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Arsenal move up and are now third in the rich list

Manchester U are regularly seen as the richest club in the world.  This, despite their debts, is once again the feeling of Forbes 2011 Soccer Valuation, in its latest survey.

Manchester U have been number one on the Forbes list for seven years running, which is rather dull, and is now valued at something like £1.13 billion.

Second in the list (again, again, oh how boring) is Real Madrid, followed by a surprise new entry in the top three.  Arsenal.

Bayern Munich are fourth and Bar Bar Black Sheep are fifth.

So what do we make of these funny lists of richness?  Forbes say their lists places a value on teams based on what they have been sold for in the past relative to sales and profits, broadcast agreements and debt from new or pending stadium deals.   Which is quite a complex formula and can hide a multiplicity of sins.

What we all know is that Manchester U are saddled with a huge debt of their own, and are the single source of income for the Glazer family who are attempting to prop up the rest of their failing business empire with money from Manchester.

Real Madrid are murkier, given their close relationship to the banks, and I doubt that anyone outside the finance minister of Spain and a couple of fixers in the banks, really knows what the hell is going on.  (Mind you that is also true of the Spanish economy as a whole – minus of course the bit about Elena Salgado who is the minister of Economy and Commerce in the country).

But certainly Real Mad do come up with funny stories – like the one about financing a big transfer just on the sale of shirts.   As we pointed out at the time on this site you have to sell shirts with one player’s name on to most of Africa if you want to pay for his transfer that way.  Sadly the media didn’t do this simple calculation themselves and mostly bought the story.

And then we are third – a huge leap up over the years.  But it is important to beware – there are other rich lists around, some of which measure profit, some of which measure assets, some of which measure turnover.  We are in different positions in each one.

Back in 2007 Arsenal were hailed in one report as the country’s richest football club because of operating profits of £51.2m and turnovers way above those of Chelsea and Manchester U and not far off Real Madrid.

The real issue always is, is the club viable, and can it keep going.  For Manchester U the answer is yes, as long as the fans keep turning up, the club keep doing well, and the Glazers don’t need to take more money out than now (which is a danger).

As for Real Mad, who knows.  Their finances do seem to be based on the notions of a semi-crazed hedgehog but if the state is there to prop them up, presumably they keep going.   For Chelsea and Man City the answer is down to one man.  Not the case with us, since although the majority of shares is held by one man, the club is independently profitable, and he’s not taking anything out of the club (although of course he might – but this is not a piece about futurology).

Our finances are based on profit – real profit – which should keep going ok.   It is interesting that I’ve just see the return big time of the “all the season ticket holders are leaving” story of last year.  This year it also has a twist in that it claims that unprecedented numbers of season tickets were available last year too, and that next season it will be a case of take whatever ticket you want, if you want to go to a game.  I guess we’ll have to run that analysis again, to prove the point (or otherwise).

But for now, according to the odd model Forbes uses, we are the third richest club in the world.  Not bad for the club that the Tiny Totts refer to as “the little club from south London”.

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33 comments to Arsenal move up and are now third in the rich list

  • Richard B

    Surely the old adage that turnover is vanity, revenue is reality and cash flow provides sanity must kick in here somewhere?
    The problem with assessing the size of a clubs assets is mainly that they are players whose ‘value’ on the market could be extremely variable depending, amongst other things, on who is buying.
    The reason for the existance of debt is also key. Borrowing money to buy/pay players must be more risky than debt raised to invest in facilities that will be useful for decades to come. The financial shake up driven by the recession and by Financial Fair Play should clarify some aspects of ‘wealth’ over the next few years – as may the taxman’s increasing interest in ensuring that clubs are more transparent in their ownership arrangements.

  • walter

    So if you take the accounts in a whole in the top 5 only two clubs are running on a profit: Arsenal and Bayern Munich. Well I think Bayern Munich is making some profit as the financial rules in Germany are more strict than in most other countries.
    Like you say even if we have one shareholder with some +60% of the shares he isn’t completely on his own to do bad things for his own profit. Not that Kroenke has a habbit of doing bad things in the clubs he owns.

    About the season tickets: maybe we should hope it is true. Maybe the plastic fans will leave and so create more space fcr the supporters. The real supporters. the ones that will support their team and not just sit their on their bum waiting for the first misplaced pass so they can start moaning about the players, the team, the manager….

