How can a ruined club spend so much money on the transfer window? This is the question that many football fans have been asking since the start of the transfer window, when FC Barcelona has already spent more than 100 million euros on Raphinha and Lewandowski, and is about to drop a new check for approximately 55 million euros to enlist Jules Koundé. Where does this money come from? How can a club on the edge of the abyss recruit so much?
Twice this summer, FC Barcelona has sold percentages of its income linked to its La Liga TV rights. That’s where all the money is coming from. First 10%, then 15% recently, to the company Sixth Street, accustomed to this type of operation, having already worked with other clubs like Real Madrid in the past. In total, the club recovered 519 million euros thanks to this double sale. Of course, not everything will be destined for the transfer window, since there are other expenses to cover, starting with the debts to be repaid, but the Laporta-Alemany duo have therefore recovered a hell of an envelope to be able to have fun without too much count his money.
Since Joan Laporta took power a year ago, the club has still managed to get rid of several undesirable players, and above all has lowered its payroll significantly. The various departures, sales and/or loans of players like Lionel Messi, Philippe Coutinho or Antoine Griezmann among others have made it possible to reduce this wage bill by more than 150 million euros in the space of just one year, and that should Continue. The objective of Barca, whose total salaries currently stand at around 550 million euros, is to approach a healthier situation like that of Real Madrid, which is running at 400 million euros. Significant savings have therefore been made, and allow the club to breathe a little better financially. Joan Laporta has also set up a maximum salary of 10 million euros per year for recruits who have arrived and those who will come later.
The strength of Barça is partly its prestige. And on the side of Chelsea we know it well, since the Barcelonans managed to afford Raphinha and will do the same for Koundé by offering less money to Leeds and Seville than what the Blues offered. The players dream of joining Catalonia and are ready to insist with their club, just as they are also ready to make efforts from a salary point of view and decline more important offers elsewhere. Robert Lewandowski, who received 12 million euros net in Munich, will only receive 9 on the Barcelona side, for example. It should also be pointed out that Mateu Alemany is a keen negotiator – a reputation he already had long before arriving at Barcelona – and he always manages to get the best deals for his clubs. What makes the difference, while during Bartomeu’s tenure, Barca used to overpay, both in transfers and wages.
It should also be noted that FC Barcelona’s recent problem has not necessarily been the lack of cash, since such a club can always find solutions to have cash available, whether by selling assets such as the case cited above, or even via agreements or loans with investment funds and financial entities. It was above all this wage bill that was of concern, particularly with regard to La Liga’s financial fair play rules, which prevented the club from registering its players easily.
Dangerous financial transactions?
FC Barcelona is not completely out of the woods. Until now, the Barcelonans were subject to the 1/4 3/4 rule of domestic financial fair play. That is to say that the leaders could only reinvest 25% of what was generated, to build the workforce. Rather strict rules that we have told you about many times on Foot Mercato, and which in a way handicaps the Spanish clubs, but on the other hand, allows them to stay in the green financially. No doubt if they had been put in place during Bartomeu’s tenure, Barca wouldn’t be where they are today. Now, thanks to the operations mentioned above, Barça is on 1/1, ie it can reinvest everything that is recovered. But no more, of course. Only, the wage bill remains too high and at the time of this writing, new signings cannot be registered with La Liga.
It will therefore be necessary to part with players, with Frenkie de Jong who is the number 1 candidate to pack his bags. Other assets could also be sold during the summer, such as the production company Barça Studios or BLM, the company which manages the merchandising of the club. However, unlike La Liga TV rights, which ultimately represent only a fairly insignificant part of Barça’s budget, these operations could be less financially attractive. Laporta’s bet this summer was clear: recover large sums this summer to invest and be competitive, even if it means sitting on potentially higher future income. Risk ? Yes and no. The income from TV rights for such a club remains relatively insignificant as explained above, since Barça receives around 150 million euros per year from La Liga. The Barcelonians will sit, each year, on 37.5 million euros, and this for 25 years. That is almost double the amount for which these rights were sold. But on a budget of around 800 million euros and which risks approaching the billion as before the covid very quickly, it is not huge. Clubs of Barca’s caliber make far more money from merchandising, ticketing and sponsorship deals than from TV revenue. “Losses” which could be compensated by good results in sport (especially in the Champions League, which is particularly profitable) and the increase in La Liga TV rights. But in this unpredictable world that is football, we are never safe. Especially since there is a colossal debt to settle and an Espai Barça to finance…