Why did legendary French club Olympique Lyon get relegated to Ligue 2?

French soccer were delivered a huge blow as legendary French club Olympique Lyon got suddenly relegated to Ligue 2, a decision that raised eyebrows among fans.

Olympique Lyon’s financial situation had been under close scrutiny by the Direction Nationale du Contrôle de Gestion (DNCG), France’s financial watchdog for professional soccer. On Tuesday, the organization made its ruling, relegating the storied French club from Ligue 1 to Ligue 2.

The club, owned by American investor John Textor, has been under the microscope in recent years, with unpaid salaries among the biggest concerns raised by players and league officials. After an initial provisional relegation decision last November, the DNCG has now confirmed Lyon’s drop to France’s second division.

Why were Lyon relegated?

On the field, Lyon finished the 2024-25 season in sixth place with 57 points from 34 matches, earning a spot in European competition for next season. But off the field, financial troubles overshadowed the club’s performance.

The DNCG initially imposed a provisional relegation during the winter after Lyon failed to provide sufficient financial guarantees. With a reported debt of €175 million, the club faced the real possibility of a permanent sanction being upheld. In the days leading up to the DNCG’s final decision, Textor, who also owns Botafogo and was present in the US for the FIFA Club World Cup 2025, attempted to downplay the situation.

“We have made several investments in recent weeks. Everything is financially sound,” Textor told L’Équipe after Botafogo’s win over PSG, trying to calm concerns. However, the ruling body found the situation more serious than Textor suggested, resulting in the confirmed relegation.

With the risk long looming throughout the season, Lyon have now been handed an administrative relegation to Ligue 2. However, the club still has the option to appeal the decision and fight to retain their place in France’s top flight.