  • old timer

    Walter I do so hope you are right and the plastic fans will P.O.. some of the crap sprouted on some of the blogs beggars belief.

  • jaymin

    evil chelsea, city, and united will all be slain by the incorruptible UEFA, who will certainly exhibit uncommon bravery vs. Real Madrid, Barcelona, Manchester United, etc. in insisting on enforcement of “fair play.” Likely! Kroenke way better than Usmanov : )

  • Mandy Dodd

    “Third richest in the world but cannot stretch to a decent GK,/ CD / MF, medical team / kit man or whatever” – not my thoughts, just stealing the thunder of any trolls who will undoubtably have something to say on this.

  • Gooner80

    Some people are going to say Wenger should get his cheque book out and spend some money since we are so rich, But when I think about the signings other clubs have made it is rare that any £30 million plus player has been value for money and many have been big money flops. Everyone has been whipped up into a frenzy of short termism

    I feel pleased that Arsenal are in good shape many clubs are run like Ponzi schemes and are just waiting to fail when the bottom rungs fall out

  • Gooner80

    Ha @ Mandy Dodd my sentiments exactly

  • madiora

    if the goons were not trophyless for all these years, they would have probably been the richest on the planet

  • merakis

    Enough of the meaningless stats. What matters is where are are we now and what does the immediate and longer term future hold for AFC. Not surprisingly there is almost unanimity on this board that Wenger has made errors in judgement (players and tactics) and that this current squad if not supplemented with EPL ready players does not have the qualities needed to win anything meaningful. That may not matter to you if you are happy with top four finishes but if Wenger stands pat then that goal will be more difficult next year. What is frustrating to many of us is his failure to address the obvious; our defensive weaknesses at set plays (Sunday was a prime example), the quality of the squad – Fergie probably makes more bad buys than Wenger but if they don’t meet the standard then they will be moved on, our LACK of mental strength (no leaders). Unless he opens up and tells us how he really feels th

  • merakis

    So if the reports are right, then the club will let Cesc go this summer. This shows how blind Wenger has been in thinking his ‘project’ could ever work. Lack of success means players will leave and not stay on, making the whole process useless as it’ll always be ‘back to the drawing board’ when they go. Wenger has lost Flamini, Hleb and Adebayor, all players he didnt want to leave, through lack of silverware, and despite what people think about Ade, he was world class and wouldn’t have been so disruptive if we were winning stuff. And why sell Diarra? Cesc’s summer antics when he refused to defuse the Barca rumours were worse for team morale than anything Diarra did. I’m not defending what ****s Adebayor and Diarra were, but surely Wenger could have sorted them out if it was of benefit to the club. A lot of what Wenger has done over the last few years hasn’t made sense, and the results of his failures have been obvious to almost everyone. Thats why I feel Wenger cannot take the club forwards anymore and has to go.

  • merakis

    I seriously believe it doesnt matter if Wenger bought Vidic, Messi and Ronaldo whoever we will still not win anything cos Wenger cannot motivate and plan tactics for winning big games. I know he will still be here next season and maybe the one after cos the board is inept and too scared to challenge him. Next season Manure, Chavs, Citeh and I believe a resurgent Lpool will make life very difficult for us to claim our usual top 4 slot. The rot will set in. Wenger has no intention of changing this summer and in fact can’t change. He has not won anything since the last remanants of the Graham era left the squad. He got rid of all the good experienced players in one fell swoop but is prepared to waste good money on cretins like Diaby, Eboue and Denilson, Silvestre etc. Compare that to Manure who still have Giggs (37yrs old), Scholes and Neville. SAF knows the value of experience and Wenger the price of failure! The problem is Wenger, he doesn’t seem to know how to motivate his players. He is tactical inept and has lost the dressing room. If Alex Ferguson, Mourhino or even David Moyes was in charge with the same squad for the Carling Cup final against Birmingham….you can bet your life on it, we would have won that Cup. One thing that does my head in is that, he keeps on using the 4-5-1 formation when it’s not effective with the players we ve’ got. How about usin a 4-4-2 or 3-5-2? And also, he keeps on playing players out of their natural positions e.g Walcott is a Stiker not a winger, Bendtner is a striker not a winger, Arshavin is a forward not winger, Nasri is an central midfielder/AMC not a winger. To get the best out of this players, you have to play them at their natuaral positions.

