French giants Lyon have been relegated to Ligue 2 following a decision by French football’s financial watchdog, the DNCG, after failing to demonstrate improvements in their financial health.
The seven-time French champions were provisionally demoted in November by the DNCG, the body that oversees club finances in France, but were given a chance to overturn the ruling in a meeting on Tuesday.
However, despite presenting their case, Lyon officials, including majority owner John Textor, failed to convince the commission.
In a strongly worded statement, the club described the decision as “incomprehensible” and confirmed it would appeal to retain its top-flight status.
“With proven funds and sporting success that has earned us a place in European competition for two consecutive years, we sincerely do not understand how an administrative decision could relegate such a major French club,” the statement read.
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“We will appeal to demonstrate our ability to provide the necessary financial resources to guarantee OL’s place in Ligue 1.”
Financial trouble and ownership links
Lyon’s financial woes have been long documented. Last October, Eagle Football Group Textor’s multi-club ownership vehicle, which holds a 77% stake in the club, reported debts of £422m.
31 Nemanja MATIC – 10 Alexandre LACAZETTE during the Ligue 1 match between Lyon and Rennes. Photo by Getty Images
In attempts to stabilise the club’s finances, Lyon sold midfielder Maxence Caqueret to Italian side Como in January and highly rated attacker Rayan Cherki to Manchester City earlier this month, raising around £45m.
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High earners Alexandre Lacazette and Anthony Lopes were also let go as part of sweeping cost-cutting measures.
Despite these efforts, the DNCG ruled that Lyon had not sufficiently improved their financial position to justify remaining in Ligue 1.
Implications for Crystal Palace and European football
The ruling may also have consequences beyond French football. Textor recently agreed to sell his 43% stake in Premier League side Crystal Palace to resolve a potential conflict with UEFA regulations regarding multi-club ownership.
Olympique Lyonnais football club President John Textor is surrounded by supporters after his team won the French Cup semi-final match against Valenciennes FC. Photo by Getty Images
Lyon’s participation in European competition and its impact on Palace’s potential Europa League berth remain uncertain, with UEFA rules barring multiple clubs under the same ownership structure from competing in the same tournament.
What happens next?
Lyon has confirmed they will appeal the ruling. Should the demotion be upheld, Ligue 1 will reinstate Stade de Reims, who lost their relegation play-off to Metz at the end of last season.
If confirmed, the drop to Ligue 2 would mark a significant fall from grace for one of France’s most storied clubs, which dominated the league in the early 2000s and were in the Champions League semi-finals as recently as 2020.
