Football's Magic Money Tree

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Royboyclaret
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Re: Football's Magic Money Tree

Post by Royboyclaret » Fri Jul 31, 2020 4:49 pm

WillDanceForChocolat wrote:
Fri Jul 31, 2020 3:44 pm
We do own the training ground as it is but it's very limited which is why a new one is being built. Building something like that in the Bournemouth cornubation is extremely challenging in a way that isn't in many other parts of the country as there's simply no land available. The same applies to the stadium issue. There are no brownfield sites like, for example, Southampton picked up as there's no history of industry and so on in the area.

In the end they had to resort to buying a golf course and going through and whole planning process in order to find space for the new training facility. That kind of thing doesn't happen overnight though and even then it was only possible because the course closed down. We got a lucky break! When (I guess that may now be a case of if but hopefully not...) it's completed we can then reclaim the land currently used for the training which is by the stadium.

The long term vision was, once the new training facilities were finished and we could knock down the old ones, there would then be a complicated land swap with the council to give us access to other land in the park where the stadium currently is in order to build a new stadium.

I know it's easy to criticise, and my word our fans do it as well, but we're only going to be able to do this once so I'd rather they take 10 years to get it right if that's what it takes than rush it through in 3-4 years, bodge it and then we're stuck.

Trying to build any facilities for the club in a town like Bournemouth where so much of the population have moved from other parts of the country and so have no affinity for the club is a very delicate balancing act. When we rebuilt the stadium last time, bearing in mind that wasn't really a huge change in footprint or capacity, some recent arrivals to the town formed up a protest group to try and stop it and even try to use some kind of sand lizards that maybe lived nearby. They couldn't give a stuff about the club, they just knew it they could drive it away it would increase their house prices. It created a lot of problems at the time as any pressure group that's noisy enough can with local councils.

So yes, we're in a very challenging situation with the facilities but progress is slowly and surely being made.

As for the ownership of the current stadium, well that's still to be resolved but we still retain ownership of about a quarter so it isn't like the owners can do a lot with the land without us on board. Some kind of accommodation would eventually be reached, it was more of a case that nothing could proceed until the training ground was completed first. When that's done then negotiations could begin in earnest.
An interesting insight there from a Bournemouth fan, thanks for that.

However, perhaps more of an immediate and pressing need than a new training ground might be to address the dire financial situation presently. Looking at the last reported numbers it would appear that Bournemouth have the largest Wage bill of the three relegated clubs at £112m, an Operating Loss of £30m, a financial debt to the owner of £101m and a net Transfer debt of £81m.

Plenty to focus the attention, there.

Royboyclaret
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Re: Football's Magic Money Tree

Post by Royboyclaret » Sun Aug 02, 2020 3:02 pm

claretandy wrote:
Fri Jul 24, 2020 8:56 am
Swiss ramble thinks we will get 16m more than last year, if we finish 9th, each place is now worth 2.7m after the rebate.

https://twitter.com/SwissRamble/status/ ... 33569?s=19
As it transpired that figure was £13.3m (10th from 15th) and we shared with Southampton the distinction of gaining the most from the previous season by finishing five places higher.

Of course we will need that additional merit money (and more) to offset the £17.3m Broadcast rebate payment as a result of the effect of the pandemic on the TV schedules.

The big concern for us will be if the current behind closed doors arrangement continues indefinitely into next season. Then the real problems start and some communication and assurances on the matter from Mr.Garlick would be most welcome.

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Re: Football's Magic Money Tree

Post by Chester Perry » Sun Aug 02, 2020 3:59 pm

Chester Perry wrote:
Tue Jul 21, 2020 4:13 pm
Leeds United, have reset the possibilities of what is commercially possible in the Championship and they look to be swiftly moving forward on what they can do in the Premier League - firstly by ditching their kit supplier - Kappa. they also have an expectation that their minority shareholder will put some significant money in - must say that I had not remembered that Leeds United were part owned by the San Francisco 49ers.

From SportsProMedia.com

Leeds owner Radrizzani expects San Francisco 49ers to up involvement
English soccer club also confirm end of Kappa kit deal ahead of Premier League return.

Posted: July 21 2020By: Sam Carp

- Radrizzani says Leeds will need more investment following promotion
- NFL’s 49ers currently own 10% stake in English soccer side
- PSG owners QSI previously linked with investment in Yorkshire club

Andrea Radrizzani, the majority owner of Leeds United, says he expects the National Football League’s (NFL) San Francisco 49ers to increase their involvement in the English soccer club following their promotion to the Premier League.

Speaking on a Zoom press conference after Leeds secured a return to English soccer’s top flight for the first time in 16 years, Radrizzani said the Yorkshire club will need more investment to be competitive in the competition.

The Italian businessman, who is also the chairman and founder of multinational broadcaster Eleven Sports, said the initial investment would come from his holding company Aser, but revealed that additional support could eventually be provided by the 49ers, who paid a reported UK£10 million (US$12.6 million) for a ten per cent stake in the club in 2018.

“People have said I would sell in the Premier League, but I have always said I would sell probably if I couldn’t achieve the Premier League,” Radrizzani said.

“But in this case I would love to stay ten years, maybe more, 20, I’m still young. I don’t have any rush. I’m enjoying it.

“[The 49ers] have done a good deal investing in the club with me because they see their investment already worth probably 3.5 times higher in terms of value of what they put [in].

“They are obviously good friends, a good partner and I think they could bring more value in the management of the club in the Premier League than what has been done until now.

“I expect them to help us more, step up and potentially in the future years in the Premier League in club management, particularly the stadium and merchandise.”

Leeds have also previously been linked with investment from Qatar Sports Investments (QSI), which owns French soccer champions Paris Saint-Germain.

Radrizzani said there were no current plans for QSI to invest in Leeds, but did not rule it out in the future.

“We have a very good friendship,” he said. “We have been talking, but to be honest we haven’t reached any concrete point of any negotiation.

“But we are really good friends and if they want seriously to come, they can always find my door open for a discussion, but at this moment there’s nothing.”

Leeds have also revealed that they will be sporting the logo of a new kit supplier when they return to the Premier League by confirming that their current technical partnership with Italian sportswear brand Kappa will end at the conclusion of the 2019/20 season.

The club said the identity of their new kit supplier will be revealed ‘in due course’, although it was reported in January that German brand Adidas was in line to replace Kappa from the 2020/21 campaign.

Leeds’ promotion from the Championship was confirmed on 17th July when West Bromwich Albion lost 2-1 at Huddersfield Town.
seems that the additional investment that Radrizzani called for from the 49ers owners is going to materialize - from the New York Times

San Francisco 49ers Look to Increase Stake in Leeds United
Tariq Panja JULY 17, 2020

LONDON — It took the San Francisco 49ers seven years to turn their interest in owning a piece of an English soccer team into reality. Now, two years after buying a 10 percent stake in Leeds United, the 49ers’ owners are looking to increase their investment, and their involvement, in the storied club that two weeks ago won promotion to the Premier League.

Executives representing the 49ers and Leeds United’s majority owner, Andrea Radrizzani, are in talks about increasing the N.F.L. team’s share, according to Paraag Marathe, the 49ers executive who has sat on the soccer team’s board since San Francisco’s initial investment in 2018.

“It’s something that we are absolutely hoping to do,” Marathe said in a telephone interview.

Any new investment, though, would only further entrench American football team owners in the board rooms of England’s Premier League, the world’s most popular and lucrative domestic soccer competition. The Glazer family, which owns the Tampa Bay Buccaneers, has controlled Manchester United since 2005; Arsenal is backed by the Los Angeles Rams owner E. Stanley Kroenke; and Fulham, which is one win away from clinching a return to the Premier League, is owned by Shahid Khan, who also owns the Jacksonville Jaguars.

Under Radrizzani, an Italian sports media tycoon, Leeds United has long searched for new investment. Radrizzani has been in talks with Qatar’s sovereign wealth fund, which already owns the French superclub Paris St.-Germain, but those discussions — despite reaching an advanced stage last year — have so far failed to produce a sale.

While the 49ers only hold a minority share, they have hardly been passive investors in Leeds. Top executives, including Marathe and Jed York, the 49ers’ chief executive, had been regular visitors to Leeds’ Elland Road stadium until the coronavirus pandemic shut down global travel. Marathe said he and York had traveled to Leeds, a city in northern England, once every five to six weeks.

“It obviously had fallen on hard times under multiple ownership groups,” Marathe said of Leeds, a storied club that has been troubled by financial problems and on-field struggles since tumbling out of the Premier League in 2004. “But the brand equity is still there, the fans, and the amount of people that care about that club,” he said. “We just knew that not only do they belong in the Premier League, but if they got to the Premier League, that the sky’s the limit.”

“The journey isn’t concluded,” he said of the team’s return to England’s top tier. “It’s just beginning.”

The 49ers first took an interest in Leeds United in 2011 when Marathe, the president of 49ers Enterprises, the team’s venture capital division, was scouring the world for sports brands in which the team could invest. In Leeds, he found a team with a long history — a three-time English champion with a passionate fan base in a large city that had no other professional club — and started talks about a relationship. The 49ers did not invest then, but did sign a strategic partnership agreement that largely failed to yield any positive results, according to Marathe.

But the team’s interest in a more direct stake in Leeds remained. By 2015, Marathe had developed a friendship with Radrizzani, who two years later bought Leeds himself. “I said, ‘Wow,’” Marathe recalled saying to Radrizzani shortly after the Italian’s purchase was complete. “‘It’s such a coincidence because I actually love this club and I spent some time around this club.’”

Marathe and Radrizzani speak at least twice a week. And in addition to the regular trips to Leeds, the 49ers regularly share information about their business and processes; when Leeds was beginning the search for its current coach, the 49ers passed on a guide the team used to recruit its current general manager and head coach. Leeds eventually picked Marcelo Bielsa, the charismatic and quirky Argentine who led Leeds back to the Premier League.

The gap in quality — and resources — between the Premier League and the second-tier Championship that Leeds United just won can be significant. Last season’s Championship winner, Norwich City, will return there next season after finishing last in the Premier League this year. Some teams spend heavily to try to become competitive immediately. Others, like Sheffield United, which finished in the top half of the table in its first season back in the top flight, have prospered by relying on the fundamentals that took them there.

Marathe pointed to Sheffield United’s debut season as an example of an approach Leeds might be looking to follow.

“You don’t want to just rush and go high — ‘Every player out now; we’re a Premier League club’ — and buy this and this and this player,” Marathe said. “Sometimes you want to build it organically and thoughtfully.”

Marathe said that, for now, the 49ers remained focused on being patient with their investment — which became far more valuable on July 17, the day Leeds United’s top-flight return was confirmed — rather than on cashing in.

“This is more about continuing the journey than it is about what the multiple on our investment is,” Marathe said.

Ken Belson contributed reporting from New York.

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Re: Football's Magic Money Tree

Post by Royboyclaret » Wed Aug 05, 2020 4:48 pm

Royboyclaret wrote:
Fri Jul 24, 2020 12:12 pm
Clearly the potential £17.3m broadcast rebate will cause some pain in Burnley's boardroom, but just to emphasise how favourably we should come out of this situation in relation to other PL clubs, let's do a direct comparison with say Arsenal.

We lose the £17.3m and say another £1.2m in matchday-receipts, but gain £16.5m in additional prize money. So, a net deficit of some £2m.

Arsenal lose £16.8m and a further £19m in matchday receipts (one fifth of £96m) and lose a further £13.3m for finishing 10th from 5th. So, a net deficit of some £50m.
And now, shock horror, the news that Arsenal are proposing 55 redundancies. For some weeks we've highlighted the problems at the Emirates on this thread and, in particular, the one which directly affects their £96million annual match-day receipts.

This figure is a significant percentage of their Total Income and therefore the longer next season progresses behind-closed-doors the more it will impact on their business. As a comparison our total match-day receipts are a mere £6.3million. Other elements of Revenue at Arsenal are also about to come under more scrutiny as Chester has alluded to a number of times recently on here. Difficult to accept, therefore, that they are prepared to offer a 32 year-old a three year contract to entice the player away from Chelsea while continuing to pay another player £350 grand per week for sitting on his backside. Something feels very wrong financially with the game at the moment.

