Skip to main content

Champions League exit is blow for Barca

Barcelona are out of the Champions League at the group stage for the second season in a row.  This was not supposed to be happening after Barcelona’s eventful summer 2022, with the noise of a series of financial levers being pulled and the excitement generated by new signings such as Robert Lewandowski. That was all designed to make sure the club were ready for big nights like this with a rebuilt team that could again compete for the top trophies.

A realistic summation of Barcelona’s finances came when the club’s financial vice-president Eduard Romeu admitted last week that “without the income from the “levers”, last year we would have lost €106million, and this year (the loss would be) €210million”.

Most obviously, their squad still costs way more than it should. In 2021-22, the total spent on salaries and amortised transfer fees was €518million but the budget confirms that, in 2022-23, it is up by 27 per cent to €656million after the signings of Lewandowski, Raphinha and five more new players in the summer.

Beyond the numbers, making the Champions League knockout phase is also vital to the club’s image.  Momentum is crucial to growing their fanbase and increasing their revenues from commercial partners. 

The board already have permission from socios to sell a 49 per cent stake in the club’s BLM (Barca Licensing & Merchandising) arm, although they have not yet been able to find a suitable partner willing to pay what they want. “We are looking for an industry partner but we have said we will not do any operation for less than €300million,” Romeu said.

Another potential option would be selling a share in the club’s museum, which is among the most visited tourist attractions in the Catalan capital.  Laporta’s ally Roures has already suggested he might be interested in paying up front for a stake in the its future revenues. But this is complicated by the huge renovation project at Camp Nou, which will require the museum to close for a significant amount of time over the next couple of years.

The rebuild has also added to Barcelona’s liabilities, with €1.5billion to be repaid over 25 years once the new-look stadium is completed.  In the short term, it will cost them €50million next season as construction work means the first team must play at the city’s smaller (55,000 seats) and less modern Montjuic Stadium.

The whole point of pulling all those financial levers and gambling by borrowing from their future was to make sure it could not happen again. “Virtuous circles” of the type Laporta is aiming for are not set in motion by playing in the Europa League.

With Laporta having committed to the policy of using short-term fixes to jump-start the team, more lever pulling looks almost certain now.  Whether that is really good for the club long term or not is moot. Barcelona are in too far to pull out now. 

 

 

Labels:

Comments

Post a Comment

Popular posts from this blog

Threat of financial calamity removed from Baggies

West Bromwich Albion had effectively been in decline ever since the club was sold to a Chinese consortium in August 2016, paying a figure north of £200m to buy former owner Jeremy Peace’s stake. Controlling shareholder Guochuan Lai’s ownership was fairly disastrous for the club, but his unloved tenure finally came to an end after Bilkul Football WBA, a company ultimately owned by Florida-based entrepreneur Shilen Patel and his father Dr Kiran Patel, acquired an 87.8% shareholding in West Bromwich Albion Group Limited, the parent company of West Bromwich Albion Football Club. This change in ownership was urgently required, due to the numerous financial problems facing West Brom, including growing high-interest debt and serious cash flow concerns, following years of no investment from the former owner. Indeed, West Brom’s auditors had already rung the alarm bell in the 2021/22 accounts when they cast doubt on the club’s ability to continue as a going concern without making player s...
1 comment
Read more

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000.  The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts.  Money brought in from football has gone up too. Match day ...
Post a Comment
Read more

Spurs to sell minority stake

Tottenham Hotspur is in talks to sell a minority stake in a deal that could value it at up to £3.75 billion and pave the way for Joe Lewis and his family to sever ties with the Premier League football club. Tottenham chairman Daniel Levy is seeking an investment that values the club at between £3.5 billion and £3.75 billion, including debt. While the terms of any deal have not been finalised, City sources expect Spurs to sell about 10 per cent. The club is being advised by bankers from Rothschild on the sale. Tottenham wants to raise fresh capital for new player signings and to help fund the development of an academy for its women’s team, as well as a 30-storey hotel next to its north London stadium. The financier Amanda Staveley, who brokered the deal for Saudi Arabia’s Public Investment Fund to take over Newcastle United, is understood to be among the parties to have expressed an interest in Tottenham. Staveley’s fund, PCP Capital Partners, has raised about £500 million to ...
Post a Comment
Read more