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The painful defeat against Paris Saint-Germain at their “home” stadium and not qualifying for next year’s Club World Cup are certainly painful experiences for Barcelona and its fans. However, there is a greater disaster waiting around the corner.
How terrifying – revealed Dermot Corrigan, journalist at The Athletic. He analyzed Barcelona's financial situation and drew conclusions from it. They are not optimistic about the team from the Catalan capital.
The crane collapses. Will Barcelona return the money?
The club's situation is even worse than it was in 2022, when the administration announced that Barcelona could not afford any transfers because the league imposed a financial gag on it. Debts accumulated under the previous management and exorbitant player salaries sank the club. Then President Joan Laporta came up with so-called financial leverage. In short, the idea was that he sold a certain percentage of his future income for real cash. The aim of this deal was to allow the club to make transfers to strengthen the team. And it worked. With the money from leverage the following was executed and recorded: Robert Lewandowski's transfer. But two years after the accounting trick, there's no money left in the coffers, debts still exceed a billion euros, the team needs to rebuild, and one of its levers is collapsing.
This is Barca Media (formerly Barca Studios), a company that operates a paid media platform for Barcelona fans. The club was scheduled to receive 200 million euros from the sale of 49.5 percent of its shares. At the moment, he received PLN 120 million and it is not known whether he will have to repay it. A condition of the agreement was that the company be filed with the New York Stock Exchange. Its value was optimistically estimated at $1 billion, but the case is collapsing – as reported by The Athletic. Some investors who were supposed to buy Barca Media shares withdrew from the project. In addition, the company has been hit by the U.S. Securities and Exchange Commission, which has tightened regulations to protect investors from inflated company valuations. As a result, the debut, which was supposed to take place at the end of 2023, was postponed to March. Nothing happened in March again, and the club only had time until the end of April this year. After that, investors who have already given Barcelona €120 million in exchange for shares in Barca Media will be entitled to demand their money back with interest. Of course, Barcelona doesn't have that much money because it's all been spent. What's more: the €40 million the club was supposed to receive from Libero's money in exchange for shares in Barca Media, but which the club did not receive, has already been included in this season's budget as revenue.
The Spanish League will not allow Barcelona to make any transfers
Other problems loom for Barcelona from the Spanish League authorities. The Spanish League has strict financial discipline rules, which prevent debt-ridden clubs from making transfers and spending excessively on salaries. This season, Barcelona's salary cap was set at €270 million, but the club has far exceeded that and is paying staff €492 million. If the Spanish champions want to make any transfers in the summer, they will have to cut their wage budget significantly. However, Frenkie de Jong, who has the highest contract at the club, has no intention of leaving Catalonia at the moment. Likewise, Robert Lewandowski, whose salary in the new season is expected to rise to 32 million euros.
Worse still, Brazilian Vitor Roque, acquired in the winter, can only be registered with the club on a 'medical transfer' basis for the injured Javi until the end of June. In theory, if Barcelona cannot find the funds to supplement the libero's non-existent €40 million, the striker intended as Lewandowski's successor will not be able to score again. In such a situation, he could leave the club on a free transfer. Barcelona will lose the €40 million they spent on the 18-year-old.
It should be noted here that Barcelona has also included €60 million in its budget, which will be received in June as a result of the purchase of shares in Barca Media from Socios.com and Orpheus Media. However, if – as I wrote above – the stock exchange debut fails, there will be no money.
UEFA is monitoring Barcelona closely. There will be punishment, but what will it be?
It may turn out that Barcelona will lose $100 million in unrealized revenue from this year's budget. The Catalan club no longer dreams of using any new tools. Immediately after Barcelona used the previously mentioned leverages, Spanish League clubs issued a law limiting this type of financial leverage.
Barcelona's problems are not limited to Spain. UEFA is closely monitoring the financial engineering of the Catalan club. In July last year, UEFA imposed a fine on the Spanish champions of 500,000 Polish zlotys. Euro to include leveraged funds in financial statements. Thanks to them, Barcelona showed a profit, while according to UEFA, it should show a huge loss. But the club's appeal was of no avail. In November, the decision was upheld.
It will now be interesting to see if Barcelona will announce leveraged revenues again in their report for the 2023/24 season. If that happens, he will be charged with recidivism, with a much higher penalty of PLN 500,000. euro. However, if you showed an unleveraged budget, it would show a huge loss – higher than the €60 million over three years allowed by UEFA. And then she will be punished as well. The German newspaper “Welt am Sonntag” previously wrote that Barcelona would remain due to so-called violations and Financial Fair Play was excluded from the Champions League in the 2024/25 season, but UEFA denied this information. But the reason is that activists from the European headquarters have not yet started analyzing the financial data for the 2023/24 season. Everything will become clear in July.
Will Laporta become a gravedigger?
To sum up this whole financial argument: Dark clouds have gathered over Barcelona. If things go wrong, there will be a €100 million shortfall in unrealized revenue in the 2023/24 season budget. The club will have to return 120 million euros to investors due to the failure of Barcelona's media project. Due to the wage budget being exceeded, Barcelona will not be able to make any transfers in the summer. Players who were registered conditionally in January will be able to leave on a free transfer.
The final decision will be that of UEFA. If the Federation expels Barcelona from the Champions League, Laporta will go from the club's savior to its gravedigger.
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