The only consolation for Arsenal is that, while they may be the first to propose severe redundancies, they most certainly will not be the last. Believe it was Nick Hodgkinson, owner of Huddersfield, who suggested some time ago that between 50 and 60 clubs could go to the wall as a result of this pandemic. He may not be far wrong.

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Re: Football's Magic Money Tree

Post by Chester Perry » Thu Aug 06, 2020 7:00 pm

@KieranMaguire has been updating his table of most Profitable Premier League clubs in history (and the least profitable) we lost a place to Liverpool following their Champions League success last season - (if it was just done on a Premier League earnings only we would be pushing for top place

https://twitter.com/KieranMaguire/statu ... 0098100225

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Re: Football's Magic Money Tree

Post by ecc » Thu Aug 06, 2020 8:10 pm

Can't see this elsewhere.

Roma have been bought by a new American. £532m.

https://www.bbc.com/sport/football/53681230

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Re: Football's Magic Money Tree

Post by Chester Perry » Thu Aug 06, 2020 9:48 pm

The EFL are trying to put spoilers in ahead of tomorrow's EFL voste on Salary caps = arguing that it may be illegal - if that was the case Rugby of both codes would have had there's stopped years ago - from the Guardian

EFL salary cap 'unlawful and unenforceable', says PFA before vote
Clubs to vote on its implementation on Friday
Players’ union calls for period of arbitration this month
Paul MacInnes - Thu 6 Aug 2020 19.00 BSTLast modified on Thu 6 Aug 2020 19.56 BST

The Professional Footballers’ Association has said attempts to impose a salary cap on EFL clubs may be “unlawful and unenforceable” a day before the measures are put to a vote.

EFL clubs are set to decide on Friday whether to implement a salary cap, a move widely claimed as essential in helping the lower leagues reset their finances.

The PFA has weighed in against the proposal, however, claiming the EFL has failed in a legal obligation to fully consult the players’ union over “any potential changes to a player’s conditions”. The union said it was sending its dossier on the effects of a salary cap to clubs, and called for a period of arbitration to take place this month.

“Like everyone involved in football, we want to see sustainable clubs at all levels,” a PFA spokesperson said. “We absolutely understand and appreciate the huge economic pressure clubs have come under due to the Covid-19 crisis.

“The introduction of a salary cap in English football represents a seismic change. It is a change that will have far-reaching and significant impacts right across the professional game. We must take the time to ensure these are properly considered and understood.

“The EFL has a legal obligation to consult with the PFA and the Professional Football Negotiating and Consultative Committee [PFNCC] over any potential changes to a player’s conditions. This consultation has not happened, and as such, we are gravely concerned any cap brought in will be unlawful and unenforceable, which will ultimately be detrimental to everyone involved.”

The Guardian understands discussions involving the EFL and PFA have taken place at the PFNCC. The vote is expected to go ahead as planned.

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Re: Football's Magic Money Tree

Post by Chester Perry » Thu Aug 06, 2020 9:55 pm

An article by the Managing Director of Sports Finance at Macquarie (of factoring fame) essentially telling us why so many Premier League teams need to do this even in pre-covid times - from SportsBusiness.com = interesting that he argues only the biggest clubs can avoid such practises - when our own is virtually notorius for not doing so

Mind the gap: How football clubs can access financing after lockdown
Jerry Korczak, managing director, sports finance, at Macquarie Group, considers the range of finance options available to football clubs to help them navigate the challenges ahead
Jerry Korczak - August 3, 2020

With the Covid-19-delayed Premier League season completed and promotion, relegation, and European qualification issues finally resolved, football clubs are inevitably thinking ahead to the 2020-21 season.

There has been an unprecedented level of uncertainty for clubs and, at the time of writing, it is still not clear when the Premier League – or any of the other major European leagues – will play to full stadiums again. In response, many owners and financial directors are diligently planning for the worst and assuming that there will be no fans in stadiums before the end of the year.

The loss of ticket revenue, merchandising, and food and drink sales presents a significant challenge for clubs. In the Premier League the hard cost of running on empty stadiums could be between £7m (€7.8m/$9.1m) and £15m for each club, depending on the size of stadium and scale of their matchday operations. The top football clubs benefit significantly from media and broadcasting revenues, but the clubs most reliant on matchday revenues now face a significant near-term challenge.

Historically, when facing a cash flow crunch, clubs have relied on affluent owners to provide additional short-term support. However, many of these individuals or groups are currently having to focus their energy, attention and investment on their main cash generating businesses – to ensure those primary businesses successfully navigate the economic impact of the Covid-19 pandemic. The result is that some football clubs will need to look for other ways to manage their current cash flow and working capital challenges.

For fans, the most visible indication of these challenges will be a reduction in the number and level of summer transfers. In addition, cash-rich clubs, already in a strong position going into the pandemic, may use this financial strength to drive the hard bargains with lower-ranked clubs – many of whom are more reliant on transfer fees as a key revenue stream.

As a result, with the exception of some of the biggest European clubs, many football teams will be looking to either borrow money to cover the short-term funding gap, until the fans return, or find ways to reduce costs.

Prior to the global financial crisis over a decade ago, many clubs would have resorted to borrowing against large fixed assets, such as stadiums, to manage cash flow challenges. However, using long-term lending to fund short-term spending carries risks for lenders – and requires the clubs to ensure they have set aside sufficient funds to repay when the loan matures. The result was several defaults after 2008, and the end of this type of lending for all but the largest clubs that fund real estate developments combined with their stadium.

Fortunately, since then, the market has matured considerably – both with the introduction of Financial Fair Play and the increasing professionalism of clubs’ financial departments. Football clubs’ finance departments are now staffed with highly trained accountants, providing greater comfort for lenders and encouraging more UK-based debt providers back into the market.

The main mechanism for lending is now receivable financing, which uses future guaranteed income to provide immediate working capital for clubs, smoothing the club’s cash flow throughout the year – which can be helpful during periods of low or reduced income as we are seeing currently.

Even under normal circumstances, cash flow management is an issue for many clubs because of the timing of centralised payments from leagues. In the case of the Premier League, payments from media revenues are made in July and December – with a third payment including prize or merit money in May. However, spikes in clubs’ expenditure, including player bonuses and contracts, typically fall at other points in the year – meaning a negative cash balance for clubs between December and March ahead of the May payments.

Right now, that pressure is exacerbated by the absence of game day revenues. The simple fact is that there are only so many costs that can be cut – so third-party financing could become a more popular option for clubs looking to navigate the coming months.

While receivables financing is designed to provide working capital, banks and private equity firms can also offer a potential source of larger funds for strategic or development finance. Whatever the need, institutions lend according to the security offered by the club and their own appetite for risk. Because they are contracted to receive a minimum sum each year from the Premier League – and therefore guaranteed income – England’s top-tier clubs still have a range of finance options available to them to help them navigate the challenges ahead.

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Re: Football's Magic Money Tree

Post by Chester Perry » Fri Aug 07, 2020 5:38 pm

another example of the power of contracts signed by the PRemier League when it was formed - this time in relation to the guaranteed involvement in the League cup - with a squeezed season the Premier League want temporay changes to the League cup - they are apparently willing to compensate Sky for the privilege - from the Mail

EXCLUSIVE: Premier League will pay £25m rebate to Sky Sports in return for CANCELLING the Carabao Cup's two-legged semi-finals and big clubs playing weakened teams
Premier League clubs have agreed to fund a £25million rebate to Sky Sports
The broadcaster agreed to abandon the Carabao Cup's two-legged semi-finals
The FA will also make a contribution with the EFL clubs spared any loss
Top flight clubs have agreed to enter the competition despite congestion fears
By MATT HUGHES FOR MAILONLINE

PUBLISHED: 14:45, 7 August 2020 | UPDATED: 15:07, 7 August 2020

Premier League clubs are facing another significant financial loss after agreeing to fund a £25million rebate to Sky Sports in return for abandoning two-legged semi-finals in next season’s Carabao Cup.

Sportsmail has learned that the top-flight clubs agreed on Thursday to underwrite the majority of a refund that has been agreed with Sky as a result of next season’s competition being devalued in the eyes of the broadcaster. The FA will also make a contribution with the EFL clubs spared any loss.

It is understood that the rebate figure is the result of the abolition of the two-legged semi-finals, which will be standalone ties next season, and the probability that clubs involved in European competitions will field weakened teams in the early rounds due to potential clashes with the Champions League and Europa League.

Premier League matches are valued at around £9m each in the current TV deal so the rebate is largely accounted for by the loss of two semi-finals that would almost certainly feature top-flight clubs, with the rest down to the disruption to the early rounds.

The Premier League clubs have agreed to enter the Carabao Cup as normal despite fears over fixture congestion caused by the truncated campaign which will begin on 12 September.

As a result Sky have successfully argued that the competition has been devalued and secured a rebate of almost one-third of £80m rights fee they were due to pay the EFL.

The Carabao Cup is a hugely important source of revenue to EFL clubs, as it accounts for two-thirds of their £119m-a-year broadcast deal with Sky due to the presence of Premier League clubs.

There were fears that those who have qualified for European competitions may seek to withdraw next season so there will be considerable relief amongst the EFL executive that they have agreed to take part, particularly as they have to absorb most of the costs of the Sky rebate.

The Premier League clubs also discussed a proposal to advance another £55m of the solidarity payments that is due to be paid to the EFL next January in two instalments this month and in October, which is expected to be agreed.

The EFL have already received the first £55m portion of this season’s solidary money, which was advanced in April due to the cash crisis caused by the shutdown.

Other than proposing to advance funds they are already owed however the Premier League have yet to providing a rescue package to struggling EFL clubs despite such assistance being a pre-condition of the government’s support for Project Restart.

In a memo circulated to the clubs yesterday the Premier League would only say that a “request for additional assistance would be considered.”

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Re: Football's Magic Money Tree

Post by Chester Perry » Fri Aug 07, 2020 6:26 pm

just come across this interesting site - www.theefl.co.uk which outlines the recent crises clubs in the EFL - still plenty to add I would say starting with Southend, Oldham and Sunderland

https://theefl.co.uk/

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Re: Football's Magic Money Tree

Post by Chester Perry » Fri Aug 07, 2020 7:42 pm

I do not recall this being an investigation - Wolves have been found guilty of failing UEFA FFP - from the BBC

Financial Fair Play: Wolves punished by Uefa after overspending
By Simon Stone

BBC Sport - 1 hour ago

Wolves will only be allowed to register 23 players if they qualify for the Champions League next season, after they failed to meet Uefa's Financial Fair Play target.

Wolves beat Olympiakos to reach the last eight of the Europa League on Wednesday.

It is the first time Wolves have reached the quarter-finals of a European competition in 48 years.

Winning the tournament would earn them a spot in the 2020-21 Champions League.

However, even if they manage it they will not be able to register a full quota of 25 'A List' players as punishment for spending too much.

European football's governing body Uefa revealed the information after confirming it had reached a settlement agreement with Wolves, who play Sevilla in Duisburg on Tuesday.

In addition, Wolves have agreed to report "a maximum break-even deficit of €30m (£27.1m) in the financial year ending in 2020 and to finally reach, in the 2021/22 season, an aggregate break-even result for the financial years ending in 2019, 2020 and 2021".

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Re: Football's Magic Money Tree

Post by Chester Perry » Fri Aug 07, 2020 8:02 pm

Wolves not the only ones to face UEFA FFP sanction - here's the full press statement from UEFA - our defeated opponents in Istanbul (and newly crowned Turkish Champions) Basaksehir amongst the others

https://www.uefa.com/insideuefa/about-u ... -the-cfcb/

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Re: Football's Magic Money Tree

Post by Chester Perry » Fri Aug 07, 2020 8:09 pm

The Times are suggesting that following Sheffield Wednesday's sanction last week that Derby are likely to face sanctions of their own following their hearing last month

The wait goes on for Derby County but sanctions look likely
Martyn Ziegler - Chief Sports Reporter
Friday August 07 2020, 5.00pm, The Times

The noises around Derby County’s protracted disciplinary case for allegedly breaching the English Football League’s financial rules do not sound good for the Championship club.

An independent commission has been hearing the case since mid-July to judge firstly whether the charges have been proven, and if so to hold another hearing to determine the sanction.