  • fhint

    @Walter this is a great forum and although more pro than anti- Wenger, is still a great read and very balanced in its views. You make very good points about our wage bill being on a par with United and Chelsea, but that the latter clubs’ players have earned their money whilst ours haven’t. It asks who will buy Denilson when he’s on £60k a week.If you then include other failures and mediocrities such as Eboue, Almunia, Diaby and Rosicky who one presumes are all on around £2-3m each, it’s no surprise none of them want to leave.Additionally, who will buy them anyway at such extortionate wages? As I suggested some time ago, debating who will come and go is pointless, even if Wenger finally wakes up after slumbering for four years and admits that maybe this team is not good enough to win trophies.Two or three signings here or there will make no difference. There is a collective malaise that afflicts us every season when there are medals to be secured. For some time now, people here have said we “challenge every season”- well we don’t actually. We do until March and then when we play decent teams, or anyone who decides to have a go, we collapse and then as in 2008, 2010 and this, we collapse. Why is this- does the Stadium refinancing suddenly then affect us, does the lack of big signings then hold us back, as others on here suggest? No, the reason we cannot respond, as Arseblog states, is because who is going to put their necks on the line, when mediocrity will still be rewarded? The mnager saying we are “winners, have mental strength, the best squad ever” etc can only breed complacency. How many players in this team really want to win and look gutted when they don’t? Three or four, the rest will probably have forgotten about it by the following week.Wenger then cannot change things because our reserves are not good enough even if they are averaging £50k a week in wages

  • Mandy Dodd

    I know he will still be here next season and maybe the one after cos the board is inept and too scared to challenge him – does this really apply to Stan Kroenke – inept and scared to challenge where required?

    Wenger cannot motivate and plan tactics for winning big games – Barca at home? – Invincibles?

    has lost the dressing room – Proof or even evidence please?

    So if the reports are right, then the club will let Cesc go this summer – significantly, these reports are in The Sun – we all know what that means

    To get the best out of this players, you have to play them at their natuaral positions – he seemed to do ok changing Henrys position
    Ade – world class – please…he has his strengths but is just a silly immature boy who disrupts teams. Diarra – hasnt really set the world alight before or after Arsenal.
    Why no mention in your analysis of the financial issues the club has been under for paying off a stadium?
    Why no mention of the proof this site has come up with about the poor / biased standard of officiating we constantly face, especially when compared to Utd.

    Yawn– I could go on and on but too nice a day…..

  • firstly lm proud to be ab ARSENAL supporter and the boost that we got to b the 3rd highest means that we have a door opened for us to make use of the moneyand buy more experienced players that will get us going ouir squad is good but we need more experienced players to boost the squad

  • Arsenal will come Tops next season.I need to chat with Arsenal fans, follow me on (keny-82)on twitter.

  • Mike

    Lets be honest here, United’s operating profits are over £100m a year. United are also a year away from securing a monstrous new Nike deal worth a staggering £450 over 13 years. That is £35m every season. Add that to the streaming deals United are securing which are estimated to bring in anything from £20-40m extra every season.

    Lets be truthful regarding Arsenal’s income. Without the board charging scandalous amounts for season tickets, Arsenal’s revenue would be very low. Of course you pay a premium in London compare to Manchester, but with United charging £931 for their best seats compared to Arsenal’s £2000 you have to ask who are ripping who off? The Glazers or Arsenal FC.

  • Arsenal’s new American owner should invest some of the big money in the summer transfers. Keeping good players is also a priority. In the end, what is the use of being the third richest club in the world if you are without a single trophy by the end of the season?

  • Shard

    I’m sorry about commenting off topic.. But WTF is this protest I’m hearing about? Seriously, how screwed up are some ‘fans’? I’m feeling so angry I can’t even find words for it.. They are trying to make our club and it’s fans into a joke.

  • Mike

    Also United maybe £497m in debt, but they do have £135m in the bank, this money is mainly the Ronaldo money & £35m of the advanced Aon money. So arguably you could say that United’s overall net debt is £362m. Not bad seems this time last year everyone thought United were nearly £800m in debt.

    Lets not forget that Arsenal have debts too.

  • Alek

    @merakis

    Compare that to Manure who still have Giggs (37yrs old), Scholes and Neville.

    Neville retired)))

  • Mandy Dodd

    Dont think half of them even know what they are protesting about Shard – seems too many and varied issues,the situation very well described in this mornings Arseblog.
    As for our fans, while we will never have as many plastics as Utd, Spurs or the Chavs, you do have to wonder about some of them and their motives!

