women’s team payroll, and management/coaching cost (note Lopetegui paid off January 2025, Potter paid off September 2025, both with severance flowing through 2024-25 and 2025-26 P&L respectively).

The squad cost picture entering a relegation scenario, built from the publicly-tracked transfer ledger and contract durations:

(Wages triangulated from Capology / SalaryLeaks / FootballFanCast; amortisation derived by spreading capitalised cost over contract length per the FRS 102 methodology Note 1c uses; NBV approximate, given the 5-year FRS 102 maximum vs UEFA Annex G 5-year cap which the accounts highlight in Note 33.)

Two patterns matter for the relegation case. 

First, the squad’s amortisation tail is heavy and front-loaded: the FY26 amortisation charge is likely north of £105-115m given the 2025 summer window, even before the January 2026 additions add a further circa £12m of run-rate amortisation. Second, the long contracts (Wan-Bissaka to 2031, Kilman to 2031, Magassa to 2031, Diouf to 2030) are precisely the structures that the EFL warns create relegation distortion , long-dated capitalised cost carrying forward into the Championship even if the club halves wages.

Relegation clause effect on wages. The Athletic previously reported West Ham’s first-team squad have 50 per cent salary reduction clauses in their contracts in the event of relegation. 

If West Ham drop into the Championship, their current weekly wage bill of £1.7m would fall to around £850,000. Applied properly: first-team wage cost falls from c.£88m to c.£44m, total employment costs fall from £173m to roughly £125-130m (the non-playing wage base, social security/NIC and academy/women’s are not subject to the clause). 

This is a circa £45m saving , large in absolute terms but only about half the revenue contraction.

The clause is not without execution risk. As the agent commentary noted, players already react by demanding higher signing-on fees and exit clauses, and in practice star players with relegation-clauses tend to negotiate releases or force moves rather than honour the wage cut , this is what Bowen, Paquetá, Fernandes and Summerville would all attempt. The £44m saving is the contractual ceiling, not the realistic outcome.

Crucially, amortisation does not fall on relegation. The £100m+ annual non-cash charge continues unchanged , and, indeed, FRS 102 requires impairment review of the first-team CGU. With Championship cash flows, several recent acquisitions (Füllkrug £22m at age 31, Guilherme £19.5m unplayable, Todibo £36m post-loan, Pablo £20m unproven) would face impairment write-downs in addition to the amortisation already in flight. Expect a non-cash impairment charge of £30-60m in the year of relegation.

Most sellable assets

Liquidity in a forced sale is what matters here. Ranked by realistic mid-2026 transfer market value net of remaining amortisation (i.e. P&L profit at sale):

1. Mateus Fernandes, £40-55m achievable, NBV c.£40m. Modest accounting profit; large cash inflow. Premier League-sticky asset, age 21, attracting top-half interest. Most sellable in book and cash terms.
2. Crysencio Summerville, £25-30m, NBV c.£16m. PSR-friendly profit of £9-14m. Premier League market, age 24.
3. Jarrod Bowen, £35-45m. NBV negligible (legacy contract). Almost pure profit on disposal, this is the swing PSR/SCR asset. England international, captain. Sentimental but the obvious asset to monetise if the club needs to manufacture a profit on player sales in the relegation year.
4. Max Kilman, £25-30m, NBV c.£28m. Roughly book-value disposal. England-eligible centre-back, good Premier League market.
5. Jean-Clair Todibo, £20-30m, NBV c.£29m. Likely book-value or small loss. France international with Champions League pedigree.
6. Mads Hermansen, £20-25m, NBV c.£18m. Young goalkeeper, marketable.
7. Aaron Wan-Bissaka, £15-20m, NBV c.£12m. Long contract a positive for buyers.
8. Taty Castellanos , £20-25m, NBV c.£24m. Age 27 limits pure resale value. Likely break-even.
9. El Hadji Malick Diouf / Soungoutou Magassa, £15-20m each, both at or above book.

Less liquid: Füllkrug (loan to Milan with option), Pablo (no Premier League track record), Wilson/Walker-Peters/Fabiański (free transfer cohort, no transfer fee value), Souček (28+, expiring 2027, valuable to a Championship side at limited fee). Ward-Prowse is sellable (£10-15m) and is precisely the player a parachute Championship squad needs, so internal optionality exists.