Although neither outcome has yet been confirmed, it appears that the case is heading towards Derby being sanctioned despite the club’s furious insistence that the EFL’s actions in charging them were “unlawful and unfair” and that it was the league itself which had made a mistake in signing off their financial declarations.

If it does end with a points deduction for Derby — a transfer embargo or fines are other possible punishments — then, as with Sheffield Wednesday, the sanction would be applied to next season rather than last season, following a precedent set back in 2002 when Boston United were given a four-point deduction for their first season in Division Three (now League Two) rather than the previous season when they were in the Conference.

The charges against Derby, which date back to January, relate to the club allegedly breaching spending rules. They reported a pre-tax profit of £14.6 million after a company belonging to Mel Morris, the owner and chairman, bought Pride Park stadium for £81.1 million. In the club’s books, however, the ground was listed as an asset worth £41 million. An independent valuation by the EFL estimated its value at £49 million.

There is also a charge over Derby’s amortisation policy, which is how a club writes off the cost of a player’s transfer fee over the length of their contract.

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Re: Football's Magic Money Tree

Post by Chester Perry » Sat Aug 08, 2020 4:03 pm

Following last night's exit from the Champions League (in the round of 16) the Telegraph's Sam Wallace once again looks at Real Madrid's current financial situation - some would say he has been wishing financial doom on both Real Madrid and Barcelona for at least 3 years now, each article appearing more ominous than the next. The only surprise is that both clubs have managed to negotiate their ways through the financial mire this long

In debt and out of the Champions League — Real Madrid's financial problems mount
SAM WALLACE AUGUST 08, 2020

Only the third time the question was asked on Friday night did Zinedine Zidane give anything like a clear answer on his future, replying that he would be Real Madrid manager until “something out of the ordinary happens” which, given the club’s history, is no guarantee at all.

Zidane had been riding the crest of Real’s post-lockdown surge to the league title, but now eclipsed by Manchester City in the Champions League in the round of 16, there was again more than a hint of the fundamental problems that surround this club. What detail does this inscrutable man know about the perilous finances of the club? Does he know that, for instance, in the last financial results Real released — the latest half-year results are well overdue – that they budgeted to reach the last eight of the Champions League as a minimum?

When Real sold the highly-rated full-back Achraf Hakimi to Inter Milan for €40 million on June 30, the last day of their financial year, Zidane to his credit did mention in passing that there were financial considerations as well as football. It was the briefest hint at the perfect storm gathering around Real that the Spanish media do their best to ignore. The world’s biggest football brand is in huge debt and the next set of accounts will give us an idea of how much.

There is, of course, no owner at Madrid to inject funds to stabilise the club unless you count the ordinary members from whom around €10 million in cumulative fees will be raised again this summer. The €120 will be a sacrifice to some ordinary Madridistas although not the club’s unchallenged president Florentino Perez. He has all the benefit of ownership with none of the cost and, in recent months Real, as well as Barcelona, have been lobbying government to change the rules that hold directors of sports clubs liable for losses.

Real like to remind us that the club is owned by its fans, but increasingly what those fans own is the debt piled up by the billionaire elected to run it in a one-horse race. More debt accumulates while, on the pitch, the great allure of the tradition and the success is a useful diversion. All of it is a matter of public record. From the bondholders financing the new Bernabeu development, to the American hedge fund that has provided short term loans, to the transfer debts owed to clubs that have fuelled Real’s hunger for new star names.

The €575 million Bernabeu redevelopment continues, in what might generously be described as a brave call in the current climate. It will not increase capacity by a single standard seat, instead adding hotel and retail space in a Covid era where neither is currently in demand. What is sure is that it will saddle the next generation of fans with the debt long after Perez has gone: a fixed €29.5 million per year for 26 years from 2023.

The debt repayable next year to the US hedge fund Providence, the short-term loan provider which has helped Real sustain their wage bill since 2017, has been estimated in Spain at about €200 million. Providence loaned the money in return for a percentage of the increase in commercial revenue, with some exemptions, which has not materialised. In June there was a €100 million state-backed loan made available in the Covid crisis that was taken by Real and raised their bank debt to €150 million.

Cumulatively it could place Real’s net debt at greater than €1 billion although that is not a figure that Perez can seriously hope to present to the club’s members or even a compliant media. It is curious that in the last budget, the club anticipated profit by including what their accountants described as “long-term assets for sale” – in other words, players to be sold for an agreed price. Few major clubs do this, with the exception of Borussia Dortmund, and then only in the case of players for whom they have agreed a transfer. In their last accounts Real recorded assets of €79 million in this category. A figure it said it reached by amortising the value of the fees originally paid for the players in question, which totalled €340 million.

Which means Real must have included their Colombia international James Rodriguez, who has one year left on his deal and for whom there have been no takers, even over the course of an extended loan to Bayern Munich. Another is Gareth Bale, who, since the publication of those last results, and over his long-term fall-out with Zidane, has become Spain’s best-paid golfer. Bale is worth nothing to Madrid in terms of a fee. Instead he represents a draining cost of up to £600,000 per week for another two years.

The cost of Bale, a ruinously expensive blunder between the coaching and recruitment sides of the clubs, is just a small part of the picture that has been made infinitely worse by Covid. There are major losses generated by Real Madrid TV, as well as the professional basketball team that is part of the club. The decision to take their merchandising operation in-house from supplier Adidas to boost revenue, following Barcelona’s move to do the same with Nike, has also laid greater risk upon the club rather than on its sportswear partner.

While in the past the club has made use of an endless supply of credit, the pandemic and its economic consequences have exposed that risky existence and the methods of Perez who seeks to have no more financial liability than the average member forced to watch from home.

At the very least Real must sell players again this summer. Yet the market is depressed, and how many more players of Hakimi’s profile – young, with the potential to accrue value – can they spare? Zidane has done a fine job of delivering results but even he seemed uncertain of the future at Real, just three weeks after winning the league title. One can only assume he knows how difficult it could be to repeat the feat.next - the only surprising thing is that these to have managed to negotiate their way through the mire this long/

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Re: Football's Magic Money Tree

Post by Chester Perry » Sat Aug 08, 2020 8:36 pm

Swansea have added a 3rd American Investor to the club and board - from SportsBusiness.com

Swansea City secures new US investment
Bob Williams, US office - August 7, 2020

English Football League club Swansea City has secured new American investment after private finance entrepreneur Jake Silverstein acquired an undisclosed stake in the Championship team.

The Portland, Oregon-based Silverstein is chairman and chief executive of Stormlight Holdings, the major American-based private investment firm of the Silverstein family.

He is also a co-owner of Major League Soccer’s Houston Dynamo and the National Women’s Soccer League’s Houston Dash.

Silverstein has joined Swansea’s board of directors following his investment.

“We are pleased to welcome Jake to the Board and Swansea City Football Club,’’ said Swansea’s co-managing owners Steve Kaplan and Jason Levien in a statement.

“Jake is a highly-respected individual, businessman and sports team investor. He has experience, knowledge and expertise across a wide range of fields which will be an asset to Swansea City. We are looking forward to his contribution,” the statement added.

In addition, Kaplan and Levien – who are also co-owners of MLS team DC United – have put “additional funds” into the club in the wake of the financial effects of the global Covid-19 pandemic.

The duo took over Swansea in 2016 in a deal worth around £100m (€119.1m/$131.4m).

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Re: Football's Magic Money Tree

Post by Chester Perry » Sat Aug 08, 2020 8:49 pm

More on that increase in involvement at Leeds from Minor Shareholders The San Francisco 49ers (they certainly sound very keen) - from SportsBusiness.com

49ers ready to help Leeds United become “more of a global force”
Bob Williams, US office - August 7, 2020

- NFL team “open” to increasing its investment in club following promotion to Premier League
- Executives eager to help improve Leeds’ commercial fortunes and in-stadium fan experience
- “The story is only beginning…there is a lot more to do,” says 49ers and Leeds executive Marathe

The San Francisco 49ers are ready to play an active role in helping Leeds United become a Premier League force both on and off the field following the club’s promotion to English soccer’s top flight for the first time since 2004.

The National Football League franchise acquired a reported 10-per-cent equity stake in Leeds, via its commercial entity 49ers Enterprises, in 2018, which was worth around £11m (€12m/$14m) at the time of investment.

As part of the partnership, veteran 49ers executive Paraag Marathe – who is the president of 49ers Enterprises and the 49ers executive vice-president of football operations – joined the Leeds board of directors.

Marathe has weekly calls with Leeds majority owner Andrea Radrizzani, with whom he has a close personal relationship, as well as the club’s director of football Victor Orta and chief executive Angus Kinnear. He has also visited Leeds numerous times since 2018, along with 49ers Enterprises director Collin Meador and 49ers majority owner Jed York.

Now, following Leeds’ long-awaited return to the Premier League, 49ers Enterprises is exploring the possibility of increasing its financial investment in the club.

Radrizzani, who is also the chairman and founder of multiterritory broadcaster Eleven Sports, has said he is open to additional external investment to help fund Leeds’ Premier League push, with talks with Qatar Sports Investments having failed to lead to a deal. It is unclear at this stage how much of the club Radrizzani is looking to sell or what additional stake 49ers Enterprises wants to acquire.

“We’re exploring the possibility of maybe becoming even bigger partners. It is something that we’re open to,” Marathe tells SportBusiness. “Hopefully it works out if he’s [Radrizzani] looking for more and we’re open to more than maybe we should try something.”

49ers Enterprises will also look to continue to provide strategic advice in order to help improve the fan experience and layout of Leeds’ home stadium Elland Road, aid the development of a planned state-of-the-art training ground, and further bolster club revenues through other initiatives.

It is also hoped that Leeds will play at the 49ers’ venue Levi’s Stadium, either in the International Champions Cup international pre-season tournament or in an exhibition game.

“The path and the story is only beginning, it’s not the last chapter, it’s now only the second chapter in a much longer book,” Marathe adds. “Now it’s about proving that we belong and trying to climb the ranks within the Premier League so there is a lot more to do. It’s directly correlated with how much we can grow the commercial side of the business in terms of how much more we can afford on the pitch.”

Origin of the partnership
According to Marathe, 49ers Enterprises began exploring a strategic partnership with Leeds in around 2011. Marathe saw great potential in Leeds – a once great English club with a passionate fanbase that had become a shadow of its former self. However, a deal failed to materialize with the ownership group at the time.

“We had been circling around Leeds for quite some time actually, long before Andrea,” Marathe says. “Being in the business of sports for so long, you sort of know what the powerful brands around the world are, the ones that carry a lot of passion and energy, and punch above their weight…and Leeds was always one of those clubs. We had been interested because it was a sleeping giant.”

In the following years, Marathe got to know Radrizzani through a mutual friend and the Italian sports media executive visited the 49ers headquarters around 2015. The two sports industry executives became fast friends.

“We hit it off, there was a personal kinship before it evolved into a professional kinship. I gave him a tour and we spent the day together and he told me that he had been looking at some clubs,” Marathe says.

Two years later, Radrizzani took over Leeds and Marathe reached out to his new friend to inform him of 49ers Enterprises’ coincidental prior interest in Leeds. A deal was quickly reached for 49ers Enterprises to become minority partners in the then Championship club, in May 2018.

“We’ve long been fans and admirers of Leeds as a club and as a brand and I’m glad that two years ago it came to fruition,” Marathe says. “There was such opportunity but not just from a club standpoint – that the club can become bigger and have more revenue – but really because of the passion standpoint. The supporter base is so strong and powerful, it really reminds me of the 49ers fanbase, which is global and much more powerful than the average NFL club so it just struck a chord and struck a tone with us.”

Global ambitions
Marathe is eager to make it clear that while 49ers Enterprises is keen to help Leeds as much as possible, it is Radrizzani who is the club’s driving force.

“We are all eager, enthusiastic passengers on this train – but this train is being driven by Andrea…Andrea’s vision, Marcelo Bielsa’s coaching and Victor and Angus’s leadership. Those guys have been phenomenal,” he says. “One of the things that I really admire about Andrea is he never really says if, he just says when. He’s always had that mindset since as long as I’ve known him. He really willed this to happen.”

Nonetheless, 49ers Enterprises has already helped Leeds’ rise to the top in numerous ways since partnering with the club. This has included helping to bring in new players, via the club’s capital investment, and enhancing pre-match hospitality initiatives at Elland Road.

