Famed French club Lyon has been demoted to the second division.
This decision stems from debts accumulated by their owners, Eagle Football Group.
The company is led by American businessman John Textor.
Last year`s financial reports revealed that Eagle Football Group`s debts had surged to £422 million.
Subsequently, Lyon received a provisional relegation to Ligue 2 because their financial situation had not improved.
Textor attempted to raise funds by selling players, the club`s women`s team, and his 43 percent stake in Crystal Palace for £190 million.
However, authorities determined that these actions did not restore the venerable club to sufficient financial health to prevent the provisional sanction from being imposed.
Lyon confirmed they will appeal the decision made by the DNCG, the body that oversees the finances of French football clubs.
Olympique Lyonnais acknowledges the incomprehensible decision rendered by the DNCG tonight and confirms that it will immediately file an appeal.
In recent months, we have worked closely with the DNCG, satisfying all of its requests with cash equity investments exceeding the amounts requested.
Thanks to the equity contributions of our shareholders and the sale of Crystal Palace, our cash position has improved significantly, and we have more than sufficient resources for the 2025/26 season.
With so much cash liquidity demonstrated, and sporting success which has earned European competition in two consecutive years, we sincerely do not understand how one administrative decision could relegate such a great French club.
Through our appeal, we will establish our substantial cash resources as necessary for Olympique Lyonnais to keep its place in Ligue 1.
If the appeal is unsuccessful, Reims, who were defeated by Metz in the relegation playoff, would reportedly take their place in the top flight.
Last year, Textor stated there was “no chance” of Lyon being demoted.
The billionaire also owns Brazilian club Botafogo and Belgian side RWD Molenbeek.
The sale of his stake in Palace to New York Jets owner Woody Johnson requires ratification by the Premier League via the owners` and directors` test.
Crystal Palace`s spot in next season`s Europa League has been threatened because Lyon also qualified for the competition.
Textor`s influence over both clubs could violate UEFA`s ownership regulations, with a decision anticipated on Friday.
Officials from Crystal Palace have been meeting with the governing body in an effort to avoid being removed from the Europa League.
Lyon`s relegation could affect their participation in European competition next season.
They might have points deducted, meaning their sixth-place finish in Ligue 1 would no longer be valid.
However, if they are simply expelled from the division, their finish from last season could potentially stand, as would their qualification for Europe.
UEFA regulations stipulate that if two clubs are found to have the same owners, the team with the higher league position is given priority to compete.
Lyon is one of France`s major clubs, having won the league title seven times.
They reached the Champions League semi-finals as recently as 2020, and their last stint in the second tier was in 1989.
Their relegation could trigger the sale of many highly-rated players, such as winger Malick Fofana, who has been linked with Liverpool and Chelsea.