Realistic Year 1 fire-sale yield: £140-180m gross if Bowen, Fernandes, Summerville, Kilman and one of the goalkeepers leave. Profit on disposal recognition: c.£40-70m, which is necessary to pass PSR/SCR. 

The cash, however, will be at heavily back-loaded payment terms , recall that £71.7m of FY25 transfer receivables were already factored without recourse, and £195.8m of transfer payables sit on the balance sheet. Net cash from disposals after honouring purchase instalments and applying R&MF haircuts: closer to £60-100m of usable liquidity, not the gross headline.

Credit facility impact

Three facilities matter:

• Barclays overdraft, £40m, expires 9 July 2026. Secured by fixed and floating charge on club assets. Renewed annually. The overdraft provided by Barclays Bank is secured by a fixed and floating charge on the assets of the Club. On relegation, expect Barclays to either (a) refuse renewal, (b) renew at materially higher pricing with tighter covenants, or (c) reduce the limit. Working assumption: limit cut to £20-25m, pricing widening 200-300bps. 
• R&MF £124m term loan, July 2025, 5-year, repayable June 2030. Secured by debenture on all club assets via inter-creditor agreement with Barclays. £89m drawn at signing, balance of £35m un-drawn. R&MF lend specifically against future Premier League TV money, that collateral evaporates on relegation. The facility almost certainly contains a Premier League membership covenant; even if it does not contain an outright event-of-default trigger, it will contain mandatory prepayment language linked to relegation, force a recalculation of the borrowing base, or cap further drawdown. Best case: the £35m un-drawn portion is no longer accessible. Worst case: a partial mandatory prepayment from any Premier League final-position payment.
• Barclays £5m Rush Green training-ground loan repaid 29 August 2025 , irrelevant going forward.

In aggregate, the club should assume available headroom contracts by £40-60m on relegation, against a base case where £124m of R&MF is essentially fully required just to bridge transfer payable timing. The club’s Note 1b going-concern memo already warns of a Summer 2026 liquidity shortfall assuming Premier League survival. Relegation cascades into that shortfall directly.

Cash flow scenarios, promoted after one year vs two years in Championship

Built on a clean-room basis from FY25 as starting point, with current-season squad/wage cost overlaid, in £m. Both scenarios assume relegation at the end of 2025-26.

Scenario A , Relegated 2026, promoted at first attempt (return for 2027-28)

Note: under EFL Profitability & Sustainability Rules a Championship parachute club is permitted higher losses than a non-parachute club, so PSR is unlikely to bite immediately, but UEFA Annex G compliance (already disclosed at £3.9m adjustment in Note 33) becomes irrelevant in the Championship.

Scenario B, Relegated 2026, second season in Championship without promotion (i.e. back-to-back Championship)

*Year 2 wage savings accelerate as expensive contracts are released or sold, and replacement Championship-rated contracts come in.

The cumulative two-year cash gap to be plugged ranges from £130m (Scenario A best case) to £170m (Scenario B base case). The going-concern memo in the accounts already references the shareholder letter of support specifically anticipating this kind of shortfall under a severe-but-plausible scenario.

Market value / capitalisation impact

The club is privately held by WH Holding Limited (Sullivan 38.8%, Kretinsky 27.0%, Estate of David Gold 25.1%, J Albert Smith 8.0%). There is no listed market price. Three reference points for valuation:

• Forbes 2024-25: the strategic report references being listed as the 18th most valuable club in the world in 2024-25 in Forbes’ World’s Most Valuable Soccer Clubs list. Forbes’ 2024 valuation for West Ham was approximately $920m–$1.0bn (c.£735-800m).
• Daniel Křetínský’s most recent meaningful purchase of c.27% in 2021-2023 implied an enterprise valuation of c.£600-650m.
• Comparable transactions: Premier League survivors trade at 2.5-3.5× revenue; relegated clubs at 1.0-1.8× revenue plus parachute floor.

