It may have seemed all but inevitable over recent weeks, but Hapoel Tel Aviv’s approach to the District Court on Tuesday requesting a stay of legal proceedings is nevertheless a watershed moment in Israeli soccer history.
Hapoel, a winner of 13 Israeli championships and 16 State Cups, is not the first club to find itself in such financial dire straits that it requires a court’s intervention to simply remain in existence. However, never has an Israeli club of such stature fallen so far from grace, with Hapoel’s debts estimated at over NIS 100 million.
Club owner Amir Kabiri said time and again over recent months that he is certain he can steady the ship and ultimately guide the team back to its glory days. Kabiri had big plans for Hapoel when he took over the club just 18 months ago, but he never truly seemed to fathom what he got himself in to.
It was only three months ago that he claimed the club’s debt stands at NIS 45 million, less than half of what was written in the papers filed at the Tel Aviv District Court on Tuesday.
There is truth to Kabiri’s claims that he isn’t responsible for creating much of the debt. He inherited a club with major problems following years of poor management under owners Moni Harel, Eli Tabib and Haim Ramon. However, it is not a coincidence that the club reached an alltime low under his watch.
He was clearly in over his head from day one, with players, and in particular lower paid club staff, having the payment of their salaries delayed numerous times in his short stewardship.
The 36-year-old is set to officially relinquish all control on Sunday, assuming judge Eitan Orenstein approves the request to name a trustee as expected.
The trustee will aim to reach agreements with the club’s many creditors, who will have to settle for less than they had hoped for, while looking for a new owner to take charge as soon as possible.
According to Israel Football Association regulations, a team that requests a stay of legal proceedings is immediately deducted nine points, which in Hapoel’s case will leave it with just five points after 12 matches, sending it to the bottom of the Premier League standings, six points from safety.
“With the financial situation at the club over the past 10 years, and its serious nature which was only fully revealed over recent months, the club decided that there is no option but to request a stay of legal proceedings, due to the growing debts, commitments and lawsuits which reach around NIS 100 million,” read a club statement.
The statement went on to say that Kabiri had invested huge sums and a great effort to try and stabilize the club before coming to the conclusion that there is no other option but to turn to the court for assistance.
Kabiri, who inherited much of his money and is an art collector, always looked out of place in Israeli soccer.
He had the best intentions, but the phrase that “the road to Hell is paved with good intentions” seems truer than ever in his case.
“I made many mistakes and made some moves I’m not at peace with, but we will learn from this and correct our mistakes,” he said three months ago. “The most pressing matter is the delay in the payment of salaries. Everyone at the club knows this can’t continue. The club will return to its old self despite the tough situation.”
Hapoel paid a dear price for Kabiri’s lack of experience in the world of sports, with the owner making almost every mistake in the book.
According to the documents filed on Tuesday, Kabiri spent NIS 43 million of his own money trying to get the club back on track. But with an income tax debt estimated at NIS 29 million, another NIS 15.5 million owed to different banks and in the region of NIS 41 million needed to be paid to different suppliers, he never had a chance.
Kabiri’s failure to fully understand the state of the club at the time of purchase and the complete overhaul that was required, led him down a path that was never going to end well.
While being a die-hard Hapoel fan resulted in Kabiri making far too many decisions with his heart rather than his head, the trustee will act swiftly and with little sentiment.
Sports director Eli Gutman is set to be relieved of his duties, while the likes of Aaron Schoenfeld, Omri Altman and Hen Ezra could all be sold in the January transfer window in order to generate income.
Hapoel fans can at least try and draw some encouragement from the way some other clubs recovered from a similar process.
After being relegated from the Premier League last season, Maccabi Netanya began its 2016/17 National League campaign in a nine-point hole following its approach to the District Court.
After 13 matches, Netanya, a former five-time Israeli champion, is already within three points of second place in the standings which will lead to promotion to the top flight at the end of the season.
More importantly, it has also found an owner in Eyal Segal, who paid NIS 1.5 million for the club after the trustee had reached agreements with the creditors regarding debts estimated at NIS 22.5 million.
Hapoel Petah Tikva, a former winner of six championships, underwent a similar procedure five years ago, with Hapoel Haifa also bouncing back from financial ruin.
However, none of those clubs dug themselves a hole quite as deep as the one Hapoel Tel Aviv finds itself in.
There were plenty of warning signs along the way, but they were overlooked by so many people, including those in control of the Israel Football Association’s Budget Control Authority.
Kabiri made countless mistakes in his short tenure, but he was certainly right when he said the latest move was inevitable.
Better days await one of the most illustrious clubs in Israeli soccer, but they will not be arriving any time email@example.com