Article Taxonomy: Football Finance

Articles and reports on financial issues within football – soccer – from The Political Economy of Football.

Should Celtic have splashed out?

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Would Celtic have avoided an early exit from the Champions League, and a failure to get a consolation place in the Europa League, if they had spent more on transfers?   Possibly, but an alternative view is that they have followed a prudent policy of living within their means.

A more fundamental question is how far a team can develop commercially and on the pitch within Scottish football.  But that is a question that has been asked for a long time and has never found an answer.

8 per cent of clubs in serious financial trouble

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Flat-lining attendances and rising costs are blamed for locking six English league clubs into a cycle of serious financial distress, a report issued today warns.

The Begbies Traynor Red Flag Alert Football Distress Report monitors the financial distress in football clubs every six months. The latest figures show that a total of six clubs (one in twelve) in the Championship and Leagues One and Two are facing ‘critical’ financial pressure at the end of October 2013. The number of clubs in serious trouble represents 8 per cent of the 72 clubs that make up the leagues.

Referendum result pleases Swiss clubs

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Swiss voters have rejected in a referendum by a majority of nearly two to one the so-called 1:12 proposal that would limit the salaries of top earners in a company to no more than 12 times the wages of the lowest-paid employee. The decision has come as a relief to leading Swiss football clubs.

Grasshoppers of Zurich and FC Basel criticised the proposal, worried that even more players would transfer abroad. Up to 50 sports stars and clubs officials in Switzerland in football and ice hockey earn more than 12 times their club’s lowest-paid employees.

New insurance package for star players

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An injury to a top player can be a nightmare for a club. It can affect team performance, final league position and revenue from prize money for the Premier League and Champions League. Finishing outside the Champions League places can cost a team more than £30m in guaranteed prize money alone.

A case in point would be the broken leg suffered by Arsenal striker Eduardo da Silva in 2008. Bought for £12m, the injury put him out of the game for nearly a year and he never regained his former sharpness. He was sold for £6m in 2010.

Why it pays to stay put

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Emmanuel Adebayor is in line for a £1.4million payment if he snubs a January move away from Tottenham. Even though he has been frozen out this season, the financial arrangements mean that he is likely to stay put.

Blades reduce deficit

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Sheffield United have significantly reduced their annual deficit, the club has announced. In a year when the club was taken over by Saudi Arabia’s Prince Adbullah bin Mosaad bin Abdulaziz, losses at Bramall Lane have been significantly reduced by more than £8m, according to the club’s annual accounts issued on Friday, November 22. United cut their wage budget by £4.1m and they made £3.1m on player trading.

£18m price tag on Charlton

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A price of £18 million has been agreed between Charlton’s current board and the property company which is set to buy the club, writes Toby Porter. The prospective new owners, whose identity has not yet been revealed, are also thought to be ready to take on the club’s £4million bank debts, plus £7m owed to former directors when the Addicks return to the Premier League.

Leeds bid turned down

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Lucas Radebe has tonight confirmed that he is part of a consortium bidding to buy a shareholding in Leeds United. The former player has responded to claims that he is involved with a group who failed last week with a £7million offer for a controlling interest in the club.

Current Leeds owner GFH Capital rejected the bid out of hand, describing it as ‘risible’, and played down speculation that former player Radebe was backing the approach.

Charlton takeover close

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Charlton Athletic are in advanced talks with a multi-million pound British property company over the sale of the Championship club. Sources close to the Addicks have revealed that an investment company is on the verge of completing the deal to take total control of the Championship club. The purchase figure is unlikely to be revealed during the process.

It is understood that representatives of the buyer visited The Valley and Charlton’s Sparrows Lane training ground in New Eltham this week and have completed their due diligence.

Could QPR face record fine?

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It is being claimed that QPR could face a record fine under financial fair play regulations.   Given their inflated wage blll, they could announce losses of £80m next spring for 2012-13.   This would lead to a fine of £62m which would wipe out their additional Premier League income if they were promoted.  Even if the losses were £60m, they could be fined £40m.