Notably, the 49ers played a small but significant role in the hiring of Marcelo Bielsa, the iconic former Argentina and Chile national team head coach, whose leadership has proven key in Leeds’ return to the big time.

Marathe explains: “Prior to Andrea, Angus and Victor going out to find coach Bielsa, we had just completed our own search for our own head coach and [general manager]. We had put a process together which we looked at it a little bit differently where we looked for core traits first: vision, leadership, and someone who really stood as the face of the franchise that everyone – fans, players, coaches…even ownership – would look to for guidance.

“We found that with [49ers head coach] Kyle Shanahan. We documented a lot of that process and we shared that with Andrea prior to them going out to get coach Bielsa,” he says.

Perhaps it is not without coincidence that Leeds secured promotion to the Premier League just a few months after the 49ers won the NFC Championship game to reach Super Bowl LIV in Miami, Florida, in February, after five straight non-winning seasons.

The 49ers lost 31-20 to the Kansas City Chiefs in the NFL showpiece game. But the team looks poised to again be a perennial contender as it was for much of the 1980s and 1990s en route to winning five Super Bowls.

The goal now is to help Leeds become a consistent contender in the Premier League and improve the club’s commercial fortunes, both domestically and internationally.

“One fantastic thing about the way the Premier League or the [English Football League] works is that the club controls and owns its brand globally,” Marathe says. “That is different from American sports with the 49ers where we only really control the brand within our local market and anything outside of the market the NFL, as a whole, controls all 32 logos.

“So this provides a huge opportunity for clubs like Leeds, as Manchester United has already demonstrated, that they can do things in Asia and South America. That is something I’m excited to see if we can help Leeds really become more of a global force,” he says.

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Re: Football's Magic Money Tree

Post by Chester Perry » Sat Aug 08, 2020 8:54 pm

The Head of BT Sport believes that the Covid crises has accelerated the fall in the value of sports rights - from SportProMedia.com

BT Sport’s Simon Green: ‘Covid-19 will accelerate the decrease in sports rights values’
Head of UK pay-TV network predicts greater spending scrutiny post-pandemic.

Posted: August 7 2020 By: Steven Impey

- BT suffered UK£385m year-on-year fall in revenues between May and July
- Customer refunds paid to BT Sport subscribers cited as key factor

Simon Green, the head of UK pay-TV broadcaster BT Sport, believes the financial implications of the coronavirus pandemic for media companies will accelerate the decline in the value of sports rights.

With the challenges facing broadcasters, including the ongoing ramifications of the enforced live sports hiatus, many have adjusted their budgets and sought to renegotiate contracts.

As the secondary domestic broadcast partner for top-flight English soccer’s Premier League, BT Sport got awarded a significant share of the UK£223 million (US$279.6 million) rebate for the stoppage of Premier League games as a result of the pandemic.

However, at the end of July, BT announced revenues of UK£5.2 billion for its first quarter, down seven per cent from a year earlier, citing refunds to BT Sport customers as a key factor. That kind of downturn in returns will likely be seen industry-wide and have knock-on effects.

Speaking to the Guardian newspaper, Green said: “I personally believe that Covid-19 will cause a correction in the markets for television sports rights which will mean the value will not rise as it has done in the past.

“I think everyone will be more discerning about what they pay given that the country is facing a potential recession which could leave viewers with less money in their pockets.”

Despite seeing first quarter revenues fall by UK£385 million (US$505 million), BT chief executive Philip Jansen said that the company has “delivered a strong operating performance” amid the Covid-19 crisis.

It is widely thought that with the rights war between BT Sport and its domestic rival Sky Sports has cooled now that fees for sports content have peaked in the UK.

In November, BT Sport paid UK£1.2 billion (US$1.5 billion) to retain exclusive rights to the Uefa Champions League and Uefa Europa League, European soccer’s top two club tournaments, through 2024. That figure did not mark any change on what BT paid for its existing contract.

For the 2019 to 2022 rights cycle, Sky and BT were able to reduce their collective Premier League rights fee from UK£5.14 billion (US$6.74 billion) to UK£4.46 billion (US$5.84 billion).

Now, with the impact of the pandemic, Green believes that greater scrutiny on budgets will see that trend accelerate.

“We want to be able to offer customers value and while it is impossible to say exactly what will happen, there will be a different approach,” Green continued. “At BT, we will look at every tender-right that comes along and value it accordingly.

“What the lockdown highlighted was the importance of live sport. When it returned with the Bundesliga [in May], our audience over three channels was 750,000 compared to 100,000 before.”

Meanwhile, Green said that BT Sport is confident in retaining its rights to Premiership Rugby when its contract expires in 2021, describing its relationship with English rugby union’s top flight as “one of the best I have known”.

With the sport’s global governing body World Rugby seeking changes to the rugby calendar in light of the coronavirus pandemic, Green also said that he would take no issue with domestic games being played over the summer.

“We recognise rugby has calendar issues and it is an issue for the sport,” he said. “There are times in the season currently when clubs have potentially weakened squads because of international commitments.

“We would prefer the clubs to be at full strength as often as possible and if there were never a clash with international rugby on a weekend, it would be fantastic for us. If the clubs went to the summer and we were the broadcaster, we would embrace it.”

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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 8:40 am

HMRC are looking at image rights contracts again with investigations opened on 246 players in the last season - from the Guardian


Tax affairs of 246 footballers being investigated by HMRC in 2019-20
Tax authorities increasingly concerned by tax loophole
Players pay 19% tax on image rights compared with 45% on wages
Paul MacInnes - Mon 10 Aug 2020 00.01 BST Last modified on Mon 10 Aug 2020 04.37 BST

The number of footballers investigated by HMRC rose dramatically in the tax year 2019-20, going up from 87 to 246 individuals, according to research by the accountancy firm UHY Hacker Young.

The figures show footballers and their image rights are coming under increasing scrutiny as the UK tax authorities look to clamp down on loopholes in the way players are paid.

The number of investigations into the tax affairs of football agents also increased substantially, more than doubling from 23 in 2018-19 to 55 in 2019-20.

Hacker Young argues that this increase tallies with greater interest in the image rights regularly negotiated by players as an extension to their salary.

Image rights allow a club to use the name and the likeness of a player (as well as the actual individual when appropriate) to market and sell the club’s wares and those of their sponsors.

While a player’s wage, in the Premier League and Championship, will be levied with a 45% income tax charge, image rights are taxed at the 19% corporation tax rate, making it a far more lucrative mode of payment for the player.

While some players would be able to command enormous fees for their image rights and may have a more valuable brand than the club they play for, negotiating image rights is an increasingly standard practice among players with less name recognition too.

Elliot Buss, a partner at UHY Hacker Young says: “HMRC believes that lots of lesser-known footballers are effectively avoiding tax by getting paid huge sums for image rights that HMRC views as overpriced.

“The image rights of the likes of Paul Pogba and Mohamed Salah are undoubtedly worth millions of pounds a year. However, if you are second-choice left back in the Championship getting paid a great deal in image-rights payments, then this is likely to trigger an investigation by the taxman. You may have to make a robust argument to HMRC to show how the value of the image rights has been arrived at.”

The kind of calculations that would be required to work out the value of a player’s image would include the amount of money they could charge for making a public appearance or for endorsing a product as well as the more traditional totting up around the sale of replica kits.

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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 8:47 am

@SwissRamble estimates earnings from this seasons Champions League to date - as the last 8 tournament in Lisbon comes later this week

https://twitter.com/SwissRamble/status/ ... 3914373120

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Re: Football's Magic Money Tree

Post by Royboyclaret » Mon Aug 10, 2020 11:37 am

Chester Perry wrote:
Mon Aug 10, 2020 8:47 am
@SwissRamble estimates earnings from this seasons Champions League to date - as the last 8 tournament in Lisbon comes later this week

https://twitter.com/SwissRamble/status/ ... 3914373120
Some startling numbers there in the Champions League in terms of comparisons with the previous cycle. The amount distributed to clubs has risen by a remarkable 54% from 1.27 billion Euros to 1.95 billion Euros in the current cycle, with Barcelona alone looking at potential earnings of 105 million Euros.

Perhaps asking too much for one final miracle from Mr.Dyche and qualification for the Champions League with a lucrative season to follow. Certainly would ease any short term financial concerns at the club and participation for the first time in 60 years in what was then the European Cup. We beat Reims in Round 2 and went out to Hamburg in unfortunate circumstances in Round 3. Would give my right arm to peruse Burnley's financial accounts for 1960/61 and see just how much participation meant to our Club way back then, no doubt the total amount would fit into the average size Burnley wallet.

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Re: Football's Magic Money Tree

Post by Colburn_Claret » Mon Aug 10, 2020 2:00 pm

Royboyclaret wrote:
Mon Aug 10, 2020 11:37 am
Some startling numbers there in the Champions League in terms of comparisons with the previous cycle. The amount distributed to clubs has risen by a remarkable 54% from 1.27 billion Euros to 1.95 billion Euros in the current cycle, with Barcelona alone looking at potential earnings of 105 million Euros.

Perhaps asking too much for one final miracle from Mr.Dyche and qualification for the Champions League with a lucrative season to follow. Certainly would ease any short term financial concerns at the club and participation for the first time in 60 years in what was then the European Cup. We beat Reims in Round 2 and went out to Hamburg in unfortunate circumstances in Round 3. Would give my right arm to peruse Burnley's financial accounts for 1960/61 and see just how much participation meant to our Club way back then, no doubt the total amount would fit into the average size Burnley wallet.
Most likely asking too much, but I love the optimism.

UTC

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Re: Football's Magic Money Tree

Post by Colburn_Claret » Mon Aug 10, 2020 2:09 pm

Chester Perry wrote:
Sat Aug 08, 2020 4:03 pm
Following last night's exit from the Champions League (in the round of 16) the Telegraph's Sam Wallace once again looks at Real Madrid's current financial situation - some would say he has been wishing financial doom on both Real Madrid and Barcelona for at least 3 years now, each article appearing more ominous than the next. The only surprise is that both clubs have managed to negotiate their ways through the financial mire this long

In debt and out of the Champions League — Real Madrid's financial problems mount
SAM WALLACE AUGUST 08, 2020

Only the third time the question was asked on Friday night did Zinedine Zidane give anything like a clear answer on his future, replying that he would be Real Madrid manager until “something out of the ordinary happens” which, given the club’s history, is no guarantee at all.

Zidane had been riding the crest of Real’s post-lockdown surge to the league title, but now eclipsed by Manchester City in the Champions League in the round of 16, there was again more than a hint of the fundamental problems that surround this club. What detail does this inscrutable man know about the perilous finances of the club? Does he know that, for instance, in the last financial results Real released — the latest half-year results are well overdue – that they budgeted to reach the last eight of the Champions League as a minimum?

When Real sold the highly-rated full-back Achraf Hakimi to Inter Milan for €40 million on June 30, the last day of their financial year, Zidane to his credit did mention in passing that there were financial considerations as well as football. It was the briefest hint at the perfect storm gathering around Real that the Spanish media do their best to ignore. The world’s biggest football brand is in huge debt and the next set of accounts will give us an idea of how much.

There is, of course, no owner at Madrid to inject funds to stabilise the club unless you count the ordinary members from whom around €10 million in cumulative fees will be raised again this summer. The €120 will be a sacrifice to some ordinary Madridistas although not the club’s unchallenged president Florentino Perez. He has all the benefit of ownership with none of the cost and, in recent months Real, as well as Barcelona, have been lobbying government to change the rules that hold directors of sports clubs liable for losses.

Real like to remind us that the club is owned by its fans, but increasingly what those fans own is the debt piled up by the billionaire elected to run it in a one-horse race. More debt accumulates while, on the pitch, the great allure of the tradition and the success is a useful diversion. All of it is a matter of public record. From the bondholders financing the new Bernabeu development, to the American hedge fund that has provided short term loans, to the transfer debts owed to clubs that have fuelled Real’s hunger for new star names.

The €575 million Bernabeu redevelopment continues, in what might generously be described as a brave call in the current climate. It will not increase capacity by a single standard seat, instead adding hotel and retail space in a Covid era where neither is currently in demand. What is sure is that it will saddle the next generation of fans with the debt long after Perez has gone: a fixed €29.5 million per year for 26 years from 2023.

