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Page last updated at 14:38 GMT, Monday, 2 August 2010 15:38 UK

Southend United stave off administration

Southend United

Southend United have avoided entering administration after reaching a deal with Her Majesty's Revenue & Customs.

HMRC had argued the club's history of defaulting on payments demonstrated it was insolvent.

But a High Court hearing on Monday ruled that the Shrimpers' existing debts have been settled and future payments would be on time.

The club still has to fight a winding-up order from Charterhouse Commercial Finance Plc on 11 August.

Despite striking the deal, HMRC has warned Southend officials they will be dragged before magistrates again should they miss any more payments.

Chairman Ron Martin told BBC Essex that the arrears had been met, in part, due to a partnership with Sainsbury's.

The supermarket giant hopes to build a new store on the Roots Hall site, with the Shrimpers moving to a new stadium.

He said: "We have entered into an agreement with them to deliver both of our objectives.

"We've made provision in our cashflows to make sure all debts, as they fall due, are covered over the next 12 months.

"I would have liked to have said some months ago that this is what I was anticipating, but the outcome is what I thought it would be."

606: DEBATE
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When asked whether the Charterhouse Commercial finance debts would also be covered, Martin added: "We've underwritten all the costs the club will encounter over the next 12 months."

Despite the positive news the Shrimpers are still unable to register players for the new season.

Manager Paul Sturrock is still hampered by a transfer embargo placed upon the club, but Martin believes that could be lifted as early as Tuesday.

"At lunchtime today I wrote to the Football League to tell them what we had achieved with HMRC," he said.

"I'm hopeful of getting a response from the Football League today or tomorrow and the embargo will be lifted."

Shrimpers Trust vice chairman Brian Woodford welcomed the news, saying: "It's going to be a bit strange on the first day of the season with virtually a new team.

"But I'm sure we will get to know the new players very soon."

The Shrimpers Trust is a group created with the aim of keeping a professional football team in Southend.



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