They may be one of the biggest spending clubs in Europe and their players will make up the bulk of the Spanish team in tonight’s world cup clash with Germany, but Barcelona are seeking a €150m loan to pay player and staff wages.
They may be one of the biggest spending clubs in Europe and their players will make up the bulk of the Spanish team in tonight’s world cup clash with Germany, but Barcelona are seeking a €150m loan to pay player and staff wages.
The move was taken by new club president Sandro Rosell. He emphasised on the club’s website that the club was not bankrupt, but announced an austerity policy which would impose savings in ‘unnecessary’ areas (which raises the question why the spending was taking place in the first place). He admitted that the club faced cash flow problems which is another way of saying it is not far off being insolvent.
Last week the club claimed to be the biggest sports team by revenues, saying sales for the 12 months to June 30 rose 16 per cent to €445.5m. However, the Spanish economy is in crisis and there is a particular concern about money the club is owed by its TV rights partner. Last month Mediapro announced it was seeking bankruptcy protection over a dispute with a pay-TV company.
The seven year contract worth €1bn runs until 2013. According to the club’s website Mediapro said that the money would be paid. However, it was also admitted that, unlike deadly rivals Real Madrid, there was only a verbal guarantee of payment which has little value in legal terms. On the face of it, it looks as if someone has made a big mistake.
It was also admitted that one of the club’s players, Dmitro Chygrynskiy had been sold for €15m partly for financial reasons. None of this will please the fervent supporters of Barcelona, in particular in terms of their ability to compete with Real Madrid. This is one of the most well-developed football rivalries in Europe with its political undertones and fascinating to a neutral outsider.
The news will also be greeted with concern by Uefa which is an admirer of the mutual model of running a club like Barcelona which supposedly leads to fewer financial problems than the English model of ownership by wealthy individuals.