Southend United given go ahead to pay £300k to creditors and start non-league season

Southend United will be able to start the football season in the National League, thanks to a court ruling.

There had been fears that the club was about disappear due to mounting debts.

Earlier this week chairman Ron Martin said he was willing to sell his stake in the club for a pound.

Takeover talks have been going on since May, and there were protests last weekend. The club could not find enough players for a friendly, so fans demonstrated close to his home.

Speaking on Tuesday, Chris Phillips, a journalist in the city with the Southend Echo, described the move as a "last throw of the dice".

"This is the saddest it's ever been, it's the most worrying it has ever been, we're on the eve of a new season and none of us know whether or nor we'll be able to start it.

"It's not looking very good to be able to stand here now thinking there might be life without Southend Unite. It's completely heartbreaking for me and it's completely heartbreaking for so many people in our city and out community."   

On Friday a specialist court heard the non-league club has existing debts of £2.5m, about £300,000 of which is owed to football creditors.

The remaining amount is owed to other creditors including HM Revenue and Customs (HMRC), which issued a winding-up petition against Southend over a £275,000 tax debt, and energy supplier Npower.

Judge Mark Mullen approved payments of more than £300,000 at Friday's hearing, which will allow the club to keep its licence and remain in the National League.

Chairman Ron Martin gave an undertaking to the judge that he would notify the remaining creditors of the payment in order to secure the court's approval.

He told the court the club was ready to pay £250,000 to its football creditors, and that a further £52,000 had been obtained from the Premier League for academy players.

The payment had to be approved by the court due to the club being insolvent, and the judge said any further prospective payments would also have to be notified to outstanding creditors and approved in the same way.

Mr Martin said the club has also been able to agree a payment plan with Npower, and that the first instalment was due to be paid next week.

Addressing the judge, Mr Martin, who has been in charge of the club for 25 years, said: "I'm sorry I keep coming before you, but it is coming to an end."

A further hearing is due to take place on 23 August.

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