The debt repayable next year to the US hedge fund Providence, the short-term loan provider which has helped Real sustain their wage bill since 2017, has been estimated in Spain at about €200 million. Providence loaned the money in return for a percentage of the increase in commercial revenue, with some exemptions, which has not materialised. In June there was a €100 million state-backed loan made available in the Covid crisis that was taken by Real and raised their bank debt to €150 million.

Cumulatively it could place Real’s net debt at greater than €1 billion although that is not a figure that Perez can seriously hope to present to the club’s members or even a compliant media. It is curious that in the last budget, the club anticipated profit by including what their accountants described as “long-term assets for sale” – in other words, players to be sold for an agreed price. Few major clubs do this, with the exception of Borussia Dortmund, and then only in the case of players for whom they have agreed a transfer. In their last accounts Real recorded assets of €79 million in this category. A figure it said it reached by amortising the value of the fees originally paid for the players in question, which totalled €340 million.

Which means Real must have included their Colombia international James Rodriguez, who has one year left on his deal and for whom there have been no takers, even over the course of an extended loan to Bayern Munich. Another is Gareth Bale, who, since the publication of those last results, and over his long-term fall-out with Zidane, has become Spain’s best-paid golfer. Bale is worth nothing to Madrid in terms of a fee. Instead he represents a draining cost of up to £600,000 per week for another two years.

The cost of Bale, a ruinously expensive blunder between the coaching and recruitment sides of the clubs, is just a small part of the picture that has been made infinitely worse by Covid. There are major losses generated by Real Madrid TV, as well as the professional basketball team that is part of the club. The decision to take their merchandising operation in-house from supplier Adidas to boost revenue, following Barcelona’s move to do the same with Nike, has also laid greater risk upon the club rather than on its sportswear partner.

While in the past the club has made use of an endless supply of credit, the pandemic and its economic consequences have exposed that risky existence and the methods of Perez who seeks to have no more financial liability than the average member forced to watch from home.

At the very least Real must sell players again this summer. Yet the market is depressed, and how many more players of Hakimi’s profile – young, with the potential to accrue value – can they spare? Zidane has done a fine job of delivering results but even he seemed uncertain of the future at Real, just three weeks after winning the league title. One can only assume he knows how difficult it could be to repeat the feat.next - the only surprising thing is that these to have managed to negotiate their way through the mire this long/
Being Spain, they could well get away with it, but Eufa should pass the word that if any such law is passed, Spanish teams will be banned from Europe.
There'd be absolutely nothing to stop them, or any other chancer, from doing a Ridsdale and paying 10p in the pound, then start all over again.
Ridiculous.

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Re: Football's Magic Money Tree

Post by GodIsADeeJay81 » Mon Aug 10, 2020 2:45 pm

Chester Perry wrote:
Mon Aug 10, 2020 8:40 am
HMRC are looking at image rights contracts again with investigations opened on 246 players in the last season - from the Guardian


Tax affairs of 246 footballers being investigated by HMRC in 2019-20
Tax authorities increasingly concerned by tax loophole
Players pay 19% tax on image rights compared with 45% on wages
Paul MacInnes - Mon 10 Aug 2020 00.01 BST Last modified on Mon 10 Aug 2020 04.37 BST

The number of footballers investigated by HMRC rose dramatically in the tax year 2019-20, going up from 87 to 246 individuals, according to research by the accountancy firm UHY Hacker Young.

The figures show footballers and their image rights are coming under increasing scrutiny as the UK tax authorities look to clamp down on loopholes in the way players are paid.

The number of investigations into the tax affairs of football agents also increased substantially, more than doubling from 23 in 2018-19 to 55 in 2019-20.

Hacker Young argues that this increase tallies with greater interest in the image rights regularly negotiated by players as an extension to their salary.

Image rights allow a club to use the name and the likeness of a player (as well as the actual individual when appropriate) to market and sell the club’s wares and those of their sponsors.

While a player’s wage, in the Premier League and Championship, will be levied with a 45% income tax charge, image rights are taxed at the 19% corporation tax rate, making it a far more lucrative mode of payment for the player.

While some players would be able to command enormous fees for their image rights and may have a more valuable brand than the club they play for, negotiating image rights is an increasingly standard practice among players with less name recognition too.

Elliot Buss, a partner at UHY Hacker Young says: “HMRC believes that lots of lesser-known footballers are effectively avoiding tax by getting paid huge sums for image rights that HMRC views as overpriced.

“The image rights of the likes of Paul Pogba and Mohamed Salah are undoubtedly worth millions of pounds a year. However, if you are second-choice left back in the Championship getting paid a great deal in image-rights payments, then this is likely to trigger an investigation by the taxman. You may have to make a robust argument to HMRC to show how the value of the image rights has been arrived at.”

The kind of calculations that would be required to work out the value of a player’s image would include the amount of money they could charge for making a public appearance or for endorsing a product as well as the more traditional totting up around the sale of replica kits.
I seem to recall reading an article a few years ago about image rights and they were talking about youth players having them in their contracts despite still being unknown players and never having been in the first team.

Chester Perry
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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 5:18 pm

Monday means another column from John Nicholson at Football365.com - he he follows a recent theme.

The shift from People’s Game to game without people is complete
Date published: Monday 10th August 2020 9:44

The change from the People’s Game to the game without people has been seamless. Are fans even needed at football anymore?

I was listening to 5 Live’s coverage of the Champions League games this week and, as ever, the commentators were doing a very good job at describing the action, managing to create tension and release, with excitement and passion in their voices. There was plenty of football discussion, as per usual. All felt as it always used to feel.

There are adverts on talkSPORT telling me the football is back and that it’s time to be Gamble Aware again. Programmes are interrupted for the odds on various games and outcomes. All very normal.

I watched some clips and highlights of games and saw players celebrating goals in the exact same way as they normally do, joyous and with arms aloft in front of no-one, as if it was a packed ground.

And every day of the week I’ve listened to my usual raft of podcasts and read newspaper pieces all talking about the games: who played well, who didn’t, what tactics were deployed and how managers had reacted. Same as it ever was.

The sports pages are, as usual, full of stories about transfers and loans, with the richest spending millions to leverage their financial advantage over the rest to an even greater degree than usual. Fans of clubs are busy bitching and moaning at each other in the usual way. The football-as-shopping addicts are out in force demanding their club buy players because that’s all they’re interested in.

Managers are getting sacked and replacements installed, also as per normal. Players are being paid in full and all the games are being broadcast on television, as they always are.

It is starting to become unnerving. Football is going on very much as normal at the highest level. It’s as though nothing is wrong. And it’s as though nothing is wrong, because for them, nothing is wrong. It is as though the very reason football was ever played in the first place on a professional basis has been forgotten or easily brushed aside: fans in the ground – remember them?

Premier League and European football have been going on without us being present. Are we being missed by anyone? No, we are not. There is occasional talk about how nice it’d be if there were fans to see the big play-off games or cup final, in the same way it’d be nice to have some tomato sauce on your chips, but it’s far from necessary: the meal will be eaten and enjoyed without it.

These are, in any case, minority voices, and it is starting to feel so much like lip service because everyone is having a great time regardless. In real and practical terms, pretty much everything is happening as it always happens, albeit with tweaks to the European tournament organisation.

The media is charged with covering the games and without any games, they’d be unemployed. As such, football is probably more important to them than it is to us. Many people have already got out of the habit of football and are finding other things to do, but reporters and commentators owe their living to it. No wonder they’re going on like everything is normal.

And I’m sure you’ve read and listened to football observers who are now saying they’ve been enjoying the games on TV regardless of lack of crowds, perhaps fancying themselves as football aesthetes and students, merely studying the art of the game. I’ve even heard some say it is a purer version of the sport and they actually prefer it. Some may add a caveat that of course football isn’t as good without fans, but to be honest, I’m starting to disbelieve them, or wondering if they’re lying to themselves. People like it like this, or at the very least, have easily adjusted to it and when the whole of the football media is ‘doing’ football as normal like this, well, it becomes normal.

I spoke to my secret Premier League player this weekend. I’ve talked to him a few times across lockdown and he’s told me that he is actually now enjoying playing, that it’s less pressure, and says while it doesn’t quite get the blood pumping without thousands roaring you on, “it’s still football and I like playing football.

“You just go on autopilot and play. It’s all we’ve ever done, so it comes easy. If we always played like this, it wouldn’t bother me at all,” he said.

Considering it is supposed to be a football crisis, It doesn’t look much like a crisis for the top flight or its clubs, does it? It is for the non-playing staff who’ve been laid off and lower down the pyramid it clearly is, perhaps for many, a terminal crisis. But in the Premier League, it just isn’t.

Remember when Burnley were said to only have four months of money left? They’re still around. Is any Premier League club on the verge of bankruptcy? Nope.

Remember when clubs furloughed staff because they might go bust without TV money and matchday income and then unfurloughed them because it looked bad (except for Mike Ashley at Newcastle, who already looked bad and so didn’t care)? Have any collapsed? No.

Remember how clubs wanted players to take a wage cut or deferral to help them survive and the PFA kicked back and said you can whistle for that, pal, the billionaire club owners can afford to keep paying our wages and in full, thank you very much? Well it turns out the PFA were right. Owners could. And they have (though the PFA’s attitude to wage caps will choke the life out of lower-league football). No-one has gone unpaid. Very few took a cut or deferral.

It is starting to feel like the last five months have all been one big Premier League charade or deception. There has been a lot of crying wolf; there must have been because, look, here it all is once more, virtually unchanged. The new season’s fixtures will be out in a couple of weeks, just a month late, and off we go again, still crowdless.

Remember when #playerstogether was formed? How we all applauded their generosity for donating a reported £4million to NHS charities and sticking it right up the bracket of that serial truth-distorter, Matt Hancock? It was popular and it put to bed the uncomfortable feeling that footballers were accruing vast wealth while not even playing, at a time of a national crisis, when the country was being held together by virtue of the graft of some of the lowest paid in society. Once the £4million donation was announced, that rather inconvenient, awkward, conscience tweaking matter was never mentioned again.

But the total wage bill for the Premier League is £2.9 billion pounds. A £4million donation is 0.13% of that. For perspective, if you’re on the average wage of £28,000 per year, that’s the same as giving £36.40 to charity in a year; about 9p per day.

While that 0.13% doesn’t represent the entirety of what every single Premier League player might donate to charity – of course it doesn’t – that’s not the point. #playerstogether was sold to us by football media and by the game itself as A Generous Thing To Be Admired. If your 9p per day donation was painted that way, would it be a fair judgement, or is this another deception? In the same way clubs were not especially skint, #playerstogether wasn’t that especially generous.

When it comes to the Premier League, the paying fan, now unable to attend, has been very quickly disenfranchised and pushed to the media margins as less important than, well, absolutely everything else. The pretence has dropped. We already knew that financially; fans could be let in for free and clubs would barely suffer any financial distress. We knew that if Newcastle United hadn’t bought Joelinton and had played to an empty stadium for a season they’d have been £16 million better off. We knew that Bournemouth took £5million per season from fans and £130million typically from the Premier League.

Fans haven’t been financially important for years, and now, they have been made entirely superfluous. Premier League football really doesn’t need us. It’s ended the love affair, filed for divorce and is seeing other people. The in-ground supporter as a concept has been effortlessly bypassed. Players are being paid, they’re playing football and loving it, their life is normal or better. TV and radio are all working fine; the papers are full of football. Everyone is happy.

The clubs are not missing our money much, the TV companies are still coughing up to show the games, so who needs the dirty, grunting public? Without us clubs don’t have to pay for policing and they can lay off all those matchday staff and give the money to players instead.

Plans are in place to play a whole season this way, or at best to radically diminished crowd numbers, but to hear and see the Premier League, its propagandists and promoters, to hear and see all of football media, we will barely notice any difference, so complete has the change been from the People’s Game to the game without people. If they could make the crowd noise more responsive to the action – and they will – the wholesale disposal of fans will be complete. Will anyone even notice?

Perhaps we should just not bother going to Premier League games ever again, even when allowed to. Clearly, they have no need for us. Clearly, they’re all happy without us being there and happier still if we just pay to watch on TV.

