SINGAPORE - Valencia president Anil Murthy has told the Spanish La Liga's club's supporters that it needs to be "responsible" as it braces for the "serious" impact of Covid-19 on football.

In an open letter to them on the club's website, the 47-year-old Singaporean, a former diplomat, sought to explain the realities facing the club on two fronts: the summer market in signing players and plans to build a new stadium.

He also launched a staunch defence of the club's financial stewardship under Peter Lim, following protests from a section of vocal Los Che fans who have accused the Singaporean billionaire of "negligently managing the club" and "deteriorating the value of the team".

NEED FOR FINANCIAL PRUDENCE

Murthy highlighted that the club is in better financial shape now than in the recent past - it racked up debts of up to €547 million (S$888 million) in June 2009 - and has been able to start financing the debts from 2017, when previously it had not done so since 2009.

He noted that when Lim became the majority shareholder in 2014, "there was a total of €48 million in player salaries unpaid, and no cash in the bank".

In 2019-2020, Valencia had "by far their greatest ever income in history". They also won a first title in 11 years, the Spanish King's Cup.

But even with its Copa del Rey success, continuing to spend imprudently on players, he added, was "not sustainable". "We stopped it and cut losses before we go too far into trouble," explained Murthy.

Valencia competed in the Champions League in the last two seasons and reached the 2019 Europa League semi-finals. But they finished ninth in the recent La Liga season, and failure to qualify for European football is a financial setback, as clubs can earn €15.25 million and €3 million respectively in group-stage base fees in the Champions League and Europa League, with add-ons for wins, draws and progress to the latter stages.

There will also be a financial hit from the coronavirus pandemic, Murthy added, with the club's total income likely to be halved over the next two seasons, commercial income from attendances and sponsorship also dropping by 50 per cent while television rights money could fall by about 30 per cent.

"So we have to rebuild," he said. "This is neither the beginning nor the end. We must learn from the past.

"Pushing the (idea of having) 'big stadium, big players, win La Liga and Champions League at all cost' will lead to a repeat of the past."

In his first public comments on the matter, owner Lim also reminded the fans: "A bankrupt club is not a better club."

TRANSFER MARKET

In a bid to reduce their wage bill, Valencia sold winger Ferran Torres to Manchester City for €23 million while midfielders Francis Coquelin and Dani Parejo joined Villareal for a reported combined €11 million to Villarreal.

It was yet another source of unhappiness for fans but Murthy said Torres, 20, a product of the club's youth academy and a player the fans loathed to see leave, "chose to leave in spite of being offered one of the best salaries in the team".

"Each one chooses their path," he added. "We learn from this experience but we don't forget. We have a good group of players from our academy coming up and we will make sure we don't have this kind of problem again."

STADIUM PLANS STALLED

Murthy also addressed ongoing efforts to sell and redevelop the club's Mestalla stadium, after a deal with ADU Mediterraneo fell through as the real estate developers could not secure financial guarantees for the reported €113 million transaction.

He laid bare the club's "sustainable model" to finance the project, saying that the "simple plan" involved:

- Selling the facility for a minimum of €120 million

- Building it for €150 million with financing for the remaining €30 million

- Increasing the capacity to a possible 65,000, up from the current 48,600

- Increasing season ticket prices and general public tickets by an average of 15 per cent to support the operating costs of a bigger stadium.

"Now with the current economic climate during Covid, investors are waiting," said Murthy. "But many are asking. We will continue to work with the Generalitat and the Ayuntamiento (government bodies) on this important project for the city (and) find a solution to the new stadium."

He again stressed that the club is taking a careful approach to the matter, saying: "This is a project that has led to the bankruptcy of the club before. We are not going to sell all of our players to build a new stadium!"

Urging patience, he added: "We are committed to build a sustainable club and to keep it growing. It takes time."

For the latest updates on the coronavirus, visit here.

This article was first published in The Straits Times.