The South African Revenue Service’s imminent sale of Premier Soccer League (PSL) outfit Royal AM will more than likely come with a massive discount - maybe even half the price Shauwn Mkhize paid for the club in the first place.
Mamkhize, as the flamboyant Mkhize is known, bought Bloemfontein Celtics’ top-flight status in August 2021 and moved the team to KwaZulu-Natal from the Free State. She paid about R50 million for Celtics, before renaming the club Royal AM.
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However, less than four years later, the club is set to be sold after SARS seized control of a number of owner Mkhize’s assets, including the football club, allegedly due to the controversial businesswoman owing the tax collector around R40 million.
On Monday, Sars got the green light to go ahead and speak to potential buyers after Mkhize’s application to take back control of the club was denied by the courts.
But the writing was on the wall after a tumultuous year after the club went from one scandal to another.
The club was hit by a FIFA transfer ban in January over the outstanding payment of former striker Samir Nurkovic, who the club owes around R15 million in salary payments (plus interest).
The club also owes Ricardo Nascimento outstanding monies after the former Mamelodi Sundowns defender also won his dispute against the team for unpaid salaries.
Because of the transfer ban, Royal AM were unable to sign new players and couldn’t field a team in the DStv Diski Challenge They were eventually booted out of the competition by the PSL.
In December, Royal AM failed to pay their players’ salaries before they were put under curatorship by Sars for the unpaid taxes. This then led to the suspension of the club from league and cup fixtures.
It seems like the end of the saga is near, with Sars hinting that they have found a possible buyer. However, the value of the club is now significantly lower than the R50 million Mkhize paid to buy Celtics.
The new owner is coming on the backfoot, having to deal with a variety of issues, including the transfer ban and the sitting right at the bottom of the league table.
First of all, the R15 million owed to Nurkovic doesn’t magically disappear if new owners take over the club. That money must still be paid to the striker, while Nascimento must also get what he is owed.
The same goes for the players who haven’t received their full salaries over the last couple of months. The new buyers also take over the contracts of each and every player who is signed with the club.
The threat of relegation is also very real when it comes to the KwaZulu-Natal club. Royal AM, who haven’t played a league or cup match since December 29, are currently sitting right at the bottom of the league standings, with eight points from 11 matches.
Most of the other teams in the league have played between 15 and 17 matches, which means the club will likely be playing twice or thrice a week to catch up with their fixtures.
PSL boss Irvin Khoza wants to protect the integrity of the league, which means finishing it with 16 teams. So they will move mountains once this deal is done to get Royal Am caught up and before possibly pulling the trigger and expelling them, which would essentially create more chaos
Getting relegated basically halves the value of your club, because of the perks that come with playing in the top-flight. The PSL grant is about three times more for Betway Premiership clubs compared to those who play in the Motsepe Foundation Championship.
Whoever buys Royal AM, they will be taking on a lot of baggage. So expect the price to be worth the trouble.
@JohnGoliath82