  • Shard

    @Mandy Dodd

    How many are even there? I doubt it’s many, but the fear for me is that people just might go. It’s far easier to mobilise people for something negative. Something to protest. Rather than FOR something. In my view, most of what they are saying is nonsense, and all they are ‘protesting’ is about not winning a trophy. If we’d won the league this year, would they still be protesting about the board, or the commercial deals (seriously what??). And the statement regarding PHW is just wrong. He never called the Arsenal fans silly. It’s just self righteous nonsense. How can he, the big bad bully, call us wee little people names and get away with it?

  • Mandy Dodd

    Agree with everything you say there Shard.
    If anyone wants to know the protest points, N5 SUMS THEM UP

    http://viewfromn5.blogspot.com/2011/04/protests-what-do-black-scarf-really.html

    Very silly

  • Shard

    That’s a good article from N5 but.. ‘If the press coverage is unkind, it could even lose us our manager. Imagine that.’

    If?? They will LOVE it.. No if there.. But I also don’t see it leading to Wenger actually being sacked or resigning. I don’t see that happening. What it will do is cause a clearer rift among fans, and apart from creating unnecessary media coverage will also lead to fans being branded as a joke. Seriously, if they are that precious about being called silly, they have no idea what is in store for them. Did anyone take Liverpool fans seriously when they were protesting? What about the Green and Gold nonsense at Old Trafford? I’d rather my club was kept away from such idiocy, and I hope no one shows up to that stupid meeting.

  • marcus

    Let’s see what happens over the summer.

    The real change has to come in the Football Administration…but failing that, we might just have to adapt 😉

    Adapt as in get some thickset unshaven thugs with large briefcases of money stopping in lay-bys with men in black shorts?

    Well, it wasn’t exactly what I had in mind.

    Personally I think Wenger can adapt to the realities of the BEPL in 2 ways.

    1) He must find players who have the extra chromosone..not necessarily the most skilful players in the world…he really does need a couple of leaders on the field, Keane types.

    Is Scott Parker someone who would fit the bill? I am not sure.

    2) He also could do with buying from M+S . Ok, M+S 30 years ago.
    If he gets the chance, get a couple of British players, Leighton Baines is the kind of player that springs to mind.

    3)Obviously he needs a good No1 GK with experience

    Those would be my suggestions…pragmaticism really. Either that or Stan has a word in a few people’s shell-like, to the effect that we want referees whose backbones point upwards.

    Re positions etc…I just don’t get the fuss. RVP scores a goal a game…what more can u ask of a centre forward?

    Ditch the dead wood, and if a really top player is available, get him. If some mystery 24 year old Slavic defender is available, sure buy them up.

  • Mandy Dodd

    On the protests, if much happens, I am sure there will be some sort of counter protest. Protesting about the club not maximising comercial opportunities – that is pretty niche for a football fan1 I guess peaceful protest is a right but cannot see them acheiving much positive or negative.

    As has been pointed out, Wenger has said frailties will need to be addressed, we now knows he has money and hungry players coming through. Lets wait and see what he does.
    Many have him down as a stubborn dictator, I see him as someone who adapts to the circumstances in which he finds himself – he can do austerity and he can spend and he can develop.
    Lets see him do all three this summer, he will have learned alot over the last few years.

  • bjtgooner

    It is good to know that Arsenal is in good financial standing, but what everyone is interested in is how our financial strength will be related to squad improvement.

    We should remember that we are in this position of strength due to very careful management by Wenger over the last few years. (It would be interesting to look at the spuds balance sheet for the last 2 seasons)!

    It is probable that changes will be relatively few in the summer and we should not expect too many changes just because we have money available – always assuming we do not lose one or more major players. Would a good summer would be one where we retain important players and add 2 or 3 quality and experienced ones? That approach would probably allow ongoing additions each summer.

    A lot of the squad players have received flak over the last few weeks as we dropped out of each competition. We should remember that most of the squad players have played very little or not at all over these weeks and it is the “first team” who have dropping points. (not forgetting refs). It looks as if our method of play should be re-evaluated – it may be difficult to change just now, be certainly it should be reviewed over the summer.

    Regarding the protests; such activities are usually detrimental. Arsenal need good publicity, we do not need a section of the fan base giving the gutter press and slimy media the chance to damage the club further. Too much has already been said/twittered or blogged.