Our gate money and attention will be far more appreciated and is much more needed lower down the pyramid. Let the elite play with themselves for themselves and for the media which depends on them, while we go back into the real world and watch football played by people who do really need our support. The Premier League has told us it doesn’t love us, doesn’t need us and will get on without us. Fair enough. We never loved you anyway.

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Re: Football's Magic Money Tree

Post by randomclaret2 » Mon Aug 10, 2020 5:35 pm

Is John Nicholson not part of "the media which depends on them " ?

Chester Perry
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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 8:03 pm

randomclaret2 wrote:
Mon Aug 10, 2020 5:35 pm
Is John Nicholson not part of "the media which depends on them " ?
you are right - his contribution certainly a dichotomy

Chester Perry
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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 8:11 pm

This academic article - COVID-19 and the solidification of media’s power in football by Argyro Elisavet Manoli makes an interesting follow up to that latest effort from John Nicholson

https://www.tandfonline.com/doi/full/10 ... 20.1792802

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Re: Football's Magic Money Tree

Post by Duffer_ » Mon Aug 10, 2020 8:26 pm

I have spent the vast majority of lockdown working from home as part of a relatively large team. It only works as well as it does because relationships were formed prior to lockdown. In some ways we are in stasis and I question our ability to adapt to fundamental changes in key personnel. And so it is with football without fans in stadia. The passion, the sounds, the sights, the smells are in our memory banks. We can survive on memories for so long but the next generation is not being blooded and there is a risk that a sizeable number of them never will be.

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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 8:35 pm

Tariq Panja in the New York Times with a story about how one Brazilian family owned commodities business has extended it's remit to include very young footballers with potential - the ugly side of Football's Magic Money Tree.

A Brazilian Soccer Mine Strikes Gold at Last
Renan Lodi’s arrival at Atlético Madrid has fulfilled his soccer dreams, but it also produced a payday years in the making for the scouting business that discovered him at age 13.

Renan Lodi’s play in his first year at Atlético Madrid has quickly justified his multimillion-dollar transfer fee.Credit.../EPA, via Shutterstock

By Tariq Panja - Aug. 9, 2020

CURITIBA, Brazil — In many ways, there is nothing extraordinary about Renan Lodi. A defender at the Spanish soccer club Atlético Madrid, Lodi is among the hundreds of Brazilian players who have crossed the Atlantic to play for European clubs in elite competitions like the Champions League.

More than 50 Brazilians, in fact, have played in the final. Lodi, 22, hopes to join that group later this month, when Atlético Madrid and seven other top teams gather in Portugal for the pandemic-delayed completion of this year’s tournament.

But while Lodi is still three wins from lifting the trophy, his European odyssey has already proven profitable for the company that discovered him at an out-of-the-way soccer school when he was 13. It has also validated a curious business project built around early investments in a precious, and plentiful, Brazilian export: soccer talent.

Since the 1970s, the Stival family has run a successful food supply business, one of the biggest of its kind in southern Brazil, from the southern city Curitiba. About 15 years ago, the family turned its attention to soccer. Like millions of Brazilian families, the Stivals are passionate fans of the game. But they could not help but notice how soccer players had increasingly become commodities, bought and sold for millions of dollars, just like the tons of beans, rice and grains that the Stivals traded every week.

If players had become commodities, the Stivals reasoned, surely they could find a way to make money trading them, too.

“The idea was to invest in this business because Brazil always makes money in this business,” Rafael Stival said in an interview last year, four months before Lodi joined the exodus of more than 300 soccer players who swapped Brazil for overseas leagues in 2019.

Sitting in his office at Trieste Futebol Clube — the amateur team in Curitiba that serves as the base for his soccer interests — Stival, a burly man with dark hair and a rich baritone voice, described how after early hiccups and countless errors he had fashioned a business out of scouring Brazil for the youngest talents, nurturing them briefly at Trieste and then getting them signed by the country’s elite professional clubs at the earliest opportunity.

To Stival, who runs the family’s soccer operation, investing in young players is a long-term bet, a process he likened to planting seeds that will one day grow into fruit-bearing trees. And Lodi is his biggest success to date.

Spotted in 2012 by one of Stival’s scouts at a soccer school in the interior of São Paulo state (population: 44 million), Lodi, then 13, was invited to travel to Curitiba for closer inspection. He performed well enough to be signed to Stival’s amateur program before moving on to live at the training center of Athletico Paranaense shortly after his 14th birthday.

Last summer, at 21, he made the move to Europe, in a deal that was notable for its size (16 million euros, or just over $18.8 million) but also for its destination, Atlético Madrid, one of the continent’s best clubs.

In an interview from Spain in August, Lodi said he remembered those early days in Trieste well: the loneliness, the fear, the nightly calls with his father during which he would beg to come home.

But he also remembered how he ate better at Trieste and, later, Paranaense than he ever had at home, and also how his soccer skills were always about more than a professional career. His feet would determine the future for an entire family mired in poverty, something that even a 13-year-old could understand.

“I always put that goal in my head, you know?” he said after a recent training session. “I said to myself: ‘I’m going to be the father of the family. I’m going to chase my dreams, and I’m going to try to give them a better condition ahead in the future.’”

Last year’s transfer fulfilled that dream, but it also finally produced a major payday for Stival, who got a 30 percent cut (about 4.8 million euros, or about $5.6 million) of the transfer fee.

Payments like that are the key to Stival’s soccer ambitions, and the reason he signs dozens of young players and then quickly moves them on to one of the bigger clubs with which he has had development agreements: the more seeds he plants, the better his chances of seeing one bear fruit.

Lodi’s transfer to Madrid represented only the second transaction of a player discovered by the Stival operation since it started in 2005. But in that one deal, Rafael Stival said, the family recouped more than half of its total investment.

In an interview earlier this summer, Stival said he expected the rate of sales to grow now that dozens of his recruits had moved up the soccer food chain. More than 100 players who were once on Trieste’s books are now registered with professional teams, with most at Athletico Paranaense or the Rio de Janeiro giant Flamengo. Both clubs have had partnership agreements that gave them the first right of refusal on Trieste players.

Stival has a separate agreement with Trieste, a successful amateur team set up by Italian immigrants in 1937. In exchange for investing a considerable sum in its facilities, his family has the right to use the club as a base for his soccer business for 20 years, a contract that expires in 2025. That investment also allows Stival to get a cut of the transfer fees because, under international transfer regulations, only teams can profit from player sales.

Still, there has been a learning curve. Stival’s initial business plan focused on older boys, those who needed just a little extra focus to get them ready for professional contracts. It did not take long for Stival to realize the plan’s biggest flaw. “They would go missing at night,” he said, letting out a deep breath. “A total mess. We had to learn.”

His revised plan — turning his focus from 18- and 19-year-olds to boys as young as 11 or 12 — would require more patience.

“When we entered we thought we would make money within two years,” Stival said. “Now it’s 14 years and we haven’t recovered our expenses yet.”

Sitting beneath seven large maps of Brazilian states, Stival explained how the players are discovered. About half a dozen scouts — including Stival — go on monthslong missions deep into Brazil’s interior and watch hundreds of players at a time. Tips about local prodigies come from a network of local coaches, schoolteachers and others, a grapevine that has led Stival to some of the most remote parts of the country, including, on at least one occasion, an Indigenous reserve.

The best players are invited to Trieste for a trial that can last as long as two weeks. Local laws and age restrictions designed to prevent the trafficking of children mean the majority of the players cannot stay on the club’s campus, so families immediately face difficult decisions. Some move hundreds, or even thousands, of miles to accompany a child, lured by the hope of the life-changing opportunities that could follow if the trial is a success. But the plan, at least from Stival’s side, is always for a short stay.

“Our idea is to discover talent,” Stival said. “We don’t want to keep a player from 10 to 20. We want to get him into a club and continue. A kid who is 10, 11, 12, 13 — who has conditions to live close — we will take.

“It’s very quick here: Every day that they spend with us is a cost to us.”

For five years, Trieste had an exclusive agreement with Athletico Paranaense, one of two top professional teams in Curitiba, a city of 1.8 million. More than 60 players, including Lodi, had moved through Trieste to the Athletico facilities, now among the best in Brazil, before the contract was abruptly ended in 2018. Athletico Paranaense, its president said in a WhatsApp message, had simply decided to bring the bulk of its scouting and youth development in-house.

Stival’s disappointment was short-lived. Less than 24 hours later, he said, officials from Flamengo arrived in his office to talk terms. A deal was signed, and now Trieste’s best prospects flow to Rio instead.

Last year, however, disaster struck. A fire ripped through a temporary dormitory at Flamengo’s training facility that housed a clutch of young hopefuls, killing 10, including three boys who had come through Trieste. The deaths brought a belated focus on how Brazil, the world’s biggest exporter of soccer talent, cares for the thousands of boys and young men who enter the soccer pipeline hoping to overcome the odds.

Disturbing examples quickly emerged at other clubs — cramped dormitories, dangerous conditions, poor supervision — and the authorities closed down the worst offenders and promised more oversight.

In Trieste, though, something strange happened. Hopeful parents, now aware of the club’s link to Flamengo’s youth academy, began to get in touch. Could the club, they asked, run the ruler over their sons, too?

Stival could only shake his head at the time. A year later, with the income from Lodi banked, Trieste’s operations continue to expand. Flamengo has recruited more than 30 of Stival’s players to its youth ranks in the last 18 months, and those who can’t find a place there are sent elsewhere. His investments, he hopes, may yet produce another big payday.

On a recent afternoon, Stival switched on his television and came upon a broadcast of Atlético Madrid playing a Spanish league game. Working up and down the left flank was Lodi, now a rising star, living the dream of countless Brazilian teenagers. For the Stival family, he represented something else: proof of concept — a successful business plan in the form of a rampaging left back.

Should Lodi and Atlético make a deep run in the Champions League this month, Stival may see another return on his investment. As part of Lodi’s sale last year, Athletico Paranaense negotiated a bonus payment of 3 million euros (about $3.5 million) based on his performances in Spain.

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Re: Football's Magic Money Tree

Post by Chester Perry » Mon Aug 10, 2020 9:36 pm

SportsBusiness.com asks the question, to a panel of specialists, that many sports organisations are pondering

Will rights-holders emerge from Covid-19 lean and mean or broken and weak?
Tom King, Asia Office - August 10, 2020

- Covid-19 has hammered rights-holder budgets
- Industry insiders expect little short-term relief
- But stronger rights-holder products for fans and partners may emerge

Covid-19’s effect on sports rights-holders globally has been swift and brutal. There have been job losses and swingeing budget and salary cuts, with likely more to come.

Business downturns can produce positive outcomes in the longer term. Greater efficiencies can be found and products and services can be improved, resulting in greater profitability in the years of recovery. Covid-19 is accelerating changes that businesses were already making, particularly towards greater use of digital technology, which could also produce beneficial effects further down the line.

But to see these positive outcomes, the businesses must first survive. SportBusiness asked sports industry insiders what they think the prospects are for rights-holders, and what must be done to emerge from the crisis lean and improved, rather than damaged and weak.

Dr Adam Karg – associate professor and director, sport innovation research group,
Swinburne University of Technology
No doubt there will be a restriction in operating capacity, which means reductions in the size of organisations and resources available for sports rights-holders to conduct their operations. Economically, already we are seeing restrictions in broadcast rights, refocus and recasting of sponsorship agreements and corporate ticketing and initial impacts on fan ticketing revenue streams.

Corporate support flows to sport under a mandate of ‘organisations spend when they have confidence that individuals will spend’. The general downturn in the economy is therefore problematic for the short-to-medium term for rights-holders.

That many leagues at the professional level have been able to maintain some operations, even in closed stadiums and with high costs, has been critical for short-term sustainability and survival, but it won’t be until years down the track, maybe 2023-24, that we see the full revenue mix anywhere near pre-Covid levels.

For sport at lower levels, including community sport, things are dire, with likely very high impacts on their revenue streams. Closure of smaller teams and leagues, and reduced capacity for organisations and governing bodies, presents a real threat to the sporting system.

That sport provides such wide community, social and physical benefits at this level hopefully means support will be prominent from both governments and private sectors.

