Leicester chairman Aiyawatt Srivaddhanaprabha has decided to clear the club’s debts.
Leicester City chairman Aiyawatt Srivaddhanaprabha has cleared the club’s £194 million debt to parent company King Power in order to alleviate concerns about the club’s finances. With a debt-to-equity conversion, the Thai businessman has relieved the club of its outstanding debts to parent company King Power, thereby lowering the club’s balance sheet costs.
The amount was owed to the Premier League club’s parent company, King Power International, which is owned by the Thai family.
However, the club’s chairman Srivaddhanaprabha – also known as Khun Top – has decided to show further commitment to the club by eliminating the debt, according to a club announcement on Wednesday.
“Over £194m in loans and related interest has been capitalized into equity issued to King Power International Co Limited (KPI), which is wholly owned by the Srivaddhanaprabha family,” the club said in a statement.
“These loans have been provided by KPI to the Club over the last four years to fund the construction of the Club’s world-class new training ground at Seagrave and to continue to support the Club’s investments into its squad and Women’s football during the COVID-19 pandemic.
“Their conversion into equity strengthens the Club’s balance sheet, lowers interest costs, and demonstrates King Power International’s commitment to the Club’s long-term sustainability.”
Srivaddhanaprabha’s gesture is the club’s second since the family took control in August 2010. It follows in the footsteps of his late father, Vichai, who tragically died in a helicopter crash outside of the King Power Stadium in 2018, killing two other passengers and the pilots.
Vichai completed a £103M debt-to-equity transfer in 2013 and, in both cases, it has been ensured that all existing shareholder investment in the club will not be carried forward as debt.
This does not make Leicester debt-free as such, as the club is reported to have various loans with other banks. However, the value of those pale in comparison to the £194m owed to King Power, and now it has been wiped, the club’s financial concerns have been eased.
Announcing the move, Khun Top backed the club to continue its growth: “I believe with all my heart in Leicester City and what the Club can achieve for our fans, our people, and our communities – in Leicester, Thailand, and around the world.
“The faith they continue to place in us to run their Club responsibly with ambition and integrity guides our decision making and remains vital to us building on one of the most successful eras in the Club’s history.”
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