Carlisle United are on the brink of being debt free, the club's American owners have confirmed today.

The Piatak family said the £2.4m legacy debt to Purepay Retail Limited, which the Piataks bought when taking over the Blues, is close to being removed from United's balance sheet.

The positive update on the financial situation was provided by director Tom Piatak II in an official club interview.

Four months after the News & Star revealed that the Piataks had bought the debt as part of the takeover process, financial discussions have taken place which will see the matter resolved.

“As fans already know, Castle Sports [the Piatak company used as the takeover vehicle] did purchase the debt of over £2.4 million, in full, from Purepay,” Tom II said in a club interview today.

“In the past week or so, we’ve managed to get with the accountants and find a way to get that forgiven, so it will not be affecting the club.

“That was one of the big things we stated when we came in. We wanted to be debt free, we’ve made the commitment to be debt free and we’re close to getting that done." 

United's chief executive Nigel Clibbens added that steps "to forgive and waive the intercompany debt due from the club to Castle Sports Group" have been agreed and will "be affected in 2023/24, this financial year."

Clibbens confirmed that the Piataks had paid £2.45m for the debt - which had a "nominal discount" from Purepay of £189,000.

This was against the total capital value of £2.1m and over £500,000 of interest. The debt was a legacy of loans from Philip Day's Edinburgh Woollen Mill before it was novated - transferred - to a new company with links to Day, Purepay, after EWM went into administration.

The debt had been secured against club assets, and had been subject to personal guarantees from United's former owners.

“This debt forgiveness releases the club from the £2.45m debt now due to CSG and makes the club debt free apart from the unsecured and interest free, legacy Pioneer debt which is being cleared over a five-year period, in a deal we agreed before the takeover last year," added Clibbens.

"It will also give rise to a significant exceptional income gain in 23/24 which will benefit the financial results for the year. Then finally, with no other debt apart from to Pioneer, all the club assets will then be free from security once again too.

"All of this is brilliant news for the club. The approach of the Piataks to dealing with this has been fantastic."