Carlisle United's close financial ties to Edinburgh Woollen Mill are back under the spotlight as Philip Day's company prepare to call in administrators.

The shock news, which puts around 24,000 jobs at risk across EWM's retail empire, could also have implications for the Blues.

United owe £2.1m to EWM after Day's firm set up a "loan facility" to the Brunton Park club in 2017.

That debt is secured against United's assets, and is subject to personal guarantees by the club's owners.

Carlisle have today declined to comment on any potential ramifications of the news of EWM's notice of intention to appoint administrators.

Their supporters' trust CUOSC, who own 25.4 per cent of United's holding company, say they are talking to the club's owners about the situation.

In a statement CUOSC said: "CUOSC are aware of the reports concerning EWM.

"We know nothing more than what has been reported by news outlets. We are in contact with the other owners of the football club.

"We are actively pursuing further information and will comment when we know more." 

The news has inevitably raised concerns among fans given the close links between United and Day's firm.

Carlisle-based EWM have been long-standing sponsors of United but stepped up their involvement in 2017 when they came to the club's financial aid with loans.

They have played an influential part in a change of financial approach at the club since then with Carlisle reducing their spending.

EWM's group financial controller John Jackson is a director of CUFC Holdings while EWM have also provided ring-fenced funding for the appointment of a the club's director of football - David Holdsworth, who is also close to Day.

The firm's billionaire boss Day was at Brunton Park only last month in a rare appearance at the ground to watch Carlisle's EFL Trophy game against Fleetwood.

Last week Blues co-owner John Nixon insisted "no news was good news" regarding the impact of Covid-19 on EWM's involvement in potential ownership "succession" at the top of United.

The club have not drawn on the loan facility for the last 12 months. Nixon also said: "EWM have been good to us, they’ve invested money when we needed it three or four years ago and they’ve been there ever since. If anything was to change on that I’ve got an assurance and I fully trust them that we would get to hear of anything that might have an effect on us first so we can be prepared."

In February Nixon said he and his fellow owners had "run out of cash" and were hoping EWM would take a share of the club. There was speculation that a new firm set up by Day in 2019, called Eden Valley Sport Ltd, could be connected with such moves. There has been little sign of any business activity by that company since then.

EWM, who are working with insolvency specialists FRP to carry out a review of the group, have written to the group's staff to warn them that the Covid-19 climate had taken its toll on sales.

Chief executive Steve Simpson said the past seven months had been "extremely difficult".

He also cited the effect of what he described as "false rumours" - strongly denied - about unpaid bills connected to suppliers in Bangladesh.

Simpson said such rumours had impacted EWM's credit insurance and this, along with the Covid lockdowns, had "made normal rading impossible".

“As directors, we have a duty to the business, our staff, our customers and our creditors to find the very best solution in this brutal environment," he added.

“We have applied to court today for a short breathing space to assess our options before moving to appoint administrators.

“Through this process I hope and believe we will be able to secure the best future for our businesses, but there will inevitably be significant cuts and closures as we work our way through this.

“I would like to thank all our staff for their amazing efforts during this time and also our customers who have remained so loyal and committed to our brands.”

An FRP spokesman said: “Our team is working with the directors of a number of the Edinburgh Woollen Mill Group subsidiaries to explore all options for the future of its retail brands Edinburgh Woollen Mill, Jaeger, Ponden Home, and Peacocks.”

At the end of this process, EWM are expected to appoint FRP Advisory as administrators who will carry out restructuring of the wider business.

The News & Star is seeking further comment from EWM and FRP about any potential implications for United. Strategic advisors Maitland, who are working with EWM, declined to comment today, saying it was too early in the process to do so.