Financial Impact Of Messi Transfer to PSG

Financial Impact Of Messi Transfer to PSG

 

Photo Credit: PSG Twitter

Lionel Messi’s departure from Barcelona left the entire world in shock. The club tried their hardest to re-sign the player after his contract ran out, but due to La Liga rules and their terrible financial condition, they failed to register the Argentinian and he had to leave after 21 glorious years at the club. 

While there obviously will be an impact on the club’s first team tactics and plans in various competitions, there will also be massive financial implications on Barcelona and La Liga. So let’s look at how the Messi transfer affects the business side of things. 

Marc Ciria, the CEO of Diagonal Investments and a Barcelona socio (one of the 140,000 owning members of the club), along with financial experts like Josep Fabra (a financier) and Ivan Cabeza (an economist), has calculated the amount of money that Messi brought to Barca since he signed a new contract with them in 2017. Since the renewal, he has cost the club approximately 383 million euros (without taking the 2020 season into account because of the pandemic), but has generated a revenue of approximately 619 million euros in the same period of time. 

According to Ciria, Messi accounted for 30% of Barcelona’s revenue, which included ticket sales, club merchandise, VIP passes and sponsorships. As per reports, sponsors had two options, one with Messi and one without him, and the former option would increase the cost by upto 50%. This has been referred to as the “Messi clause”, something from which Barcelona have benefitted for over a decade. 

Messi is considered an investment, unlike other players, who are considered an expense. However, he could not have continued at the current wage for a long time, because that would have left Barcelona in disarray. Messi’s wages were not sustainable for the club, but they still needed him for the revenue. 

It’s not just Barcelona, La Liga is also expected to have a massive drop in viewership, which feels like a repeat of the Cristiano Ronaldo transfer to Juventus. After losing two of their biggest stars in the past 5 years, La Liga is set to face a financial setback, and how they deal with it could decide the future of the Spanish league. 

Lionel Messi’s departure is just one of Barcelona’s many financial problems. The club, previously run by Josep Bartomeu, is in an approximate debt of 1.2 billion euros, which is a staggering total. Joan Laporta, current Barcelona president, has revealed the extent of unnecessary expenditure by the previous regime, with the most shocking expense being the 7 million euros being paid for scouts in South America, from where Barcelona have not had any major signings. 

Previous mistakes have proven to be extremely costly now, especially in terms of signings. Reportedly, the club were not allowed to register new signings like Sergio Aguero, Memphis Depay and Eric Garcia because of their extremely high wage bill, and because of that, significant players within the squad either took a pay cut, like Sergi Roberto, gerard Pique, Jordi Alba and Sergio Busquets, or left the club, like Antoinne Griezmann, Miralem Pjanic and Trincao. Their wage situation was so bad that they had to sell Emerson Royal, a right back they bought this summer from Betis, to Tottenham Hotspur. This move left the defender disappointed, since he was left extremely deserted by his boyhood club. 

There is no doubt that Barcelona will miss Lionel Messi’s presence. Not just on the pitch, but off it too. The Argentinian has left a massive hole in both the first team and the revenue streams for Barcelona, for whom his departure could not have arrived at a worse time. 

With an approximate 30% of revenue virtually transferred to Paris Saint Germain and a massive transfer crisis, combined with the possible viewership drop in La Liga, the Spanish giants could have a terrible year ahead, and one would not be surprised to see why they want a Super League so badly, despite almost every club pulling out of it. When one looks at Barcelona’s finances closely, their desperation for more money is completely understandable, even if it is wrong and unfaithful to the fans.

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