Messi has cash-strapped Barcelona over a barrel
➤ Catalan giants are staring at financial disaster in Covid world ➤ Loss of Argentine superstar could solve club’s money crisis
When Barcelona sold Neymar to Paris St-Germain in the summer of 2017, a transfer sensation by any measure, the board of the Catalan club made a very public show of their resistance to the €222million (£198million) sale that was paid in one instalment as per the league’s rules on buyout clauses.
For the president Josep Maria Bartomeu, the scion of a Catalan industrial family and faced with losing one of the playing and commercial assets integral to the modern vision of Barcelona, the sale had to be presented as a betrayal of his club. He suggested, not unreasonably, that it was about money for Neymar and that given the choice, the club would have kept him rather than take a world-record transfer fee paid up front. “No individual interests,” Bartomeu said, “can take precedence over the interests of the club.”
Yet when the club’s accounts for the year 2017-18 were published in October of the following year, the full impact of Neymar’s transfer was clear: rather than punish Barcelona, it had saved them. Losing the burden of his salary kept the revenue-to-wages ratio below 70 per cent – it would have been 89.5 per cent otherwise – and left the club in profit for that financial year. The following season the club needed to open a credit line with a United States hedge fund, and although they have traded players since then, none has realised the value of their former Brazilian superstar.
Now, with a wage bill budget of €671million in the Covid era, the issue for Bartomeu and the board is their personal liability for the finances of the club under the Spanish law that governs sports clubs owned by their membership. Since the Covid-19 outbreak, the club, one of four along with Real Madrid, Athletic Bilbao and Osasuna released from the legal obligation to operate as PLCs, have lobbied for a change to the rules on liability.
While the departure of Lionel Messi might be a disastrous development for the club’s public face, behind the scenes it could be regarded as a necessary evil that saves the board in a potential Covid financial apocalypse. Like Neymar’s sale three years earlier, the club can argue it was against all their wishes. Yet even if Messi leaves for free, the lifting of his wage burden alone solves some of Barcelona’s pressing financial issues caused by the mistakes of Bartomeu and his board.
There has been no clear disclosure of finances since the pre-Covid days of last October when the situation was precarious. The board has been bullish about reaching an annual revenue stream of €1billion – “staggering financial growth,” Bartomeu described it as in his preamble to the October results for the 2018-19 season. Even then, on a revenue of €990million, the operating expenditure was €973million with just €4.5 million in profits after tax.
There has been no clear signal yet of how much Covid has cost Barcelona since. The Catalan newspaper La Vanguardia has estimated it at €154 million. The haste with which the club approached their football and basketball stars for cuts in March suggested a serious problem.
What part of that wage bill is represented by Messi’s salary is unknown, but suggestions that it is upwards of €90million gross would make it clear that his departure would be a critical saving. So, too,
Luis Suarez, Ivan Rakitic and many of the others said to be part of the Ronald Koeman purge. Once again, the club’s position is that they wish to retain their captain and greatestever player, but his departure would not be without its benefits.
The vote of no confidence in Bartomeu, begun yesterday, would need 16,000 members’ signatures – an achievable total, but the process itself is likely to take up to three months, by which time Messi intends to have left. He has instructed a law firm to advise him on his contract freedom and he clearly means business. If there is a destination for him at one of the Manchester clubs or PSG or Inter Milan, that deal would have to be completed before the transfer deadline on Oct 5.
The resignation of Bartomeu and the board that he selected might change Messi’s perspective, but it would not change the fundamental problem. Bartomeu has chosen to focus on expanding the revenue and the race to reach €1billion first, without being able to cut the wage bill. He took the merchandising operation away from Nike, but while that has increased turnover it has not increased the profits.
They have not signed Neymar or Paul Pogba, or many of those they have been reported to be interested in, because there is not the financial power to do so. Those stars who have been signed, Philippe Coutinho, Ousmane Dembele, Antoine Griezmann, Frenkie de Jong, are yet to deliver the uplift required and so the wage bill has grown while the star man has become ever more dissatisfied.
If Bartomeu bows to pressure and resigns, one year before the end of his term, then perhaps Messi will stay and a crisis will have been avoided. But the next president will find himself with little room to manoeuvre and the obligation of his most famous player’s salary still payable in an era in which revenues are shrinking.
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