On relegation, expect equity value to compress sharply. A reasonable framework:

• Pre-relegation enterprise value: £700-850m
• Year 1 Championship enterprise value: £350-500m (40-55% impairment), reflecting the half-revenue base, deferred parachute cliff, deteriorated broadcast cycle exposure, and the asymmetric downside risk of a second season in the EFL
• Two consecutive Championship seasons: £250-350m, with the floor essentially set by stadium tenancy value, brand and Premier League re-entry optionality

Equity value (deducting net debt of c.£300-400m all-in once parent-loan,R&MF, overdraft, transfer payables and operating-lease present-value burden are aggregated): the club is materially closer to balance-sheet insolvency than the headline shareholders’ deficit of £216.6m alone suggests. The club is solvent only because the £176.3m parent loan is uncalled.

Will current investors be required to provide additional funding? Yes.

The accounts spell this out almost explicitly. Under both base case and severe but plausible scenarios in Note 1b: In the event other mitigating actions do not raise sufficient funding, certain of the investing owners have committed jointly, by signing a letter of support. The letter of support is conditional on the going-concern period , i.e. through end-December 2026 , and is referenced as a backstop for the survive-in-Premier-League scenario. Relegation makes that backstop a near-certainty rather than an option.

Required funding profile in a relegation event, based on the cash-flow scenarios above:

• Immediate (summer 2026): £60-90m of equity-equivalent funding to bridge the player-payable spike (£110.9m current creditors due, £100m+ further additions from the 2025 windows), Barclays overdraft headroom contraction, and the loss of access to R&MF un-drawn capacity. This is in addition to whatever incremental player-sale proceeds materialise.
• Year 1 in Championship: £60-80m additional equity injection, primarily to fund operating losses and amortisation gap.
• Year 2 if not promoted: £70-100m additional, with rising urgency.

Cumulative two-year ownership funding requirement: £190-270m in the worse scenario. This is not theoretical: it is the same order of magnitude as the existing £176.3m parent loan, suggesting the structure used to fund the 2024 and 2025 transfer windows would need to be repeated.

The political question is which of the four shareholding groups carries it. Sullivan (38.8%) is the historical lender of last resort. Křetínský (27.0%) has a put option implicit in the shareholder agreement; he has been the most active recent capital provider. Kretinsky’s vehicle (Vesa Equity Investment) has the deepest pockets but is not majority. Sullivan has signalled willingness to sell; relegation accelerates that conversation, with any sale process happening into a softer market.

Bottom line

Relegation is the proximate cause of an estimated £95-105m revenue loss in Year 1, partially offset by circa £45m of contractual wage savings , leaving a structural EBITDA gap of c.£50-60m on top of the already loss-making baseline. Layered on top: £30-60m of player-asset impairment, R&MF facility headroom contraction, Barclays overdraft re-pricing or reduction, transfer-payable concentration risk, and the continuation of full amortisation against a Championship revenue base. Cumulative funding requirement over a two-year Championship spell ranges from £130m (immediate promotion) to £190-270m (two seasons down). Equity value impairment of 40-55% on Year 1, deepening if not promoted at first attempt.

The accounts already disclose the conditional shareholder letter of support; relegation converts that conditional commitment into a hard funding call. The strategic question for the ownership group is not whether additional capital is required, it is whether to fund through the cycle or to use relegation as the trigger for a sale process at the bottom of the valuation curve.

Two caveats worth flagging. First, all post-balance-sheet figures (the January 2026 transfers, the Paquetá disposal, the Pablo/Castellanos/Traoré/Disasi arrivals) are sourced from public reporting rather than from audited accounts; the FY26 numbers will move. Second, the relegation outcome itself is genuinely live, Opta currently puts West Ham’s relegation probability at c.39%, with Spurs at 49.5% and Forest at circa 10%. The downside case modelled above is conditional on the drop, not its forecast.

Alternative scenarios

Part A, Partial squad  breakdown: Bowen + Fernandes + Summerville + Kilman

A.1 Disposal economics

The four-player disposal hypothesis is the cleanest PSR/SCR-friendly perimeter to test because it concentrates the largest profit-on-sale recognition into a single window. Working from indicative mid-2026 transfer market and book values:

Add NIC and other on-cost gross-up (circa 14%) to the wage-saving line: c.£11.2m of operating cost relief annually. Add the £23m of amortisation removed: total annual P&L relief from these four disposals is c.£34m.

