Pompey this afternoon formally applied to go into administration.
The club made the application to the High Court in light of its continuing financial crisis.
It is believed that the process will be formalised by the court on Friday, after the home match against Ipswich Town tomorrow night.
Creditors include electricity suppliers have threatened to cut the club off, Peter Kubik, of UHY Hacker Young, administrators for Pompey’s parent company CSI, said in an interview with the financial news service Bloomberg.
‘During the last week it’s been very difficult to trade,’ said Mr Kubik. ‘Administration would allow us to get the bank account unfrozen and pay the electricity board, who’ve constantly been threatening to cut us off.’
A move into administration for the second time in two years would almost certainly trigger a 10-point penalty, plunging the team to the edge of the Championship relegation zone.
Sources at Fratton Park say that the match there tomorrow is not in danger as a result of the latest developments and that suppliers have agreed to provide their services as usual.
Stewards this afternoon received a text message from the club saying: ‘Tomorrow’s match against Ipswich will go ahead without fail. Your attendance is essential to make this happen.’
The decision to place Pompey into administration is likely to lie with the club’s debenture holder - Portpin, which is the firm of former owner Balram Chainrai.
Financial experts say Mr Chainrai would appoint an administrator by filing a notice, probably at the High Court.
Placing the club into administration would stop HMRC’s winding-up petition over £800,000 unpaid tax, although the club now owes around £2m to the revenue.
Administration would not automatically unfreeze the club’s bank account, but money in them would be available to the administrator as an ‘asset’, which could be used to pay wages.
Pompey will be able to continue to play football and trade as long as the administrator has the funds available to pay its ongoing costs.
Administration would stop the threat of liquidation but the administrator has to find a buyer within a year.
If the company can no longer afford to trade, or a sale is unlikely to cover running costs, it can be liquidated.
There are several ways to exit administration, two of them being a Company Voluntary Agreement (CVA) – often following a sale to a new owner – or through liquidation.
Pompey said in a statement this afternoon: ‘Portsmouth Football Club today made an application to the High Court to go into administration.
‘The club will not enter administration until the court endorses the application and appoints an administrator.
‘The High Court hearing is due to take place on Friday, February 17.’
Chief executive David Lampitt has confirmed the club has made an application for UHY Hacker Young to be administrators of Pompey.