Why hasn’t Barcelona signed their summer signing yet? Explaining their financial crisis before LaLiga started

There were player presentations almost weekly at Barcelona this summer. July begins with the launch ceremonies of Franck Kessie and Andreas Christensen, two players signed a free transfer contract. Then Raphinha came from Leeds United, Robert lewandowski are from Bayern Munich and Jules Kounde are from Seville at a cost of more than €150 million in combined transfer fees. Sources have told ESPN more contracts could follow. Chelsea left back Marcos Alonso is expected to move to Camp Nou and City of Manchester‘S Bernardo Silva is still a goal, although one that is a little more difficult to achieve at this stage.

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Barca president Joan Laporta has promised to support coach Xavi Hernandez by building a squad capable of competing on all fronts, but in doing so has raised questions about Barca’s spending. . Laporta himself described Barca as “clinically dead” last year, with a total debt of 1.3 billion euros. Most recently in June, he said the club were still in intensive care. Less than a month later, he signed Lewandowski for 45 million euros and club statement “The only club that doesn’t have the money but buys every player they want. I don’t know how. It’s crazy.”

The source of Barca’s spending is not difficult to understand. In selling 25% of the domestic TV rights to the investment company Sixth Street over 25 years and 24.5% Barca Studios, their in-house production company, to Socios.com, they raised more than 600 million euro. They also recently signed a new sponsorship deal with Spotify, and last year the club took out a €500 million loan from Goldman Sachs to repay the loan.

So the money is still there, even if it comes at the expense of falling future sales and growing long-term debt, but finding money this summer isn’t my biggest problem. Barca. As is the case when Lionel Messi left last year, it was a matter of registering new players in LaLiga’s financial fair play rules. With the new campaign kicking off on Saturday, no Barca signings have been made with the Spanish league.

(Editor’s Note: This page will be updated as the situation develops with Barcelona this week.)

Why can’t Barca register players?

LaLiga’s financial regulations are perhaps the strictest of the top five European leagues. Each Spanish team is given a spending limit that represents the maximum amount they can spend on the first team in relation to players and coaching staff, a figure that includes wages and transfer fees. concession. For example, Lewandowski’s cost on the books would be his salary plus 12.5 million euros as his fees are amortized over the life of his 4-year contract.

Reducted in the simplest possible terms, the limit is essentially Calculation of what the club can afford based on revenue versus expenses and debt. It also applies prior to signing, so if a club does not meet the criteria set forth by the league, they cannot register new players. This is where Barca found themselves just days before opening their season, a home day with Rayo Vallecano.

Spending limits change constantly, but at the end of last season Barca’s limit was – 144 million euros (about 600 million euros before the pandemic), the only negative limit in Spain, fueled by a previous campaign loss of more than 400 million euros. Meanwhile, Barca’s salary bill, including depreciation payments, remains at around 500 million euros. While they are out of their bounds, the league only allows them to spend a fraction of what they earn to save on wages, whether through cuts or leaving players and fees. The odds have been 1 to 2, 1 to 3 and 1 to 4 at various times over the past year, the most frequent being 1 to 4, which means they can spend 25% of their earnings or save.

Barca hopes the sale of the TV rights and stake in Barca Studios will raise the limit enough for them to operate on a one-to-one basis and register all of its signings. LaLiga informed them last week that they were not there yet and as a result they have yet to register all of their new signings.

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A source from the league told ESPN that that doesn’t mean they can’t sign some of them, though who will depend on the cost and mix of players. (For example, it takes less pay to sign up for Christensen than Lewandowski.) Barca don’t want to go the route of priority registration if they can avoid it.

Which players are affected?

Just days until Barca host Rayo Vallecano at Camp Nou in the first game of the season, none of the five summer signings – Lewandowski, Raphinha, Christensen, Kounde or Kessie – are registered with the league. . Blaugrana also has not registered the new contracts signed by Ousmane Dembele or Sergi Roberto, one in two. Therefore, these 7 players are currently not eligible to play for Barca, despite having played in the pre-season.

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Julien Laurens asked Gab Marcotti if Barcelona could be forced to start the new season without signing their new player.

What do they need to do to register players?

Simply put, Barca needs to sell more assets. The sale of the television rights (estimated at 5% of the club’s annual revenue of around €40 million, based on the most recent figures) is carried out in two packages, each of which Laporta calls “leverage” finance”. The sale of a 24.5% stake in Barca Studios is the third lever. Now, federation and club sources confirm to ESPN, a fourth lever is needed to allow the registration of all seven players, which is expected to come in the form of another 24.5% of Barca. Studios this week.

However, some sources claim that is still not enough and that the club will only launch shortly in terms of signing up everyone. So the club continues to work on trips – Samuel Umtiti, Martin Braithwaite and Memphis Depay All were advised to find a new club – and reduce their wages. Ongoing talks with Gerard Pique and Sergio Busquetsamong others, to find a solution.

The club has also said publicly that the midfielder Frenkie de Jongtopics of interest from Manchester United and Chelsea, it is necessary to reduce his salary if he does not leave the club. Receiving 85 million euros in transfer fee for the Dutch midfielder would solve a lot of their problems, but sources say he still intends to stay.

All of this was repeated last summer, when Pique, Busquets and Jordi Alba adjusted their salary to allow Memphis registration, Eric Garcia and Sergio Aguero.

It is worth noting that last summer the solution came late. Adjustment of Pique allow Barcelona to register Garcia and Memphis on Saturday, August 14 – just 24 hours before their first game of the campaign, which was a 4-2 win over Real Sociedad. However, until a day before the end of the summer transfer window, Alba and Busquets’ reduced so the club can confirm Sign up of Aguero with the league.

What is their timeline for doing so? Any deadline?

Technically, Barca have until the end of the transfer window (August 31) to register players with LaLiga, but Saturday’s first game of the season was a date marked in red. All five new signings played active roles in pre-season, along with Dembele and Sergi Roberto. No one wants to be a player – or players – unsubscribed in this weekend’s Rayo game.

Barca needs the paperwork for the fourth financial lever, which is not yet official, to be approved as soon as possible, but players can be registered as soon as match day.

What if they can’t sign up players before this weekend?

This is when things got worse. Barca could sign up until the end of the transfer window, but they could have some unhappy players and agents if things aren’t sorted out by then. Also, it is uncertain what was included regarding potential escape clauses in each player’s contract. As Barca’s financial problems are well documented, a source in the football industry said it would be irresponsible if the agents involved did not negotiate terms for the situation in which their client remained. unregistered.

More, ESPN reported on Wednesday that two players signed with free agents, Kessie and Christensen, can carry out a contract clause that would allow them to find new clubs if they fail to register in time for this weekend’s opening game against Rayo Vallecano. Sources say that at this point, neither of them plan to implement this clause in their contracts.

It should be emphasized that Laporta continues to instill a belief that people will be registered, but if they do not, there are various options, such as implementing elope terms, going out on loan or spent the next five months in the stands until January. window opens.