The £61m profit on disposal recognition is the more important number for compliance. It is materially understated by the table because Bowen’s NBV is essentially zero , a 2020 acquisition fully amortised over a 2025 contract extension. If Bowen’s contract was renegotiated in 2024 or 2025 and the unamortised stub re-amortised over the new term, NBV could be £3-5m; the disposal profit then drops by that amount but remains the largest single profit-on-sale contributor.

A.2 Cash conversion is much weaker than the headline

Premier League and overseas transfer instalments are typically 40-30-20-10% over four windows, sometimes back-loaded further. Applied to the £140m headline:

If the club factors the long-dated receivables , which the FY25 accounts show is current practice (£71.7m factored without recourse in FY25, plus £12m post-balance-sheet) , Year 1 net cash from these four sales rises to c.£90-110m. But this is the gross inflow, not the incremental liquidity.

A.3 Cash has to fight existing player payables first

The FY25 balance sheet shows £110.9m of player-related creditors falling due within one year and £84.9m beyond , £195.8m gross. Add the £200m of FY26 summer 2025 spend (Fernandes £44m, Hermansen £21m, Magassa £17m, Diouf £21m, Todibo £36m permanent, etc.), of which a chunk falls due in summer 2026, and the picture is that any disposal cash primarily refinances pre-existing transfer obligations rather than funding operations. Factoring the existing receivables (£71.7m + £12m already done) was the FY25 mechanism for the same problem.

True incremental liquidity from a £140m gross disposal slate, after honouring existing transfer payables that fall due in the same windows: £30-50m Year 1, possibly £20-30m Year 2 once the next instalments arrive. This is the number that actually flows into the going-concern model.

A.4 Two-year trajectory with the breakdown applied

Layered onto Scenario A (relegated 2026, promoted at first attempt) and Scenario B (two seasons in Championship):

Scenario A with breakdown (relegated 2026, promoted 2027):

* Lower than baseline due to lost ticket-yield from departed marquee players and modest commercial knock-on ** Slightly lower than baseline given weaker squad on PL return , promotion bonuses consume some saving *** Promotion bonuses included; replacement signings on shorter PL contracts

Two-year ownership funding requirement under breakdown + immediate promotion: £75-105m, vs £100-140m without the teardown. Material improvement.

Scenario B with breakdown (relegated 2026, second Championship year 2027):

Two-year ownership funding requirement under breakdown + two Championship years: £90-125m, vs £130-180m without.

The breakdown materially de-risks the ownership funding ask, but doesn’t eliminate it. Roughly 30-40% of the funding gap is absorbed by the four disposals.

A.5 PSR/SCR position post-breakdown

Premier League PSR (rolling three-year £105m loss limit):

The relegation year is the critical one. Tracking the rolling window from the audited base:

Rolling three-year ending 2024-25: (85.3) , still inside the £105m limit but only just.

Rolling three-year ending 2025-26 (if the club stays up): (185.3) , breaches PSR by £80m. The breakdown helps because the £61m profit on disposals would be recognised in 2025-26 if executed before 30 June 2026, dropping the year’s loss to c.£30-40m and bringing the rolling test to c.(125) , still in breach by c.£20m. Survival without disposals would almost certainly mean a points deduction.

If relegated, the Premier League PSR is the wrong test for 2026-27 forward , EFL P&S applies. The Championship test is a £39m loss over three years for parachute clubs (£15m for non-parachute), with £8m allowable per year of “fair value” allowable expenditure on infrastructure and women’s football.

For West Ham, the EFL test is harsher in percentage terms. Modelled (£79m) loss in 2026-27 plus (£73m) in 2027-28 plus FY26 outturn , even with allowable adjustments , sits well outside the £39m three-year envelope. Sanctions in the Championship are realistic, with Leicester’s experience as the working precedent. The breakdown does not solve this; it merely postpones the breach.

UEFA SCR is irrelevant if relegated (no UEFA competition) and would in any event require the squad cost ratio (player wages + amortisation + agent fees as % of turnover) to be capped at 70% from 2025-26. West Ham’s FY25 ratio: (173.3 wages + 99.4 amort + circa 9 agent fees) / 226.1 turnover = 125%. Already in material breach against the 2025-26 limit; the disclosed Annex G adjustment in Note 33 of £3.9m is for player amortisation only and doesn’t address the total cost-ratio gap.

