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The Associated Press February 26, 2010, 7:18AM ET

Arsenal cuts overall debt by almost 40 percent

Arsenal has cut its debt by almost 40 percent to 203.6 million pounds ($311. 6 million) through selling more of the apartments it built on the site of its former stadium.

Buoyed by the sale of another 261 units in the Highbury Square property development, the north London club said Friday that it made a pretax profit of 35.2 million pounds ($53.8 million) for the six months ending Nov. 30.

It cut its debt from 332.8 million pounds ($537.5 million) the previous May to maintain its reputation as one of the more financially stable clubs in the Premier League.

Chief executive Ivan Gazidis said the profit was less important than the reduction in debt.

"It's important to note that this isn't our primary objective," Gazidis said. "The reason we run a responsible, profitable and self-sustaining business is so that we can deliver success to the club and invest in the club and ultimately deliver success on the pitch, something that our fans can be proud of."

But Arsenal's success in this aspect could threaten its independence.

Denver-based businessman Stan Kroenke is close to reaching the share threshold required to launch a takeover bid for Arsenal, while Russian billionaire Alisher Usmanov is also rumored to be interested in the club.

The club left Highbury, its home of 93 years, in 2006 and moved to the new Emirates Stadium nearby.

The increase in stadium capacity from 38,000 to 60,000 generates more than 1 million pounds ($1.52 million) extra income for each home game, while the decision to build homes in a stadium-style development seems to have paid off despite the unpredictability of the property market during Britain's economic downturn.

Arsenal now has just 13 million pounds ($19.8 million) of a 137 million-pound ($208.6 million) construction loan left outstanding.

Arsenal has sold 524 of the 655 Highbury Square apartments and non-executive chairman Peter Hill-Wood said "the next couple of years will see our property activities delivering surplus cash."

"I would not want to speculate on the exact quantum or timing of this," Hill-Wood said. "How we will use this surplus remains undecided but, in addition to investing in the team, I think we will examine investment in club projects and infrastructure both in and around Emirates Stadium."

Manager Arsene Wenger has so far refrained for the most part from spending big money on high-profile players, but the availability of cash could give his club an edge in the market over top-four Premier League rivals Manchester United and Liverpool.

United and Liverpool are both heavily indebted following leveraged takeovers by American owners.

Liverpool manager Rafa Benitez has bemoaned his inability to spend heavily on players, while United has spent little of the world-record 80 million pounds ($131 million) it received from Real Madrid for Cristiano Ronaldo in July.

"Arsenal's debt position is very healthy," Gazidis said. "I think it's important that clubs act responsibly with respect to debt. The important things that everybody needs to ask are, 'is the debt affordable, can the repayments be met?'

"And provided clubs act responsibly, then it's not true to say all debt is bad."

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