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Aug 13, 2008

Toon owner Ashley reveals £27m player debt

Newcastle's billionaire owner Mike Ashley has revealed that the club owe £27million for players bought before he took over last year.

In a rare interview in a new, official club magazine, Ashley admits that he did not perform due diligence before buying Newcastle from the Hall family because the deal was completed so quickly.

With the full details of the club's financial situation now emerging, Magpies' fans may point to the debt as the reason why the club have been reluctant to spend on new players this summer.

Despite putting in £100m over the past year to reduce debts, Ashley has only sanctioned the signing of two new players so far, Danny Guthrie and Jonas Gutierrez, with manager Kevin Keegan hoping to sign at least three more before the transfer window closes.

'Financially, Newcastle United was in a difficult positon because I really do think that it had over-extended itself,' Ashley said in NUFC Magazine.

'We first heard about the potential sale on a Saturday and had the deal done by the Wednesday, so if you are asking if we did due diligence before buying, then the answer has to be no.

'One of the most unfortunate things about Newcastle United's finances at that time was the amount of money still owed on players signed in comparison to the amount of income that was due in off players who had gone.

'There is still £27m net to pay on transfers that were done before I came. So probably in the latter years before we came in you could argue that the club was beginning to lose its way.

'It had also already taken upfront payments from commerical deals and sponsorships which didn't help us at all. It seemed as though the club was in a very downward sprial, one it would have found very hard to come out of.'

Ashley, though, insists that his club are 'one of the diamonds of the Premier League' after speculation had suggested he was looking to sell the club and get a return on his £137million investment.

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