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Are Scunthorpe United Set to Become the Latest English Football Club to Go Out of Business?

Final Demand PaperworkWith a captive audience and several revenue streams available, professional football clubs really shouldn’t go out of business – regardless of their size.

But mismanagement by key personnel behind the scenes – be it well meaning or more nefarious – continues to blight the lower leagues of English football in particular, and Scunthorpe United are the latest to teeter towards oblivion.

Formed in 1899, Scunthorpe spent 72 years unchecked in the Football League – climbing as high as the old Second Division in the 1950s, but now they face the prospect of going bust despite years of savvy financial control.

The Iron have sold a number of players for £1 million plus in the last decade or so, including Billy Sharp and Gary Hooper, so their plight comes as something of a surprise.

But things have become so bad that the club has been issued with a winding-up order by HMRC, and if a proposed takeover is not completed there’s every chance that Scunthorpe United could go the way of Bury, Chester City and Macclesfield Town into footballing annihilation.

Where Did It Go Wrong for Scunthorpe United?

Chart on Desk Showing Falling Trend

Up until 2018, Scunthorpe United was one of the most financial-savvy around.

They were one of just three debt-free clubs in the English professional game, and while they are not a commercial juggernaut due to having a small catchment area and relatively small crowds, the Iron were able to thrive regardless.

Much of that was down to the frugal but sensible planning of former chairman Steve Wharton, who was also the club’s majority shareholder.

Unfortunately, he decided to step down in 2013, but promised to continue his legacy by handing Scunthorpe a £2 million loan to keep Scunthorpe above water for the foreseeable future.

Wharton was replaced by Peter Swann, who was unable to replicate the feats of his predecessor in helping the Iron to succeed despite meagre means.

Swann has plenty of capital to call upon given his status as an entertainment mogul on the east coast of England, while his wife Karin was formerly a part-owner of her family’s hardware firm Wilko. Together, they own a number of racehorses, including former British Champions Sprint Stakes winner Sands of Mali.

But Swann has, seemingly, been unwilling or unable to invest in Scunthorpe United – the period playing behind closed doors certainly hitting his hospitality businesses hard, and he was forced to resign as chairman and put the club up for sale in 2022.

It had originally appeared as if a takeover was imminent in December – staving off the threat of liquidation, however a deal involving local businessmen and Iron supporters Ian Sharp and Simon Elliott appears to have hit the skids.

Talks are thought to be ongoing, but an unpaid tax bill – left behind by Swann, who has also failed to pay the club’s staff on time – has given HMRC no choice but to issue the winding-up petition.

The hope is that the consortium involving Sharp and Elliott will come to an agreement over the purchase of Scunthorpe United, but that is far from guaranteed. And another old and proud football club faces an uncertain future as a result.