Royal AM Football Club is currently facing severe financial difficulties, and the new owners will inherit a substantial debt load upon acquisition. Financial analysts suggest that running the club in the first month alone could require as much as R65 million.
Debt Inheritance and Bidding Process
The South African Revenue Service (SARS) has initiated the sale of the KwaZulu-Natal-based club to recover outstanding tax debts, which reportedly amount to R40 million, owed by current owner Shauwn “MaMkhize” Mkhize. The bidding process is set to commence next Friday, with interested buyers required to place a R1 million deposit. The successful bidder will be announced on March 17 and will be responsible for taking on all existing liabilities of the club as stipulated in the draft sale agreement.
Financial Challenges and Expert Analysis
Financial analyst Nqobile Ndlovu from Cash and Sport estimates the club’s actual worth to be around R30 million when factoring in its debts. Among the major financial obligations is an outstanding R15 million owed to former player Samir Nurković. Additionally, operational costs such as salaries, travel, and accommodation could add another R45 million to R50 million to the club’s financial woes. As a result, prospective owners should be prepared for a significant initial investment just to stabilize operations.
Match Backlog and Operational Hurdles
Royal AM has not played any official matches since December 29, 2024, resulting in a backlog of nine games. The draft sale agreement mandates that new ownership must adhere to the Premier Soccer League (PSL) schedule once the acquisition is finalized. However, concerns remain about how the club will handle the congested fixture list and operational demands.
FIFA Transfer Ban and Player Disputes
Further complicating matters, Royal AM is currently under a FIFA-imposed transfer ban due to unpaid wages owed to Nurković. This ban will only be lifted once the debt is settled. Moreover, six additional players have filed claims seeking early termination of their contracts, adding to the club’s legal and financial troubles.
The new owners of Royal AM will face an uphill battle in reviving the financially strained club. With millions in inherited debt, unpaid player wages, and fixture congestion, turning the club around will require a massive financial commitment and strategic management. Whether a new buyer can successfully navigate these challenges remains to be seen, but it is evident that the road ahead will not be easy.
Related article: Royal AM Up for Sale – How to Bid for the Club and What’s at Stake
