What are your plans for June 30th?
It’s pretty much mid-summer, so maybe an impromptu BBQ in the park? With the knowledge that Thursday is the new Friday, retire to a beer garden? Buy the kids a cup of ice cream so everyone can cope with the unbearable heat?
They’re all options if you’re not into football. If you’re into football, chances are you’re running around screaming trying to get things done because this year June 30 seems to be the date around which next season revolves.
It’s a date that will significantly affect the short and medium-term futures of Barcelona, Manchester United, Atletico Madrid and half the other teams in Spain, Paris Saint-Germain and Neymar, Everton and a large number of clubs in the EFL could. So not much.
Let’s start with Barcelona. Their financial chaos is well documented, with Joan Laporta and the rest of the board trying to find increasingly creative ways to allow the club to operate under the crushing weight of its €1.3bn debt.
June 30 matters so much because that day marks the end of their fiscal year, the outcome of which will determine the salary cap La Liga will impose on them in their own calculations on July 31.
So Barcelona need money, and fast. That could happen through a variety of creative avenues, including the “financial leverage” that Laporta asked the club’s members for earlier this month. This would involve either selling around half of Barca Licensing and Merchandising, the company that controls large parts of their commercial activities, or selling a maximum of 25 percent of their future TV earnings.
To a layman, even knowing you need a quick buck, selling long-term earnings for a short-term cash injection sounds risky at best. “There’s elements of payday loans in all of this,” says Kieran Maguire, football finance expert and host of the Price Of Football podcast. “It’s a short-term solution with a long financial end.”
No such sale has been confirmed at the time of writing, but Laporta and the Barcelona board will be working hard to bring something in before the clock strikes midnight on the 30th.
Again, a much more sensible option for a layperson would be to simply reduce their spending by selling a few players and then not hiring other, possibly even more expensive, players. That’s why their hunt for Robert Lewandowski feels so strange, but this is Barcelona: they must feel like they’re still competitive, still glamorous, still able to attract top stars when in reality they’re barely two pesetas have to rub together.
And, in fairness, they do, as anyone following the torturous Frenkie de Jong saga will attest. The current buzz seems to be that Barca and Manchester United have largely agreed on a fee of £56m plus fringe benefits, but Barcelona’s need to raise funds by June 30 hangs over the whole affair.
Barcelona aren’t the only Spanish club approaching financial D-Day. Atletico Madrid CEO Miguel Angel Gil said this week that his club needs to raise €40m by June 30 or they will also record a loss later in the year. In that case, La Liga rules would mean they could only spend one euro for every three euros they collect.
Valencia also need to sell, with Carlos Soler and Goncalo Guedes the most likely exits. Sevilla have already sold Diego Carlos to Aston Villa which at least gave them breathing room not to have to hand over Jules Kounde for less than his worth. Espanyol could come up with €25m and Celta, Alaves, Real Sociedad and Real Betis are among the other clubs set to complete a transfer sale to meet La Liga’s deadline.
A similar, albeit less drastic, situation exists in England. As in Spain, June marks the end of the financial year for several clubs and the Premier League side that seem to have the most at stake is Everton.
“The finances of Premier League clubs are looking pretty healthy from a financial fair play perspective,” said Maguire. “But Everton is the club that comes closest to the FFP limits.”
The short and simple version is that it would be extremely helpful if they could sell someone by June 30th. The overall situation is much more nuanced, as Patrick Boyland and Greg O’Keeffe explain here, but since June 30 is also the end of the four-year (extended from the usual three to accommodate COVID-19 seasons) FFP cycle this their last chance to add incoming funds to their 2021-22 P&L calculations.
The easiest way to do this is to bring in a big fee for a big player, mirroring what Crystal Palace did a few years ago. “Aaron Wan-Bissaka was sold to Manchester United on June 30, 2019,” says Maguire. “Palace had lost around £40m this year but by selling Wan-Bissaka on 30 June rather than 1 July, the £40m loss turned into a £5m gain.”
So who will go? Dominic Calvert-Lewin would be an attractive candidate, particularly as he was bought for £1.5million in 2016 so his sale would represent ‘pure profit’, while for a player costing more the situation is a bit more complex.
