An insider close to the sovereign wealth fund PIF confirmed to the newspaper that the liabilities of the reigning Saudi champions have now climbed to more than 800 million riyals, the equivalent of just over 187 million euros.
That financial crisis, caused exclusively by poor financial decisions last season, has put the club under strict supervision from the Saudi Professional Football League. The owner has now moved to impose radical measures with immediate effect to stop the debt mountain growing any further.
Chief among them is removing the operational management's ability to act. Asked directly by Al-Riyadiah whether the club's current leadership are being prevented from agreeing new contracts for next season, the source gave a clear answer: "Yes, there will be no contract agreements as long as the management does not provide liquidity from the club's revenues."
Getty ImagesTransfer ban for Cristiano Ronaldo's club
That means the club's leadership in Riyadh cannot sign any new players until they can prove the necessary funds from their own sponsorship income or other club revenues.
PIF's restructuring plan is built on three central pillars. Alongside curbing the financial powers of the current club leadership, the fund has brought in independent financial, business and legal advisory firms.
Those firms are tasked with finding ways to increase commercial revenues, rein in spending and draw up a timed roadmap to restore financial sustainability. The third pillar centres on the ownership structure: PIF are currently assessing two serious offers to take over Cristiano Ronaldo's club, with the fund favouring a partial takeover.
Getty ImagesSovereign wealth fund PIF must not interfere in sport
According to the informant, the aim of those steps is "to preserve the club's financial, fan-related and marketing-related value, prevent the debt from doubling and strengthen compliance with the applicable governance rules".
Those rules also apply internationally, as ownership of PIF's sports companies falls under the supervision of FIFA and other associations. To guarantee fair competition between several clubs under the same owner, the sovereign wealth fund is legally required to spread its financial support evenly and must not directly interfere in sporting matters.