In recovery, what we will need to see is a focus on efficiency and innovation from rights-holders – so better utilising and building collaboration across the sport value chain to drive solutions and outcomes which can be shared across organisations and teams, or be applied in cost-effective manners. This is critical for rights-holders and fan partnerships.

Sam Goodwin – managing director, CSM Australia
There are two ways to look at this question. Sports rights-holders whose sponsors have remained loyal have 100 per cent had to improve their servicing, value and engagement. They have had to be more agile and creative with their assets.

Consequently, increased player access, digital initiatives and improved storytelling have all been embraced by rights-holders keen to retain their existing partners. So any brands getting into sports sponsorship at this time can expect a significantly improved experience as the majority of rights-holders have really stepped up.

However, due to the effects of Covid-19, many sponsors have had no choice but to drop their partnerships, to cut marketing and activation spends, and rights-holders are certainly feeling this pinch. As confidence returns to elite sport we will find an environment in which the value of rights has effectively reset.

The number and variety of properties available will see sponsorship values fall and brands potentially looking to establish a more diversified portfolio of rights for the same budget they might previously have paid for one deal. In addition, the phasing out of fixed sponsorship packages, which was already happening pre-Covid-19, has accelerated, so every partnership should be uniquely tailored to the brand.

All in all, while rights-holders have improved, they will still find it tough going for some time, while brands will currently get excellent value for their investments. Nevertheless, the need to prove to brands that sponsorship is a sensible spend of marketing dollars has never been greater, so demonstrating how they can leverage assets to achieve meaningful impact and measurable results will continue to be of key importance.

One further thought is on the role of agencies within this. Both rights-holders and sponsors have had to cut costs and some of that impact has hit internal rights sales and sponsorship teams. With a lot of financial uncertainty impacting the whole economy, businesses will be hesitant to add to their head count, making the use of agencies the ideal way to meet objectives without the long-term commitment of recruiting.


Richard Thomas – chief commercial officer, New Zealand Rugby
At New Zealand Rugby, we are excited and optimistic about what the future looks like. Sports rights-holders can emerge from Covid-19 leaner and improved if they take the time to think about what their core purpose is and how they orientate to that.

Critically, they will have to focus more on their customers and design with customers at the core of their future offering.
Covid-19 forced us to run a leaner, New Zealand-only version of Super Rugby this year – dubbed Investec Super Rugby Aotearoa – featuring the five New Zealand teams and the competition has been a huge success, with massive growth in viewership, attendance at games and social media engagement.

While it has been a tough time for all sports rights-holders, we feel that we are emerging from this period with a tighter focus and we are clear and motivated by the opportunities for change that Covid-19 has given us.

Torrey Dorsey – head of sales, Asia Pacific, SailGP

The current pandemic has given us at SailGP the opportunity to focus on important initiatives to make both our racing and broadcast even more attractive. As part of this, we have been evaluating, refining and redefining our offer to our commercial partners, representative teams, media channels and our host cities – both existing and prospective.

The addition of IMG and its global resources and expertise, through our partnership with Endeavor, has added a new dimension to SailGP. The postponement of Season 2 has allowed us to spend a significant amount of time together; to evaluate the successes and shortcomings of our inaugural season, which is an exercise that would have been difficult to execute in such detail if we were actively competing.

The SailGP narrative will continue to reinforce our pillars of ‘sustainability’, ‘innovation’, ‘technology’ and ‘entertainment’, but there are also plans to transcend sport; to present a more purposeful proposition that addresses issues beyond the field of play for a greater societal impact.

In short, we will continue to strive to be a leader in sustainable practice. From our ambitious goal of carbon neutrality by 2025, through to our use of innovative technology, such as the remote set-up of our broadcast production that was implemented from day one, to the Tesla solar power-walls that provide temporary power on-site and charge the batteries of our revolutionary race boats to ensure they are truly powered by nature. We will continue to look at how we can accelerate change to a clean future, powered by nature.

The coronavirus pandemic caused an unprecedented sequence of events, with the effects still at play. But, it also presented an opportunity for SailGP, and all in the sports and entertainment industry, to redefine who we are; and to re-emerge leaner and stronger than before – and with increased purpose.

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Re: Football's Magic Money Tree

Post by Chester Perry » Tue Aug 11, 2020 8:26 am

If you have been wondering why the Premier League prize money has still not been announced this may have something to do with it - from the Mail

Premier League in China TV battle as holders of their most lucrative overseas deal continue to withhold £160m payment that was due in MARCH - with potentially seismic ramifications for club finances
- Premier League is locked in a legal dispute with its Chinese broadcast partners
- Suning Holdings have withheld a payment of £160m due in March this year
- The top flight have retaliated by rejecting their offer of a three-year extension
- The stand-off could have big ramifications for all 20 Premier League clubs
By MATT HUGHES FOR THE DAILY MAIL

PUBLISHED: 22:31, 10 August 2020 | UPDATED: 07:37, 11 August 2020

The Premier League are locked in a legal dispute with their Chinese broadcast partners that could cost clubs hundreds of millions of pounds in lost television income.

Sportsmail can reveal that rights holders Suning Holdings have withheld a payment of £160million that was due in March, with the Premier League retaliating by rejecting their offer for a three-year extension to the contract to cover the 2022-25 seasons.

The stand-off has potentially seismic ramifications for club finances as the Chinese TV deal is the most lucrative in the world outside the UK, with Suning agreeing to pay £564m for the current 2019-22 cycle for the right to broadcast Premier League games on their digital channel, PPTV.

That deal represented a 12-fold increase on the previous Chinese TV contract with Super Sports Media and the Premier League were budgeting for another significant rise for the next three years, which it was anticipated would help offset the flattening value of domestic TV rights.

The Premier League claim that Suning are in breach of contract following their failure to pay, which is believed to primarily have resulted from the sporting shutdown due to coronavirus but may also have a political dimension.

The clubs discussed the issue at last week's shareholders' meeting and are considering a range of options, including demanding an immediate payment, negotiating a revised payment schedule or terminating the deal.

Suning have developed into huge players in the global TV market in recent years having also bought the rights to the Champions League, FA Cup, La Liga and Bundesliga matches in China, as well as a controlling interest in Inter Milan four years ago.

The potential loss of income has been compounded by the Chinese government's decision to cancel international sports events for the rest of the year, with the exception of Olympic trials, so the lucrative summer tours regularly undertaken by Premier League clubs have been scrapped this year.

There is also a political dimension to the dispute which is uncomfortable for the Premier League, who are in danger of being caught in the crossfire of escalating tensions between the British and Chinese governments.

In a stark message last month, the Chinese ambassador in London accused Britain of interfering in the country's internal affairs and warned of consequences following Boris Johnson's pledge to offer UK residency to up to 3 million Hong Kong residents.

The Prime Minister's decision to block Chinese technology giant Huawei's involvement in the UK's new 5G network has also soured relations.

Over the past months, sports broadcasts by Chinese rights holders appear to have been dragged into such political disputes.

State broadcaster CCTV Sports caused a stir last month by switching their coverage of Liverpool's 5-3 win over Chelsea to a less viewed digital channel.

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Re: Football's Magic Money Tree

Post by Chester Perry » Tue Aug 11, 2020 6:12 pm

The Newcastle/Saudi takeover is just getting silly now - from the Prime Minister saying the Premier League should make a statement (he has a long relationship with one of the Reuben Brothers to claims that the Premier League could be sued by one or more of the parties involved - what ever happened to agreeing to a confidential process and I presume agreeing to fulfil all the Premier Leagues requirements - this from the Telegraph this evening

Mike Ashley could sue Premier League over collapse of Saudi investment fund-led takeover of Newcastle
TOM MORGAN AUGUST 11, 2020

The Premier League is vulnerable to legal action from Mike Ashley for effectively derailing the Newcastle United takeover, intermediaries in the collapsed deal believe.

Those close to the process believe England's top tier is in an "impossible position" as chief executive Richard Masters comes under sustained pressure to explain why the league's directors and owners' test hit a four-month impasse.

The league has consistently maintained privately that it took an "objective" approach to the proposed £300 million deal, but the Saudi sovereign investment fund behind the takeover is said to feel the delay was a thinly-veiled attempt to make the takeover impossible. The Public Investment Fund (PIF) eventually walked away after being unable to satisfy the league that Crown Prince Mohammed bin Salman was not involved.

Ashley remains desperate to revive the deal, but PIF would now consider returning to talks only in the unlikely event that the league provides written assurances that it was finally ready to let the deal go through.

As hopes fade, however, those closest to the negotiations say the other option is for Ashley to pursue a potential damages claim against the league, given he is said to have received assurances from it in April that there were "no red flags" to the proposed takeover.

It is an unprecedented situation for the Premier League, which neither passed nor failed the prospective buyers, but, with MPs and fans groups now demanding answers, Masters is under mounting pressure to explain on the record why the process was so drawn out. Those involved in the deal believe such a statement remains "hugely unlikely" to state on the record which way the process was heading due to the legal ramifications.

"It is becoming an impossible situation for the PL," said one source close to talks, who cited the case of BeIn, the Qatari broadcaster which was vehemently opposed to the deal due to Saudi Arabia's failure to prevent the BeOutQ piracy scandal. "The league is desperate to hang on to keeping their process secret because they have Ashley's lawyers circling in one corner and BeIN Sports in the other."

PIF, Amanda Staveley and the Reuben Brothers withdrew their offer to buy the club on July 30, prompting thousands of fans, the Newcastle United Supporters' Trust (NUST), the Independent Football Ombudsman and at least 40 MPs to demand answers.

Ashley previously said he remains "100 per cent committed" to the sale, with the club's managing director, Lee Charnley, issuing a brief statement a day after the collapse of the takeover to suggest the deal may still be resurrected.

The Premier League has already offered independent arbitration, rejected by the bidders, who say their ownership structure - with the PIF an independent investment vehicle as set out in its charter - and business plan were clear.

There have been renegotiations over the sale price, which was just above £300m having originally been agreed at £340m before the coronavirus pandemic struck, but this was not a deal-breaker and relations between the bidders and Ashley remained good. The Premier League declined to comment.

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Re: Football's Magic Money Tree

Post by Chester Perry » Tue Aug 11, 2020 6:29 pm

Less than 2 months after a £30m rights issue, West Ham mortgage all the clubs assets to get advance cash - will probably be using broadcast monies to repay, but as they have not used a UK registered bank such as Macquarie (perhaps due to credit worthiness) the assets are the liability not the central payments.

https://twitter.com/KieranMaguire/statu ... 9507471362

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Re: Football's Magic Money Tree

Post by claretandy » Tue Aug 11, 2020 6:57 pm

Look like we will receive our full amount of TV money with no rebates due this season.

https://www.thetimes.co.uk/edition/spor ... 1597168086

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Re: Football's Magic Money Tree

Post by claretandy » Tue Aug 11, 2020 7:06 pm

claretandy wrote:
Tue Aug 11, 2020 6:57 pm
Look like we will receive our full amount of TV money with no rebates due this season.

https://www.thetimes.co.uk/edition/spor ... 1597168086

The Premier League clubs are to receive their full prize money payout for last season after agreeing to delay any reductions caused by the Covid-19 crisis.

The 20 clubs have decided that the Covid-related cuts to TV income, which could total £330 million via rebates to broadcasters, will be spread out over future seasons and will not affect the most recent campaign.

They have also agreed to another advance of solidarity payments to EFL clubs, following the £125 million paid in April that had been due this month, but stopped short of a bailout of the lower-league teams. The decisions were confirmed at last week’s annual general meeting of Premier League clubs’ chief executives and chairmen.

It means that Liverpool will receive a record sum of about £175 million in prize money and TV earnings from winning the title. If the rebate had been applied to last year’s earnings it would have seen Liverpool’s prize money drop by £21 million, according to analysis by the football finance expert Swiss Ramble.

The Premier League usually announces its payments to clubs in the week after the end of the season but has so far yet to do so.

Sources say the decision to “delay the pain” of the pandemic was confirmed at last week’s AGM, not least because negotiations are still continuing with many of the Premier League’s 55 domestic and broadcast partners around a rebate for the season being disrupted.

Last season was the first of the three-year 2019-22 TV deal cycle, in which the formula for allocating TV money was changed in a way that benefits the top clubs. For the first time a proportion of overseas TV money will be allocated according to where a club finishes in the Premier League table, rather than it all being split equally between the 20 teams.