A.6 Ranking the disposals by efficiency

If the ownership group wanted to reduce the size of the breakdown to the minimum required to pass the FY26 PSR test (assuming continued PL membership), the ranking is by profit-on-disposal per £m of squad disruption:

Bowen alone solves the PSR problem. He is the asset where the disposal profit is essentially equal to the replacement cost, making the trade economically self-funding, and where the £37m of disposal profit single-handedly closes the 2025-26 PSR gap. This is the structural reason the player has been linked with summer departures despite his on-pitch importance: he is the most cost-efficient lever on the balance sheet.

Part B , Parent loan refinancing under different ownership outcomes

B.1 The £176.3m parent loan:

Note 14 / 15 disclose £176.3m owed to parent (WH Holding Limited), interest-free, repayable on demand. WH Holding is the consolidating parent. The economic substance: this is shareholder equity through a debt label. Three mechanical features matter.

First, it has not been formally subordinated in the FY25 disclosure to either the Barclays overdraft or the R&MF facility. R&MF’s debenture and inter-creditor will almost certainly include a non-distribution / standstill on parent-loan repayment as long as senior debt is outstanding , this is standard private credit drafting , but the specific terms are not public. Second, it bears no interest, which is friendly to the operating P&L but creates accounting tension under FRS 102 Section 11 if the loan is not at market rate (the accounts have taken the FRS 102 qualifying-entity exemption from imputed interest disclosures). Third, it can be capitalised into share capital at the holding level at any time, converting the debt to equity without requiring fresh cash , this is the cleanest mechanism for the owners to reduce balance-sheet leverage when needed.

The four-shareholder split at WH Holding (Sullivan 38.8%, Křetínský 27.0%, Gold estate 25.1%, J Albert Smith 8.0%) means the parent loan is funded pro-rata, or close to it , though the precise split is not disclosed. Treat any new funding request as roughly tracking those proportions unless a single shareholder steps up disproportionately.

B.2 Funding requirement to be met

Combining the worst-realistic scenarios from Part A and the prior analysis:

The realistic central case for relegation planning: £100-140m of fresh equity-equivalent funding required over 2026-27 and 2027-28, in addition to refinancing the existing £176.3m parent loan and the £124m R&MF facility at maturity in 2030.

B.3 Five refinancing scenarios

Scenario 1, Pro-rata top-up by existing shareholders.

Each shareholder funds in proportion to current holding.

Mechanically simplest. Avoids dilution and preserves the ownership balance. The risk is the Gold estate , an estate is liquidity-constrained by definition, and trustees have a fiduciary duty that may not align with backing a loss-making football club indefinitely. If the estate refuses to participate, the others either fund the gap (changing ratios) or trigger pre-emption rights and a forced restructuring.

Scenario 2, Sullivan exits, Křetínský takes control.

Sullivan has been a public seller since at least 2024. Křetínský holds a known interest in increasing exposure. A relegation event compresses the valuation Sullivan can extract:

Křetínský would then assume primary funding responsibility , perhaps £80-100m of the £120m mid-case. The transition would likely be structured as a rights issue at the holding company level rather than a direct purchase, allowing the new majority to capitalise the parent loan (eliminating the £176.3m on-demand creditor) and inject fresh equity in a single restructuring. Effective cost to Křetínský: existing loan exposure (£50-70m current) + £100m fresh + share-purchase consideration to Sullivan = total cash deployment £200-300m for control. This is the realistic bear-case acquirer route.

Scenario 3, New strategic / PE investor.

US sports private equity (Clearlake, RedBird, 777 Partners pre-collapse, Arctos, Ares) and Middle Eastern sovereign-adjacent vehicles have been active in Premier League and Championship deals. A relegated West Ham at distressed valuation is exactly the asset profile such buyers target , large fan base, premium stadium tenancy, London market, parachute optionality, immediate promotion case.

Realistic structure:

• Pre-money equity value at relegation: c.£250-350m
• New investor takes 40-55% stake at post-money £450-550m
• Cash consideration £150-225m, of which £100-140m is primary (into the club) and £50-85m is secondary (to existing shareholders, principally Sullivan)
• Existing parent loan £176.3m converted to equity as condition precedent

The dilution math is brutal for incumbents. A Sullivan stake taken from 38.8% to circa 17-20% post-money, valued lower in absolute terms despite the secondary cash. But it eliminates the ongoing funding obligation.

