Why was Ligue 1 Club Lyon relegated? | Explained

Olympique Lyonnais has been relegated to Ligue 2, said the financial watchdog of French football (DNCG) on Tuesday after an audit from the club, who said it would immediately appeal against the decision.

Lyon was provisionally degraded by the DNCG in November because of the poor condition of their finances and the decision was confirmed on Tuesday after a meeting between club owner John Textor and the DNCG.

The club criticized the decision in a statement on Tuesday and said it had worked closely with the DNCG and satisfied all their requests.

«Olympique Lyonnais takes note of the incomprehensible decision that was taken over by the DNCG tonight and confirms that it will appeal immediately,» the club said.

«With demonstrated funds and sporting success that has given us a place in European competition, we sincerely understand how an administrative decision could relegate such a great French club.»

The decision to relegate Lyon comes a day after the American businessman Textor had sold a 43% interest in Crystal Palace in English club.

«Thanks to the share contributions of our shareholders and the sale of Crystal Palace, our cash position has improved considerably and we have more than sufficient resources for the 2025/26 season,» added the Lyon statement.

In October the Eagle Football Group of Textor unveiled debts of a total of around 422 million pounds ($ 574.85 million), which resulted in concern about the financial stability of the French club.

Since then, Lyon has raised money by discharging different players, including Maxence Caqueret to Como and Rayan Cherki to Manchester City.

However, the club has not been able to convince the authorities that its financial situation has improved sufficiently to lift the sanctions.

The 59-year-old Textor gave a positive assessment of their financial position before the decision was announced.

«You can see by the contributions of our shareholders, we have invested new capital, not only for the DNCG, but also for our UEFA License process. Not to mention the good news of the sale of Crystal Palace. Our liquidity situation has been considerably improved,» he said reporters earlier on Tuesday.

Lyon, who was crowned with French champions seven times between 2002 and 2008, qualified for the Europa League of next season after a sixth placed finish in Ligue 1.

If the decision stands, Stade de Reims, which was relegated from Ligue 1 in the relegation play -offs after losing Metz, will the following season of Lyon in the French top layer.

Neither Reims nor the administrative body of French football (LFP) was immediately available for comment.