To use a hypothetical example, let’s say Everton bought a player for £25m in 2018 on a five-year contract. For financial reporting purposes. That fee would be amortized over his deal, meaning his ‘book value’ falls by £5million every year. The book value of this player, who has been there for four years, would now be around £5million. Therefore, if they sold him for £15m, they could ‘book’ a £10m profit. But if they were to sell Calvert-Lewin for £50m almost everything would go into their calculations.
However, an injury-plagued season means there is only a limited market for him. Elsewhere, Juventus have signed Moise Kean on a two-year loan with a commitment to buy in 2023. So why would they prefer that just to match Everton’s accounts? Tottenham are keen on Anthony Gordon but it would be – in many ways – a significant gamble to sell a homegrown youngster who, even with a new contract on the horizon, would not be among the highest earners.
So all roads point to Richarlison. Tottenham and Chelsea are interested but the problem is that now everyone knows Everton have to sell so they don’t mind offering the top price. The most likely outcome is the Brazilian’s departure for anyone who can pay in time, but that’s far from certain.
If Everton don’t make that sale the walls won’t exactly come down, but they won’t be able to make any significant signings this summer and, like last year, will be reliant on free transfers, loans, loans with an option to buy, loans with an option to buy and every other creative option that comes to mind.
And then there’s Neymar. The man who remains the most expensive player in football history has felt less and less relevant over the past year: he is at best his club’s third most valuable player, behind Lionel Messi and world’s first striker/sportsman director Kylian Mbappe.
Still, the deal he signed in spring 2021 – billed at the time as a three-year extension that committed him to PSG until 2025 – was effectively a five-year extension. An additional year for the deal was triggered in early July 2021, and another year will come into effect in early July 2022, meaning his deal now runs through 2027.
Unless he leaves before that overtime triggers. Someone else would have to pay his wages for this and ideally pay PSG some kind of transfer fee. The suggestion is they would be keen for him to find another club, but unsurprisingly there isn’t a colossal line forming to sign a 30-year-old, who is making colossal salaries, having played 18 games last season has missed various ailments and wasn’t exactly a world champion when he was fit to play.
Sources have pointed this out the athlete that Neymar would love to return to Barcelona but even if they manage to emerge from their financial abyss they have other priorities. There has been speculation in the French media that Newcastle United, Chelsea or Manchester United are potential targets but Neymar has made it pretty clear that he doesn’t want to play in England.
“I expected all the players to do better than they did last season,” PSG president Nasser Al-Khelaifi said last week, theoretically speaking about the entire squad, but you don’t have to squint too much to tell between to read the lines. “Much more. The message is clear: work 200 percent every day. If you want to stay in your comfort zone, stay out of it.”
If you think he’s non-transferrable now, the extra time on his contract would essentially make him absolutely, fully non-transferrable, a contract that will last until he’s 35 years old. So these few days is the last hope, at least for a few years, to move on from the whole experiment. If not, he stays at PSG and everyone has to make the best of it.
All of these extraordinary events come on top of the usual frenzy of expiring contracts, which is a financial consideration for these clubs as many players are entitled to bonuses at the end of their business. For example, it is assumed that a Football League player would be owed £27,000 if he leaves a club which, let’s just say, could do without paying £27,000 to a player walking out the door.
Finally, after all that, some real football. Thursday will be England’s last friendly ahead of Euro 2022 when they meet Switzerland in Zurich, their last vote before the tournament opener against Austria next Wednesday.
It’s Sarina Wiegman’s last chance to think about answers to the remaining questions about her team. Who will play up front? Is there room for Fran Kirby? What about Ella Toone? Who starts as left-back? Does the 5-1 win over the Netherlands put undue pressure on an already stressed side?
If nothing else, watching could be a good way for anyone trying to make sense of all the financial gimmicks to clear their brains a bit. That or that ice cream thing.
(Additional Reporting: Patrick Boyland, Adam Crafton and Dermot Corrigan)
(Top Photos: Getty Images; Design: Sam Richardson)