The political risk is the Independent Football Regulator’s owners-and-directors test, which is now live and has been assertive on source-of-funds. State-linked PE will face material scrutiny. The realistic acquirer profile is therefore narrower than the universe of theoretical buyers.

Scenario 4, Distressed senior credit refinancing instead of equity.

If the owners refuse to inject equity, the alternative is to extend R&MF or layer a junior tranche. Working assumptions:

• R&MF current £124m facility at estimated 7-9% all-in (commercial estimate; not disclosed). Drawn £89m at signing.
• Incremental £75-100m of senior or second-lien debt potentially raisable post-relegation, secured against parachute receivables and remaining transfer-fee receivables, at materially higher pricing , call it 11-14% all-in given the relegation status and constrained collateral.
• Annual interest cost on aggregate debt stack: was £22m FY25; rises to £35-45m by 2027-28 under this scenario.
• This solves liquidity but worsens P&L and cumulative loss position, accelerating the EFL P&S breach trajectory.

The structural problem with debt-only refinancing is that interest expense compounds the operating loss, which compounds the cumulative loss test under EFL P&S, which compounds the sanctions risk, which compounds the financial distress. Debt is a one-cycle bridge, not a solution. Realistically only viable as a short-term measure pending one of Scenarios 1-3.

Scenario 5, Capitalisation of parent loan + asset-light strategy.

The cheapest restructuring move: convert the £176.3m parent loan into equity at the holding-company level. This:

• Removes £176.3m of on-demand liability from the operating company balance sheet
• Reduces shareholders’ deficit from (£216.6m) to a modest deficit or marginal surplus position
• Costs the shareholders nothing in cash , they merely formalise that the loan was always equity in substance
• Does not solve the operating cash burn

Combined with aggressive squad disposal (Part A teardown plus second-tier disposals , Wan-Bissaka, Hermansen, Todibo if needed), this could reduce the fresh cash funding requirement to perhaps £50-70m over two years rather than £100-140m. The trade-off: you exit the Championship with a denuded squad and a longer promotion timeline, but the ownership-funding ask is contained.

This is the scenario most consistent with the FY25 going-concern memo language. Note 1b’s reference to cash receipts from further player trading inclusive of the factoring of those transfer fee receivables as necessary or, should this not be preferred or sufficient, additional funding from the shareholders would be required reads as a sequence: player sales first, factoring second, shareholder funding third. The capitalisation move would sit alongside step three.

B.4 Probability-weighted view

Setting aside which scenario the ownership group prefers, the externally-observable probability stack on a relegation event:

The single most likely path is Scenario 2 with elements of Scenario 5 , a Sullivan exit to a Křetínský-led majority, conditional on the existing parent loan being capitalised at completion, with squad disposals running in parallel to demonstrate good-faith mitigating actions to the IFR. This is what the FY25 letter-of-support construct points toward: the going-concern statement explicitly references support coming “either by one certain shareholder individually or by a combination of certain shareholders”, language that is doing work, suggesting the owners have already discussed which of them backstops the gap.

B.5 What it means for the FY25 going-concern conclusion

The audit opinion on FY25 was unqualified, with no material uncertainty paragraph. PwC concluded the directors’ going-concern basis was appropriate. This conclusion is sustainable so long as:

1. The £40m Barclays overdraft is renewed in July 2026 , high probability if Premier League survival, much lower if relegated.
2. The £124m R&MF facility remains undrawn beyond £89m, high probability under PL survival, conditional under relegation given likely covenant pressure.
3. Player sales continue at the FY25-comparable run-rate , execution-dependent.
4. The shareholder letter of support remains in force and is honoured, this is the audit-relevant comfort and is the variable most directly affected by ownership transition.

In a relegation scenario, items 1, 2 and 4 all come under simultaneous pressure. The next set of accounts (FY26, year-ended 31 May 2026, due to be signed off in late 2026) will be the more telling document, it will reveal whether the letter of support has been refreshed for the post-relegation period and whether the ownership scenarios above have crystallised into a transaction.