Barcelona are in a huge financial crisis. It is no secret that the club has accumulated a lot of debt during Josep Maria Bartomeu’s time as president and a figure of 1.2 billion euros is what the club owes others in debt. On top of that, the club also has a 500 million euros short-term debt which needs to be paid back by 30th June. Thus, with all these financial problems, it is hard to understand how the Catalans will afford super striker Erling Haaland.
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Joan Laporta had been speaking about bringing in the Borussia Dortmund striker since his early campaigning days and now that he has been elected, he plans to deliver on his promises. On Thursday, the president had a meeting with Haaland, his agent, Mino Raiola, and his father. This was quite shocking for the footballing world as no one expects Barca to sign such a world-class player in such a situation and many have even started saying that it is the “Laporta effect”.
So how exactly will the club be affording Haaland’s 180 million euro price tag, the answer to that question is a bit complicated. Well, the way that the club works currently is that it is not owned by a company but rather by the members. It is forbidden for Barcelona to sell its shares to other companies or investment groups. Thus there is no one at the top who can just pump money into the team and the club will need to take an investment loan.
Barcelona could take a massive loan for Erling Haaland
During the time of Bartomeu, the former president brokered a deal with Goldman Sachs, an American multinational investment bank. The bank had agreed upon lending 800 million euros to Barca for Project Espai. The loan of 800 million euros would then have to be repaid by the club over the time span of 30 years. This deal is waiting to be approved by Laporta and as soon as he does this, the club will have the money to pay player wages as well as to repay their current debts.
According to economist and Laporta confidante, Marc Ciria, Barcelona plans on paying player wages with the loan from Goldman and the bank has no problem with that as they are charging 3-4% interest. It might be a short-term relief for the club but could be a long-term nightmare as, if they do not have the money to return to Goldman, there will be a lot of problems, including a change of club ownership.
The club would have to give away their assets to Goldman and the stringent clause could mean that the American bank could own up to 70% of the club if they fail to repay the loan. Something similar happened with AC Milan as well and now the club is owned by Elliott Management Corporation.
While Bartomeu had previously said that the loan would not risk changing the club’s ownership or the structure, one cannot take his words to be the truthful statement. As things currently stand, yes the Catalans could take the loan and try to bring in Haaland with that money, however, in the long run, it could come back to haunt them and the club could change its identity forever.
Should Barca risk ownership to recover from its financial crisis?