Financial News

Sheffield United (LSE: SUT.L - news) have missed out on a £60m boost to their finances by losing to Burnley in football's Championship final.

Monday's defeat marks another turn in the fortunes of the Yorkshire side, known as the Blades, that has this year delisted from Aim and reached an out-of-court settlement with rival West Ham over its disputed relegation to the second flight two years ago.

Burnley will now ascend to the Premiership, football's top flight, netting additional broadcasting and other revenues that accountants Deloitte calculate to be worth in the region of £60m.

While Sheffield United's fans were weeping, the club's chairman, Kevin McCabe, who owns 75 per cent of the team, may be less perturbed by the financial fallout.

The property developer who lives in Brussels, sold his Scarborough property business to the Australian group, Valad, for £865m in 2007.

Sheffield United have also been boosted by the receipt of an undisclosed sum - thought to be in the region of £20m - when they settled a dispute with West Ham in March over the London team's controversial use of star player Carlos Tevez two years ago to avoid relegation at Sheffield's expense.

Although Burnley will receive a windfall from broadcasting revenues and gate receipts, leading accountants warned the team not to splurge the money by buying expensive players on long-term contracts lest the club get relegated next season and face financial difficulties, potentially pushing it even further down the league table in a downward spiral of failure.

"If you look at this year's Championship [the second division in English football], the clubs that have been relegated [to the third division] were Southampton, Charlton and Norwich, all of which have been in the Premier League in relatively recent times," said Pete Hackleton, a senior manager at Deloitte's sports business group.

"They have all got big stadia but they overspent and they came back down and they found themselves facing problems." The mood of austerity sweeping other sectors of the economy was increasingly being felt by new entrants to the top flight who see the virtues of more parsimonious spending once they are promoted.

"I think we've gone away from the time where clubs would get promoted and gamble on staying up by signing a lot of players on these long-term contracts," Mr Hackleton said.

"Clubs realise that, through spending prudently but making the right signings, they've got a real chance of staying up but what they don't want to do is overcommit and then find themselves in trouble," Mr Hackleton warned.