By Sir Hardly Anyone
So far this transfer window Arsenal have spent £38m and brought in £12m… a loss of £26m. This compares with Chelsea who have a profit of £28m, Liverpool who have a loss of £39.5m, Manchester City who have a loss of £32.3m, Manchester United who have no transactions involving money recorded, and Tottenham who have a loss of £19m.
Here are the details to date…
|Club||Players in||Cost||Players out||Income|
But who can afford to keep on buying? That is the interesting question.
According to FrontOfficeSport Chelsea appear to have a debt of around $1.9 billion. The second most indebted club is Tottenham, which has a debt of $1.06 billion.
Of course debt doesn’t matter until either a) it has to be repaid or b) interest rates start rising. Chelsea have overcome this problem rather easily because it is illegal to pay money to Russian asset owners at present for a UK based company. Tottenham might be a bit more unlucky as interest rates start to rise – although undoubtedly they have some protection against that. But those debts are pretty eye-watering.
Then there is the problem for Chelsea of how much Abramovich has put into the club over the past five years ($451m) while at the same time the owners of Arsenal (not subject to any embargo) have put $260m.
According to the Front Office website, “All the money loaned by Abramovich since 2003 has been interest-free. What this means is that the money is essentially “cheap” relative to other sources of capital.
This is what has kept Chelsea running, and of course, it is true that Abramovich can’t ask for any of his money back at the moment, although maybe one day he might be able to.
So Chelsea is able to consider the transfer market.
But, the same article tells us, “During Abramovich’s tenure, Chelsea generated about $1.1 billion in operating losses,” largely due to the problem of increasing match-day revenue (its a small stadium and doesn’t have the built-in facilities that the new Tottenham Hots stadium does, nor that Arsenal managed to build into their stadium after the move from Highbury.
And there was another issue. Because money seemed limitless, and the owner never took any dividend, everything looked rosy despite the impossibility of earning more from match days. So the wages bill at Chelsea escalated.
Oh yes and there is that funny old thing about the ground being owned by a non-profit company that refused to sell itself to the previous regime. Improving and upgrading Chelsea’s ground is thought to involve costs of around £2.5bn. Which even in these days of oilgarch insanity is rather a lot.
Tottenham has its ground to pay for, and Chelsea has a limited income with its ability to sign anyone wanted now removed. These are the factors that we might see influencing the financial arrangements of the “big six” in the this transfer window, and possibly maybe for seasons to come.
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