(Bloomberg) -- The latest sale of an English Premier League club comes with an unusual financial twist.
The American owners of Burnley have agreed to hand the club back to its previous shareholders, including outgoing majority investor Mike Garlick, if they fail to make three deferred payments, people familiar with the matter said.
ALK Capital, led by Alan Pace, the former head of prime futures securities services sales at Citigroup Inc., assumed control of Burnley in December in a deal that values the team at more than 200 million pounds ($271.1 million).
The financial firm has so far paid 102 million pounds to the club's prior ownership group with the remainder to be made in three separate payments. About 60 million pounds of the up-front payment was raised through a loan provided by billionaire Michael Dell's MSD UK Holdings.
The rest of the up-front payment is made up from cash in the club as well as equity from ALK.
Pace said earlier this week during a call with reporters that the loans backing the purchase were “absolutely reasonable and in line with what can be supported by this club and will not take away from the club's ability to operate on a daily basis.” The company declined to comment on the payment arrangement with the former owners.
Burnley is the latest European soccer club to have been purchased by Americans. In recent months France's Toulouse FC and Italy's Parma and Roma were snapped up by American buyers who said European soccer investments offer better value than U.S. sports teams. At least seven Premier League teams have American owners, including Arsenal, Liverpool and Manchester United.
Rich Americans Plow Fortunes Into European Soccer Bargains
Like all 20 Premier League teams, Burnley can count on 100 million pounds of broadcast income annually, so long as it isn't relegated. The club currently sits at 16th in the Premier League standings, just two spots ahead of the relegation zone.
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