In 2018-19, then runners-up Liverpool and champions Manchester City both earned just over £150 million, and are in line to see an increase of between 12 and 15 per cent for last season.

Meanwhile, Premier League chiefs believe a delayed £160 million payment from its Chinese broadcast partner Suning is due to Covid-related financial issues rather than political problems at government level. Suning also has the rights to Spain’s La Liga but has no payments there outstanding.

Suning is one of the league’s most important overseas broadcasters after signing a $700 million deal (£550 million) in 2016 for the 2019-22 rights, most of which are shown on its pay-TV platform PPTV. That deal alone is worth an average of £9.2 million to every Premier League club each season.

There were fears that the English league may be dragged into the political dispute over the British government’s decision to ban Huawei Technology from the UK’s 5G network and its opposition to the new security laws imposed in Hong Kong. In the final week of last season, Chinese state broadcaster CCTV, which has the rights to show some games, appeared to drop English top-flight matches from its main sports channel to a minor channel, CCTV5.
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Re: Football's Magic Money Tree

Post by Chester Perry » Tue Aug 11, 2020 7:08 pm

claretandy wrote:
Tue Aug 11, 2020 6:57 pm
Look like we will receive our full amount of TV money with no rebates due this season.

https://www.thetimes.co.uk/edition/spor ... 1597168086
I must say that I find this surprising - but we should benefit enormously this year

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Re: Football's Magic Money Tree

Post by claretandy » Tue Aug 11, 2020 7:21 pm

Chester Perry wrote:
Tue Aug 11, 2020 7:08 pm
I must say that I find this surprising - but we should benefit enormously this year
Be interesting to know how it's going to work, are future promoted teams going to receive less, whereas the 3 relegated clubs haven't lost anything ?

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Re: Football's Magic Money Tree

Post by Royboyclaret » Tue Aug 11, 2020 7:40 pm

claretandy wrote:
Tue Aug 11, 2020 6:57 pm
Look like we will receive our full amount of TV money with no rebates due this season.

https://www.thetimes.co.uk/edition/spor ... 1597168086
Interesting development from the PL. However, the fact remains that the liability relates to the season just ended, that is 9 matches from '19/'20 season where the product did not meet with broadcaster's specified requirement. As such, if I were Financial Accountant at the Turf, provision would be made for the potential £17m cost in the accounts to year-end Jun'20.

As painful as that may be, simply to defer the liability to a future year when similar or more likely worse charges will affect us, would not be a prudent or sensible approach. We already know we are faced with a new season where games are likely to remain behind closed doors indefinitely, so for me, this reduction of some £17m to Turnover is far better allocated in the season to which it relates. These are unprecedented and uncertain times and simply to delay an inevitable liability in the financial accounts would not even be an option.

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Re: Football's Magic Money Tree

Post by ecc » Tue Aug 11, 2020 8:45 pm

Not sure where to post this but the French PM announced today that the date for allowing more than 5,000 people attend public events has been put back two months. Originally scheduled for August it will now be (as of today) end October.

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Re: Football's Magic Money Tree

Post by Chester Perry » Tue Aug 11, 2020 8:52 pm

ecc wrote:
Tue Aug 11, 2020 8:45 pm
Not sure where to post this but the French PM announced today that the date for allowing more than 5,000 people attend public events has been put back two months. Originally scheduled for August it will now be (as of today) end October.
Germans said something similar yesterday - it will be giving kittens to English clubs - - and your post fits right in here mate
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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 8:30 am

claretandy wrote:
Tue Aug 11, 2020 6:57 pm
Look like we will receive our full amount of TV money with no rebates due this season.

https://www.thetimes.co.uk/edition/spor ... 1597168086
@SwissRamble gives his estimated breakdown on what this means in GBP

https://twitter.com/SwissRamble/status/ ... 7385822209

as I said last night we appear to have done well from it - the estimate being £127.3m which I believe would give us over £150m revenue for the season (not the financial year)

I will also add that his thoughts on rebate are not necessarily the way I would expect them to be modelled by the Premier League - I expect them to reduce the different posts according to the monies rebated to Domestic and Overseas broadcasters and then apply the distribution rules as normal (as I have stated previously.

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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 8:58 am

the Guardian's Football Weekly Podcast looks at Club ownership, soft power and human rights

https://www.theguardian.com/football/au ... all-weekly

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Re: Football's Magic Money Tree

Post by Paul Waine » Wed Aug 12, 2020 12:40 pm

Royboyclaret wrote:
Tue Aug 11, 2020 7:40 pm
Interesting development from the PL. However, the fact remains that the liability relates to the season just ended, that is 9 matches from '19/'20 season where the product did not meet with broadcaster's specified requirement. As such, if I were Financial Accountant at the Turf, provision would be made for the potential £17m cost in the accounts to year-end Jun'20.

As painful as that may be, simply to defer the liability to a future year when similar or more likely worse charges will affect us, would not be a prudent or sensible approach. We already know we are faced with a new season where games are likely to remain behind closed doors indefinitely, so for me, this reduction of some £17m to Turnover is far better allocated in the season to which it relates. These are unprecedented and uncertain times and simply to delay an inevitable liability in the financial accounts would not even be an option.
Hi Royboy, maintaining the full tv money this season is a sensible mitigation of the covid-19 impact on Premier League clubs. Of course, all clubs are also missing out on match day income - which hits some clubs more than others. If future seasons tv monies are rebated to compensate the rights holders, then I don't think that is necessarily a liability of the 20 clubs that were in Premier League in 2019/2020 season. It's more likely settled by rebating monies due to Premier League for future seasons - and then paid by the Premier League to the 20 shareholders/clubs participating in each of those seasons. I can see a scenario where the rebate doesn't result in tv fees reductions in 2020/21, especially if fans are significantly delayed in attending the games. Again, clubs will be losing out on match day income, if that is the case.

Why this way? TV rights holders need a "strong product" to attract their viewers/subscribers. So, best to spread the rebate across future seasons, rather than let the clubs take a hit on both tv money and match day income.

Just my thoughts. I've no "private insights" into Premier League thinking.

EDIT: We should know more when financial accounts are published for 2019/2020 in April 2021. Maybe Premier League will release some info before then. Perhaps along with the announcement of the season's prize money.

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Re: Football's Magic Money Tree

Post by ecc » Wed Aug 12, 2020 3:01 pm

"Germans said something similar yesterday - it will be giving kittens to English clubs - - and your post fits right in here mate"

Many thanks, Chester.

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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 4:44 pm

After several years of search Derby have found a new Investor willing to put £30m into the club - it is not for shares - it is a loan from Michael Dell (he recently did something similar for Southampton - from the Telegraph

Derby County receive £30m cash injection from American billionaire
TOM MORGAN AUGUST 12, 2020

Derby County have received a major cash injection borrowed against the club's assets from a New York investment bank belonging to American billionaire Michael Dell.

Dell is the owner of MSD Capital and records on Companies House confirm a loan - believed to be in the region of £30 million - was registered last week.

The Daily Telegraph understands it is the second loan agreed with Derby chairman Mel Morris, who has been seeking additional funding for over two years.

He was previously in talks with Henry Gabay, a London-based businessman, but a deal has stalled due to a number of factors including the sacking of former club captain Richard Keogh and an English Football League charge against the club for breaking spending rules in January.

Dell was partly involved in a potential takeover at Sunderland last year, with three investors from MSD Partners instead loaning £12m to the holding company of Black Cats owner Stewart Donald.

It is understood that Dell and Derby are talking about a range of financial arrangements, which could include a significant loan, investment or takeover.

Dell was listed as the 25th richest man in the world in Forbes last year and has also held talks with a number of other clubs in England outside the top tier.

Derby are among many clubs on a financial knife-edge in the Championship post Covid-19 and the club’s willingness to take out a significant loan at commercial rates will prompt questions over how much spending power Morris still has personally.

The loan comes as the EFL is under renewed pressure from furious Championship clubs to resolve the charges hanging over Derby.

-----------------------------------------------------------------------------------------------------------------------------------------

Of course with the club no longer owning the ground the assets used for security are a jumbled lot - you can find them here

https://beta.companieshouse.gov.uk/comp ... ng-history

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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 4:46 pm

Meanwhile Leicester show the value of a high Credit rating ast they facto TV income through to January 2022 to Macquarie (the Antipodean Vampires as they are also known apparently)

https://twitter.com/KieranMaguire/statu ... 1555585024

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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 4:56 pm

In many ways I am surprised that we haven't seen more of this following the Covid Impact and ongoing uncertainty - Valencia put the whole squad up for sale - from the Mail

Valencia 'put their ENTIRE SQUAD up for sale except Jose Gaya' as they feel the financial effects of missing out on European football and the Covid-19 pandemic
- La Liga side Valencia have reportedly made all of their squad available to bidders
- New coach Javi Gracia could field offers from Premier League clubs for his stars
- Leading prospect Ferran Torres moved to Manchester City for £37m on August 4
- Valencia missed out on the Champions League and have played without crowds
By BEN MILLER FOR MAILONLINE

PUBLISHED: 10:55, 12 August 2020 | UPDATED: 14:46, 12 August 2020

Valencia have alerted Premier League clubs by putting all of their players up for sale in a bid to balance the books, according to reports.

Winger Ferran Torres became the most high-profile player to leave the club when the 20-year-old moved to Manchester City for £37million last week, and other stars are now expected to follow suit.

The Liga side have confirmed that former Arsenal midfielder Francis Coquelin has moved to Villarreal in a deal that is expected to also see their rivals snap up Spain international Dani Parejo for a combined total of under £11.5million.

New boss Javi Gracia, who was appointed at the end of July, is said by Marca to have been told that any of his players could be sold.

The former Watford coach is reportedly keen to resist selling potential captain Jose Gaya, although Barcelona have been linked with the centre-back.

Valencia are feeling the effects of lost revenue after playing out the season behind closed doors as Covid-19 gripped Spain.

They will miss out on the riches of Champions League football for the first time in three years next season after finishing ninth in La Liga courtesy of an underwhelming campaign.

Fans protested against billionaire owner Peter Lim over a perceived lack of investment before former manager Albert Celades was sacked on June 30.

Celades suffered a run of only two wins in 15 matches earlier this year, crashing out of this season's Champions League at the round of 16 stage with an 8-4 aggregate defeat by Atalanta.

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Re: Football's Magic Money Tree

Post by Royboyclaret » Wed Aug 12, 2020 5:15 pm

Chester Perry wrote:
Wed Aug 12, 2020 4:46 pm
Meanwhile Leicester show the value of a high Credit rating ast they facto TV income through to January 2022 to Macquarie (the Antipodean Vampires as they are also known apparently)

https://twitter.com/KieranMaguire/statu ... 1555585024
This kind of financial transaction, gambling against future Broadcast revenues, seems almost a route of last resort and somewhat surprising that Leicester have chosen this path. So much uncertainty around particuarly overseas rights-holders with some of the smaller ones in danger of disappearing completely from the market. Really hope that this is never a path chosen by Burnley.

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Re: Football's Magic Money Tree

Post by Chester Perry » Wed Aug 12, 2020 5:20 pm

Royboyclaret wrote:
Wed Aug 12, 2020 5:15 pm
This kind of financial transaction, gambling against future Broadcast revenues, seems almost a route of last resort and somewhat surprising that Leicester have chosen this path. So much uncertainty around particuarly overseas rights-holders with some of the smaller ones in danger of disappearing completely from the market. Really hope that this is never a path chosen by Burnley.
As far as I am aware we are the only club in the Premier League that has not opened/extended a credit facility, factored against future earnings or taken out a secured loan in recent months

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Re: Football's Magic Money Tree

Post by Royboyclaret » Wed Aug 12, 2020 5:33 pm

Chester Perry wrote:
Wed Aug 12, 2020 5:20 pm
As far as I am aware we are the only club in the Premier League that has not opened/extended a credit facility, factored against future earnings or taken out a secured loan in recent months
Just recently, in a mutual arrangement with the bank, our arranged overdraft account was closed due to lack of activity over a three year period or so.

We really are a unique Club in that respect, but the dramatic effects of Covid-19 might be about to change all that.

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