Xerez has become the latest self-inflicted victim of the parlous state of the finances of Spain's soccer clubs, suffering the ignominy of falling from the first division of the Liga to the third in three years after failing to pay its players.
The Spanish Football Federation took the decision to send Xerez from Segunda B to the lowest echelon of La Liga after receiving a complaint by the club's players, who are owed 1.8 million euros. Xerez had already been demoted from Segunda A after finishing last in the division five games before the 2012-2013 season was over. The club had rubbed shoulders with the likes of Real Madrid and Barça in the 2009-2010 season. The last time it languished in Tercera División was in 1977.
After miraculously escaping being wound up in July, Xerez now faces the arduous task of paying back 30 million euros to creditors. The fate of the Andalusian club is just another example of deficient management in a large number of sides in the first and second divisions of the Liga, although Xerez has never been a stranger to financial problems, not even when it played in the far more lucrative first division.
Xerez became a limited sporting company in 1992. Since then, successive presidents of the club have failed to come to grips with the debts built up over the years. Xerez's fans would have preferred for the company to be wound up in order to start again from scratch. A number of club members have set up a new club under the name Xerez Deportivo Fútbol Club for that purpose.
The Jerez de la Frontera side has also had other troubles. In the 2001-2002 season when Luis Oliver was chairman, the team had to play its home games in the nearby town of Sanlúcar de Barrameda after a falling out with the local mayor. Curiously enough, with former Real and Barçelona star Bernd Schuster as coach, Xerez was on the verge of gaining promotion to the first division that season, something it eventually managed to achieve in 2009 with Esteban Vigo at the tiller.
Xerez has systematically failed to comply with the terms of the creditors' agreement it reached in June of last year. Since December, the club has not paid anyone, neither the players, other employees nor the taxman, who failed to receive the first payment due in March on recognized debt of 5.871 million euros. It also failed to meet regular payments due for the latest season amounting to 1.5 million euros. In all, Xerez has 212 creditors, including suppliers and the Social Security system.
The money owed to the taxman seemed likely to sink the club in July. However, Energy group prevented that happening by buying the club from Joaquín Morales and has been in charge since July 4. "We're not supermen but we want to move on and save Xerez. If we have to compete in the third division, we will do so, although we have lodged an appeal against the demotion and will ask the ruling to be frozen," said club spokesman Francisco Gallardo.