Why did Arsenal pay for Tierney upfront when the player was injured?

By Tony Attwood

I am very grateful to Untold reader Segun Lawson for his help in compiling of data for this piece on Arsenal’s finances and accounting procedures.  The opinions however are mine.

The story is this: Arsenal wanted to buy Tierney.  Celtic were willing to sell, and there was the normal coming and going in terms of price, as is to be expected.   Eventually the clubs agreed on a price, but later it became clear that not only had the price risen significantly from Arsenal’s original offer, but also the full amount was to be paid at once, despite the fact that the player was injured.

Now we know that most transfers are paid for over time – although as Swiss Ramble recently pointed out in a post, there are at least ten different ways of accounting for player sales and purchases.   But it looks as if this case doesn’t quite fit into any of those.  Payment up front in full for an injured player.  So what was going on?

The first thing, as always, in trying to unravel such affairs, where one obviously cannot simply go and ask the participants why they did x and not y, is to try and get some background.

Looking through Celtic’s historic accounts it is clear that Celtic’s profits increased from £500,000 in 2016 to £6.9million in 2017 with £5 million more being spent on ‘investment in football personnel’ which presumably is accountant speak for player transfers.  Arsenal on the other hand announced pre-tax profit of £44.6million, after turnover at the club rose by over £70m in the year up to 31 May 2017.  

The difference in scale between the two clubs is enormous and this gives us a clue as to what is going on.  Arsenal undoubtedly have more money in the bank than Celtic, and because they are a much bigger enterprise, financially, they have no difficulty in raising ready cash.   That would have influenced Celtic – after all, in negotiation you don’t demand something that is quite impossible for the other side to pay – unless of course you want to scupper the deal. 

And although Celtic qualify for Europe year after year, how far that journey will go is always uncertain.  They have a fine European heritage of course dating back to 1967 and the Lisbon Lions, and they have just won the league eight times in a row, with the last three seasons being trebles.   But caution must always be their watchword – and quite right too this season as they have been knocked out of the money earning Champs League in the preliminary rounds.

Arsenal however entered the negotiations on a different footing.   Up to 2012, Arsenal’s recruitment expenditure on players was very low – often in fact negative with Mr Wenger using his skills to buy in players on the cheap (Robin van Persie is a prime example, Henry and Vieira are others) and then sell them (or be forced to sell them on) at a massive profit.   But around 2012 things changed and over the next four years there was a net spend up to 2016 of around £49m a year.   The amount has been growing since – something that makes Arsenal Supporters’ Trust’s claim of a limit of £40m or £45m for the summer of 2019 not just wrong in itself, but historically bonkers.

And indeed that was why it was so disappointing to see some otherwise thoughtful bloggers be sucked into signing up to that attack on Arsenal.   There might be things wrong at Arsenal (indeed there are things wrong in my opinion, as I have tried to point out myself on occasion) but the net spend on players since the debt for the stadium was paid off, has not been one of them.

But there is more, for in the case of the recent transfer of Tierney Celtic FC management stated that Arsenal needed to pay the £25m in full up front. This statement comes from their report to the London stock exchange, in compliance with the requirement for companies with multiple share holders, to inform the Exchange about significant revenue generating activity.
Meanwhile, given that Arsenal have just signed a new and financially very exciting deal with Adidas, and so it is possible that this deal had within it a fair amount of money up front, which then led to Arsenal being able to meet Celtic’s demand for money now, not in the future.  It is possible that a deal was struck – Arsenal would pay less in total, but all of that total on signing the deal.

The blog, Celtic Quick News reported that Celtic “confirmed they received an upfront fee of £25million for Kieran Tierney from Arsenal…

“The deal stalled on a couple of occasion with the Londoners attempting to bargain with the Hoops hierarchy with a submission believed to be in the region of £18million with the remainder made up of add-ons” which Celtic rejected.

The site also says, “A similar letter was released last year when French striker Moussa Dembele left the club for a previous best all-time high fee of £19.8million when he switched to Lyon.”

And I wonder, given that Rangers have been known to struggle to sign players because of their financial history, are Celtic giving themselves lots of cash in the bank so they can offer something that Rangers can’t, when both are in the market.   “We’ll pay up front,” says Celtic, knowing that Rangers struggle to match that.

Of course that is a surmise, and I might be wrong, but there is something driving Celtic’s desire for cash.  Fortunately Arsenal had no problem in meeting it.

5 Replies to “Why did Arsenal pay for Tierney upfront when the player was injured?”

  1. Buying a player who is injured is not that unusual. Think Kanu and Marc Overmars. I’m sure if you looked at the medical records of professional footballers, you would see that most are carrying one thing or another. Celtic wanted the money up front. Again, any business would want the same. Wouldn’t you? Apparently, Arsenal have been following the boy for a number of years and was prepared to stump up the cash, which was low by today’s standards. It doesn’t seem that Tierney was angling for a move or being disruptive, so Celtic stuck to their guns (no pun). All in all, a pretty routine bit of business. Where’s the mystery?

  2. “There might be things wrong at Arsenal (indeed there are things wrong in my opinion, as I have tried to point out myself on occasion) but the net spend on players since the debt for the stadium was paid off, has not been one of them.”

    This isn’t the first time you’ve claimed the stadium debt has been paid off. It hasn’t.

    Quoting Swiss Ramble: “Arsenal had £217m debt remaining in 2018 with the majority only due to be repaid in 2029 (£50m in 2031).”

  3. “..something that makes Arsenal Supporters’ Trust’s claim of a limit of £40m or £45m for the summer of 2019 not just wrong in itself, but historically bonkers.” No offence but you keep repeating this. We know that already and I’m sure everyone who believed it will not fall for something similar next time. What you’ve never mentioned is the other issues AST raised in the open letter. I really would like to know what your opinion is as regards those.

  4. Zhord
    The other issues raised in the letter include indifference to supporters by the owners, lack of communication or truthful communication by the management and a request to the owners to sell their stake in the Arsenal to other people who may be willing to match the spending of other clubs with their own funds.
    Mr Attwood has severally addressed these.issues. YOU CANNOT FORCE Mr Stan to sell his stake in what is actually private property! Fans support the club. They don’t own it. While it is nice to hear from the owners from time to time, they do not owe anyone that obligation. Fans always have the choice to withdraw their support anytime, for any reason . Finally, the club heirachy are obligated to address the public at the end of every financial when it is publicly owned. Now however, Mr Stan owns 100% of Arsenal so………..!
    As fans let’s support our club and make suggestions to help better the club we so love . We must also learn to manage some of our expectations concerning the management of the club because we supporters are not owners.

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