Sochaux, a French team, has been demoted from Ligue 2 to the third division because their Chinese owners, the Nenking Group, were unable to provide the necessary financial assurances for them to remain in the second-tier.
Despite finishing ninth in the league standings, 10 points clear of the relegation zone, Sochaux was administratively relegated by the DNCG, the organization responsible for overseeing clubs’ finances.
The team, which was one of the original members of the French League, had challenged the decision, but the DNCG recently confirmed their demotion.
Sochaux stated that they had significantly decreased the club’s salary expenses and sold players to save money, but they required financial support from the Nenking Group to cover the expected deficit until June 30th, 2024, which did not happen.
“Given the situation in the Chinese property market, which deteriorated again in the second quarter of 2023, the Nenking Group was unable to generate sufficient cash to cover FC Sochaux-Montbeliard’s (FCSM) projected deficit,” the club said.
“So it was without this evidence of a bank transfer from China that FCSM appeared before the DNCG appeal committee… The latter confirmed their decision to be demoted to National 1.”
“The management of FC Sochaux-Montbeliard shares the grief of all the club’s supporters and employees, and regrets the consequences of this situation.”
The club is currently working on presenting a new budget that will enable them to compete in the third tier next season. The Nenking Group, a private conglomerate based in Guangdong province, China, did not respond immediately to a request from Reuters for comment or an explanation as to why they chose not to assist the French club. There was no mention of the news about Sochaux on the group’s official website or social media accounts on Thursday.
However, the group still proudly states on its “About us” page that it acquired Sochaux in 2020 to expand its presence in European football. Sochaux, which was originally founded by Peugeot, a French automobile company, almost a century ago, has a history of success, winning the top division league title in the 1934-35 and 1937-38 seasons. They also claimed the French League Cup in 2004, with their most recent major trophy being the Coupe de France in 2007, the country’s premier knockout cup competition.
Peugeot sold the club in 2015 while they were in the second division, and since then, ownership has changed hands from Ledus to the Nenking Group, who officially acquired the club in 2020. Upon acquisition, the club’s newly-appointed Executive Director General, Samuel Laurent, stated that Nenking Group chairman Zhong Naixiong aimed to restore the club’s position as a top-tier team within “three or four years”.
Similar incidents have shaken Chinese football in recent years. In 2021, reigning Chinese Super League (CSL) champions Jiangsu Suning were abruptly informed by their owners, the Suning group, that the club would cease operations. Prior to that, Guangzhou FC, previously known as CSL heavyweights Guangzhou Evergrande, suffered greatly due to the financial troubles faced by their owners, the Chinese property giant Evergrande.