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Articles and reports on financial issues within football – soccer – from The Political Economy of Football.
The owners of football clubs sometimes have some unrealistic expectations about the price their club might fetch when they try to sell. However, the conditions apparently being attached to the sale of Nottingham Forest are among the most extraordinary I can recall.
Manchester City have dropped far behind Manchester United in terms of overall wage bill, the club’s annual report shows. City, who once had the largest Premier League salary costs. had a wage bill of £196m, putting them on a par with Arsenal and below United’s figure of £232m for 2015/16 and Chelsea’s £215m for the previous season.
Wages amounted to 50 per cent of turnover, the figure recommended by accountants Deloitte. Three years ago City were penalised by Uefa for breaching financial fair play rules.
The takeover of Birmingham City by Trillion Trophy Asia has at last been completed after a 16 month process. It ends the seven year period of ownership of Carson Yeung who was jailed for money laundering in 2014. The deal values the club at £12.3m.
Notts County chairman and majority shareholder Ray Trew has made a new effort to sell the club. He has approached local businessman Alan Hardy who has made two bids for the club in the past. He thinks that the world’s old professional team has the potential to reach the Championship
Trew has had talks with potential buyers from China and the United States and also with a UK hedge fund, but these do not seem to have gone anywhere.
Trew originally put a price tag of £8m to £10m on the club.
Juventus made an operating profit of €4.1m on revenues of €397.9m in the financial year. This is a respectable outcome, and a small improvement on the preceding year, but concerns remain.
The club remains highly reliant on television money. Its commercial revenue amounted to €73.5m in a year compared with €278.1m at Bayern Munich.
Liverpool have introduced a wage cap of £40,000 for their 17-year old first year professionals. This compares well with median gross annual earnings for full-time employees of £27,195. The amount paid can increase with bonuses. It is understood that Southampton and Tottenham Hotspur have similar policies.
In his latest piece of analysis the author of the Swiss Ramble blog turns his attention to Borussia Dortmund. Their experience demonstrates the challenge of keeping in touch on and off the pitch with Europe’s top clubs.
AFC Telford United are seeking a cash injection of £50,000 to deal with a cash flow problem. Gate receipts have fallen and some costs have risen. They also want to change the structure of the club away from control by a supporters’ trust to permit external investment.
They have been something of a yo-yo club and there is always a trade off between financial prudence and spending on players that might bring promotion and higher revenues.
Bolton Wanderers fans have been assured that the club’s finances are ‘on the right track’. The club’s accounts, which were due in March, have not been submitted to Companies House, but this should happen soon. It is one of the factors delaying the lifting of a transfer embargo on the club.
We are now into a second phase of global investment in English football, according to Rory Smith, writing in the latest issue of Four Four Two.
He argues that the Manchester City takeover in 2008 was a watershed. The amount it cost Sheikh Mansour to turn City into a top class Premier League outfit was much more than the money spent by Roman Abramovich on Chelsea.