Afternoon All, I hope you’re all enjoying the sunny day today (if you’re in London or anywhere sunny!)… unlike most Summers, this Summer seems to be quite busy already and the last two weeks post season has flown past. Real Madrid have kept us all very busy with their transfer activity which has seen Kaka and Ronaldo agree moves to the Bernabeu and it seems like Raul Albiol and David Villa will be next as both Valencia and Real Madrid have confirmed a £45m deal for both has been agreed.
Many people have wondered how on earth Real Madrid have been able to afford this and Perez answers the questions when he revealed:
“Real Madrid take about €400million a year, the fruit of three sources of income – a third from ticket sales, a third from television rights and a third from merchandising.”
And the advantage that Real Madrid have is that there is no real urgency to pay back any debts – being private investors and government related organisations, there is no focus at the financial to worry about the debt of the club – in fact, Real Madrid don’t actually see this as a debt, more like an investment. In fact, over the years Real Madrid have received over £500m in terms of investment from various sources, so although they believe they are not in debt, they actually live on very thin water!
In terms of club revenue, Arsenal are the sixth richest club in the world, with an annual turnover of over £200m. Chelsea and Man United had more turnover last season, but you’d expect those levels considering the events of the season and the trophies won / finals reached. Man United have a £600m debt and Cheslea a £500m debt. At the grove we have about £250m left on our stadium loan and with the Highbury flats windfall and other revenues, sources believe by 2020 we will be debt free. Imagine that, in 10 years from now, we will have no debt, and be able to spend all the revenue on players. With the pound surely strengthened by then and the management structure and academy top notch… surely we’ll be the richest club in the World? (If you take revenue and minus debt!)…
Position (06/07) Club Revenue
1 (1) Real Madrid £289.6M
2 (2) Manchester United £257.1M
3 (3) FC Barcelona £244.4M
4 (7) Bayern Munich £233.8M
5 (4) Chelsea £212.9M
6 (5) Arsenal £209.3M
Very exciting stuff, and the more I do the maths, the more I believe in Arsene’s vision of now and the future. Don’t forget we have a crop of kids coming through and a very decent squad which means we’ll never have to do what Real Madrid are doing now and spending upwards of £200m in one transfer window to reshape the squad…
Arsene said this in January regarding the way our club runs and it’s an accurate description of the difference between the other clubs in the top four and us…
“We live in a naturally healthy situation – we do not depend on one person, we do not depend on the banks because we make our profit. We respect our balanced budget, so I believe that we will not be in trouble. Fifteen clubs are for sale… and nobody is buying. I don’t know what will happen… I just know three months ago specialists said a barrel of oil would go to $200 but now it is under $40.”
And also, their is a difference between us and the rest of the teams – we don’t have a sugar daddy, a benefactor who will fund mis management. Eventually, these loans / investments will have to be paid back. Things are already starting to go a little crazy at Liverpool with news that they may have to sell a few players before they can invest in the squad – with Mascherano linked to Barce and Torres linked to Man United.
“Chelsea haven’t built a stadium and they lose £100m per year. How do you imagine you can deal with that at Arsenal Football Club without going bankrupt? We have to be responsible. It is not that we don’t want to spend. I believe that we have gone for a policy and we need to have a logic and a line of conduct inside the club that has to be respected. We have gone for a policy that is to develop our young players and we have to show some character and strength and not listen to everybody who comes out every day with a new name.”
Where you’ll see Man United spend £30m on Berbatov, you’ll see us spend £3.5m on a player like Van Persie – and answer me one thing – who would you rather have in your squad? The Bulgarian or the Dutchman? Of course, some of their buys will be good, especially with the amount they spend, but I do expect Arsene to buy a few players and I do expect them to be in the £8m – £12m bracket, Vermaelen being one of them. We’ll see what happens over the next couple of months – but one thing’s for sure – we won’t see any £30m players come in, but we will see a squad capable of challenging next season…
One day guys, we’ll be the richest club in the World… one day soon…