Shockwaves have reportedly hit French football as Olympique Lyonnais, a club that recently reached the Champions League semi-finals, faces relegation to the second division, Ligue 2.
This surprising decision is understood to be a direct consequence of the significant financial debts accumulated by the club`s owners, the Eagle Football Group.
The Eagle Football Group is led by American businessman John Textor. According to last year`s financial reports, the group`s debts had escalated to an estimated £422 million.
As a result of these financial issues and the ownership`s apparent inability to demonstrate an improvement in the club`s financial health, Lyon was initially handed a provisional relegation to Ligue 2. This decision has now reportedly been confirmed by the financial authorities overseeing French football clubs, the DNGC.
Textor reportedly attempted to mitigate the situation and raise funds by selling players, the club`s women`s team, and his 43% stake in English club Crystal Palace, a deal valued at £190 million.
However, the authorities deemed these efforts insufficient, ruling that the club`s finances remained inadequately balanced, thus upholding the relegation.
Lyon has the option to challenge this decision through an appeal process.
Should the relegation be finalized, Reims, who were defeated by Metz in the promotion play-off, are expected to take Lyon`s place in France`s top tier.
Interestingly, Textor had previously expressed confidence last year, stating there was “no chance” Lyon would be demoted.
Beyond Lyon and his stake in Crystal Palace, the billionaire`s football portfolio also includes Brazilian side Botafogo and Belgian club RWD Molenbeek.
The proposed sale of Textor`s share in Crystal Palace to New York Jets owner Woody Johnson is currently pending approval from the Premier League, subject to their owners` and directors` test.
This situation also creates uncertainty for Crystal Palace`s European ambitions for next season. Their potential participation in the Europa League has been under scrutiny because Lyon also qualified for the same competition.
UEFA regulations include rules against common ownership of multiple clubs participating in the same competition, and Textor`s influence over both Lyon and Crystal Palace could potentially violate these rules. A decision from UEFA on this matter is reportedly anticipated soon.
Officials at Selhurst Park, Crystal Palace`s home ground, are understood to have been in discussions with European football`s governing body in an effort to avoid being excluded from the Europa League.
Lyon`s relegation adds another layer of complexity to their European situation for the upcoming season. While relegation *could* potentially lead to a points deduction that invalidates their sixth-place finish in Ligue 1 and thus their European spot, it is also possible that simply being moved to a lower division might not automatically negate their previous league standing and European qualification, depending on the specifics of the ruling and any appeal.
Under existing UEFA regulations concerning common ownership, if two clubs with the same owner qualify for the same competition, the club that finished higher in their domestic league is typically given priority to compete.
Historically, Lyon is one of France`s most successful and prominent football clubs, boasting seven Ligue 1 titles. They reached the semi-finals of the UEFA Champions League as recently as 2020 and last competed in the second division in 1989.
This unexpected demotion could potentially lead to a significant exodus of talent from the club, with several highly-rated players, including winger Malick Fofana (who has been linked with English clubs like Liverpool and Chelsea), potentially seeking moves away.
