The auditor of Brera Holdings, an Irish-based company set up in 2022 to hold an Italian soccer club with “mixed” results, has highlighted risks over the business’s ability to continue to operate as a going concern after suffering recurring losses.
However, the company, which floated on the Nasdaq 18 months ago, said in its 2023 annual report it is looking at a number of avenues to raise funds – including through public offerings, private equity and debt financing.
In the meantime, its executive chairman, Daniel Joseph McGorry, an investment banker with US-based Boustead Securities, has indicated “his intention to fund the company as needed for the foreseeable future to the extent that revenues from existing operations or alternative funding is not available”.
The board has therefore concluded Brera will have sufficient working capital for at least the next 12 months, which has allowed directors to prepare the accounts as a going concern.
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Still, the company’s auditor, TAAD, highlighted that the losses accumulated by the company “raise substantial doubt about its ability to continue as a going concern”.
Brera’s net loss widened to €4.91 million last year from €1.23 million in 2022, the year it was established.
Brera missed a deadline under US stock market rules to file its annual report – or so-called 20-F report – at the end of April, four months after the end of its financial year. It committed to submitting the report by last Monday to regain compliance with the Nasdaq. The publication comes four days later than that.
Shares in Brera have slumped 86 per cent since it floated in late January 2023. It currently has a market value of $7.7 million (€7.1 million).
The company, registered in Ireland for tax purposes with an address on Burlington Road in Dublin 4, controls Milan’s Brera FC.
Brera FC, the so-called “third team of Milan” after Inter Milan and AC Milan, has been in existence since 2000. Brera Holdings was set up in Dublin in June 2022 to hold the “cult club” as it went about raising money in an initial public offering (IPO) to expand by acquiring and developing a portfolio of football clubs in emerging markets including eastern Europe, Africa and South America.
Brera expanded to Africa in March last year with the establishment of Brera Tchumene, a team admitted to the second-division league in Mozambique, before acquiring 90 per cent of North Macedonian first league club FK Akademija Pandev a month later.
In June 2023, Brera acquired a small “strategic stake” in Manchester United, making what it claimed was a 74 per cent gain at the end of the year as it tendered all of its shares as UK billionaire Jim Ratcliffe made an offer for a minority stake in the club.
Brera also acquired control of Italian Serie A1 women’s professional volleyball team UYBA Volley 12 months ago.
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