Bankruptcy proceedings begin
MILAN — Prosecutors in Florence opened bankruptcy proceedings Wednesday on the soccer club owned by cash-strapped movie magnate Vittorio Cecchi Gori, who has vowed to sell it.
Fiorentina will be managed by a trustee (similar to one in a Chapter 11 situation) until the end of the season. Despite selling players to raise cash, the club was forced to declare bankruptcy after it failed to come up with unpaid taxes by the court deadline set in July.
Most Italian soccer clubs are in financial trouble because income from broadcasting rights has not covered the huge amounts spent on players. But Fiorentina was particularly hard hit after Cecchi Gori borrowed $35 million from the club to finance his film company, Finmavi, and never paid it back.