Plymouth City Council will loan £800,000 to local football team Plymouth Argyle in a bid to help the League Two club settle debt payments.
The local authority described Plymouth Argyle as ‘hugely important’ to the region’s economy and offered the football club support to help it resolve obligations with ‘football creditors’.
Councillors agreed on a 4.8% interest rate for the five-year loan, which they described as a ‘win-win’ for the town hall.
Akkeron Group took Plymouth Argyle out of administration in 2011. The council’s loan is expected to support the team repay creditors earlier than a 2016 deadline established by the Football League and the Professional Footballers Association.
Cllr Mark Lowry, cabinet member for finance, said the loan was ‘a pragmatic and proactive response’ to difficulties inherited by the club’s owners. He added that the club’s future would now be ‘more secure’.
‘By offering a loan on commercial terms and with security provided by entities associated with the shareholders, it is win-win for Plymouth. Not only does it help secure the future of the club, which is important for the city, it is providing a good rate of interest to the council and therefore value for taxpayers,’ Cllr Lowry added.
‘While the council is not usually in the business of offering loans, especially at time when we have to reduce spending due to Government cuts, the interest we earn makes it a good use of our revenue balances.’
