Q&A ON BARCELONA’S FINANCIAL CRISIS: Is Joan Laporta right to blame Josep Bartomeu for their £1.15BILLION debt? Can the club stay member owned? … and how they could STILL buy a new striker!
- Barcelona have announced their debt has built to £1.15billion since January
- President Joan Laporta has a plan, as he hit-out at predecessor Josep Bartomeu
- Laporta has insisted the club will not have cease being member-owned
- It’s a long road ahead for Barca, and Sportsmail checks-in on the situation
So do you want the bad news or the bad news?
Press conferences concerning the finances of Barcelona usually go in that direction but at least President Joan Laporta looked like a man with a plan as he tore into his predecessor Josep Bartomeu on Monday.
Sportsmail looks at the current state of play of the club’s catastrophic situation.
It’s a bleak time at the Nou Camp with Barcelona announcing rising debts of 1.35billion euros
Just when it seemed the club was on the mend with Pique’s pay-cut and that opening day win, news that the debt is even bigger!
Yes it was thought to be £996m but President Laporta said Monday it’s at £1.15billion. Previous president Bartomeu left the club bankrupt basically.
Laporta said the club’s net worth now was in negative -£383m euros. So if they sold all assets they wouldn’t be able to pay off the debt. In theory that’s bankrupt.
Were they not a Sporting association instead of a company they might have had to start putting a price on the Camp Nou.
Laporta confirmed losses of £409m from last season when the club brought in £557m but spent £961m. He always maintained that Bartomeu’s Barca was the three billion club – one billion revenue, one billion outgoings, one billion debt.
Post pandemic that is now only two-thirds right with income obliterated and spending and debt soaring.
Barcelona president Joan Laporta is the man charged with getting the club out of their mess
This is all terrible news for the club
Well it is, but it’s not really new. They knew things were bad. This was merely Laporta giving some more exact figures, pinning the blame on his incompetent predecessor and telling supporters there is a way out of this.
Some good news?
‘In a couple of years our economy will be healthy,’ he promised on Monday. The debt has been restructured and as shown by the ultimate reluctance to give Messi another huge contract the club has turned a corner and left its ruinous ways behind it.
When he was asked if the club would need to cease to be member owned, Laporta said: ‘The situation is dramatic but we have good news because we have a strategic plan in place that means the situation is temporary.
‘There is no risk of having to change our status, Barcelona will always belong to its members.’
Barcelona began their new era without Lionel Messi with a 4-2 victory over Real Sociedad
But don’t they still need to find 200m euros from somewhere?
Not anymore. They needed to do to keep Messi. His departure means the savings that need to be found at least in order to register any more new players will be more modest.
Ronald Koeman mentioned wanting to sign a striker on Saturday. So that’s not beyond the realms?
Laporta said Monday: ‘We have to apply the 1:4 rule so if we free up 100m we can spend 25m.’ By the same token if they get someone earning 10m off the wage bill they can bring in someone who is willing to earn 2.5m. That’s how they managed to register new players this weekend.
They had got Matheus Fernandez, Junior Firpo and Konrad de la Fuente off the wage bill and when Gerard Pique took his pay-cut they were able register Memphis and Eric Garcia.
In fact because Pique is seen as one of the club’s franchise players that triggers a sub-clause of La Liga’s 1:4 rule – a 1:2 ratio is applied instead meaning half the money saved from his wages can be spent.
Gerard Pique took a pay-cut which allowed the club to register their new signings this summer
So bizarrely we might not have seen the last of Barca spending?
Well it won’t be net spend! If the club gets someone off the wage bill, or if the other veterans take a similar pay-cut to Pique, then they could register more players.
And in the longer term the cut backs must continue?
When Laporta says he didn’t know how bad things were when he took over you have to believe him. Certainly that meeting with Erling Haaland’s agent looks ridiculous now.
There will be a couple of very low cost transfer windows and the club has to drastically change its plans for the redevelopment of the Camp Nou.
No New Camp Nou?
They still need a rebuild but it will have to be cheaper. The budget for the recently built Estadi Johan Cruyff where the B-team plays was £3.4m and cost £17m. It’s clear Espai Barca needs to be rethought.
A new finance plan should be approved later this year with work starting in the summer of 2022.
The club want to rebuild their famous Camp Nou stadium but the budget must be slashed
And that overspend on the Cruyff Stadium was the last regime who were destroyed by Laporta in his press conference on Monday?
He took 30 minutes to answer the first question because it prompted him to respond to a weekend open letter from his predecessor.
‘His letter of eight points is a letter of eight lies,’ said Laporta, ‘and it’s worse coming from a president who has left the club in ruins’.
He added: ‘They received 222m from Neymar and spent it at the speed of light and disproportionately and we are left with salaries and amortization payments out of control.’
And the criticism is justified?
Totally. Laporta said the club’s due diligence had unearthed endless acts of irresponsibility. One scout working in South America was being paid £7m euros and commissions in general were through the roof.
He says he needed to get an immediate bridging loan from Goldman Sachs to pay wages. The old board also stand accused of breaking up contracts into smaller amounts so they avoid internal auditing.
Josep Bartomeu oversaw a drastic decline during his Barca reign, leaving the club in a crisis
The stadium also needed immediate work carried out to the tune of £1.5m to make it safe for the start of the season. Laporta also said it was nonsense that as Bartomeu claimed the current board had passed up on the chance to sell chunks of the club off.
The package of Barca offshoots and departments including La Masia and Barca TV is known as Barca Corporate and Bartomeu claims Laporta is sitting on good offers for it.
He dismissed that idea saying: ‘Selling Barca Corporate was a way to try and cover holes in the accounts in the short-term. Barca Corporate is not in a position to be sold.’
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