  • Dark Prince

    Regarding our financial prowess – Proud to see Arsenal right up there at the top. However, there is lots of room for improvement and unfortunately we wont be able to improve immediately bcoz of our long term commitments.

    Regarding the protest- i think its shameful what these supporters are doing. If you have complaints and issues then deal it in the AGM. Protests wont help in anyway. If you’re not able to attend the AGM then pls keep ur protests limited to your friends/families or Arsenal blogs.

  • Shard

    My problem with the protests is twofold..

    One, we have no idea who is behind it. Who exactly are these ‘loyal longstanding’ Arsenal fans?
    Two, they have no clear agenda or cause of protest. The ONLY thing with some merit in there is the suggestion that Season ticket holders be allowed to downgrade as well. But it is just that. A suggestion!! How can you protest the lack of something that hasn’t been properly discussed before? All their other ‘concerns’ are vague and in my view purposely so. They just want any and everyone to come and ‘protest’ without any exact reason. I mean one thing they list is our away colours should always be yellow and blue! Wow. What a reason to carry out a protest march.

  • Limestonegunner

    Shard, I agree that it is an unfocused set of concerns that could be dealt in a variety of ways. I think you make a really good point about the suggestion deserving to be dealt with rather than becoming a rationale for a protest before it has been considered by the club.

    The larger discontent with the corporate emphasis over loyal support is the context. There is something to this, but is this the time and the way to express these concerns? I doubt that but I imagine these folks have been feeling alienated by the direction of the club for some time.

  • Shard

    @limestonegunner

    Hi.. I would agree with you, if they stated as much. If they have a problem with that, and feel strongly enough about it, then say so and protest if you want. Call other people too. But for me. All the things they have included are only meant to draw on the negative vibes surrounding the club, and try and get as many people to come as possible. Regardless of whether they actually believe in the ’cause’ (if one exists). Secondly, I don’t trust something which has the potential to become harmful to the club, to have good intentions, especially if the ‘movement’ is organised anonymously.

  • goonergerry

    Its not as if there is any argument that at its core the club makes a profit-the issue is how much and what should it be spent on-new catering Surely fans should have some say in what the club considers to be our priorities ?
    Should the playing side of the business be entirely self sufficient with sales of players paying for any new players? It is when we get into that realm that disagreement and disappointments can occur.
    I hope the club can clarify our objectives on the field for next season-knowing that if we do not acquire additional defensive capability we are unlikely to improve our current standing-and if we lose our best players-for what ever reason -and we are unable to replace them with equivalent ability-we should not expect to perform as well next season. I hope the club can be honest enough to state to fans what is realistic given our playing resources.

  • Rhys Jaggar

    ‘But certainly Real Mad do come up with funny stories – like the one about financing a big transfer just on the sale of shirts. As we pointed out at the time on this site you have to sell shirts with one player’s name on to most of Africa if you want to pay for his transfer that way. Sadly the media didn’t do this simple calculation themselves and mostly bought the story.’

    I think you’ll find that most of the really big transfers are paid for as follows:

    1. Major endorsement deals of the kind which saw Henry, Federer and Woods endorse Gillette’s razors. Real get a sizable cut of such deals and they can easily be valued at £5-10m per annum globally for 3 years.
    2. Selling shirts is indeed a part. If you assume that Real make £5 per shirt and they sell 1 million with, say, Zidane, on it per year, that makes £15m over 3 years.
    3. You then can calculate the effect on gates, prize money from buying a Zidane. If you calculate that you get to the semi-final of ECL at least with him and QF without, then you might reckon on another £10 – 20m over three years. Although it’s not guaranteed. But I’m sure season ticket prices didn’t go down by buying Zidane…….
    4. Summer tours will have greater value with a Zidane, a Beckham. You might add another £5 – 10m over three years as a result.
    5. TV rights are individual in Spain. So with a Zidane, perhaps you can negotiate for more? I’d add another £10 – £15m over 3 years in that regard.

    With Beckham, the President of Real apparently said, anything less than 200 million Euros and I can make money from Beckham.

    Where the real question comes is how much INCREMENTAL revenues you get over what you would have got anyway.

    But I don’t think it’s hard to see how you make money from real galacticos. Although I don’t know what the true figures are.

    What you lot must realise is that the business model in Spain is different to UK.

    It doesn’t mean Real are solvent, it means that you should be cautious before pooh-poohing certain business models……