Transfer Rumours 21/22
- Thread starter King Binny
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We're being linked to every player in the PPL now ! This lacks credibility methinks.
I am and I didn't say it isnt
Isn't the Buy-out clause is now £100m?
Yep, posted it. It says Porto expects us to make a better offer. Somehow Porto have become a feeder club, even gave us first refusal on Vieira.
I don't think there's a shred of truth in Otavio, however, if it is true, then he will be used on the Right to whip balls in, so may be our formations will adapt
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Have taken a look at this now and done some high level analysis based on ours and United's books over the last 5 years. Given that football finances can be so volatile over short-term time periods, I think it's necessary to look over a longer period. The years in question are seasons 2016-17 to 2020-21 (so 12 months out of date due to timing of publishing accounts).
We've been more profitable over that period (£261m at the bottom line, after dividends) but coming back to my old mantra it's really cash we need to look at.
In the last five years, United have generated over £264m more cash from their basic operations than we have (this includes wage spending, but excludes transfer fees).
Broadly, this is coming from higher commercial revenue (£424m higher), higher match day (£116m higher) but lower media (£68m lower) - the latter due to their poor on-field performance relative to ours. At the top line (turnover) they are £472m better off than we are.
They've spent £76m more in wages than we have, but also £87m more in interest payments, plus £123m in dividends to the Glazers. By contrast, we've spent £78m more on capital projects.
On the transfer side of things, and I'm using cash here, not headline fees, so it takes account of instalments etc, they've then invested £248m more into buying players, and have raised £128m less on player sales - so on a net basis, they've put £376m more into the playing squad than we have.
The simple explanation is that they are still generating more cash from their commercial and match day operations. After some of that is consumed by interest and dividends to the Glazers, they still have more to plough into their playing squad, both in transfer fees and wages.
I also commented about debt last night. Over the period in question, the net movement in our financing (I'm just talking borrowings here, as per the cash flow statement) is a £34m reduction. United have reduced their borrowings by £52m, but they've eaten into their cash reserves to the tune of £229m. In short, relative to us, they've spent £185m of their cash reserves / debt capacity, plus £264m extra that they generated themselves, outspending us in total by £449m. And they're still utter gash.
But they could afford to do this because they make more money from their operations and because they were sitting on a wedge of cash to begin with.
On a go-forward basis, they will only be able to continue to outspend us to the extent their operational cash exceeds ours. They still brought in £93m more than us in 2020-21, but due to covid etc. it's risky to draw too many conclusions from that. Beyond that, they will need to borrow as their cash reserves are depleted now.
@Woland has talked in the past about the foolishness of us using our own cash for capital projects when we could borrow cheaply and save our own reserves for squad investment. I agree with this, but I expect it's due to the shareholder politics I talked about last night that we don't do this. United, by contrast, will likely borrow to fund any stadium works they undertake, and this will give them an advantage relative to our current position, as they'll still have money to invest on the playing side while they do those works.
@Beamrider I don't know how you found this little corner of the internet mate, but you're a treasure(r).
Second that.
As an aside from the above, I did some high-level analysis of key Premiership clubs plus Farcelona (for the LOLs) on their cash flow over the last five years. This was focused on how much those clubs had overspent on transfers / capital projects relative to what they'd generated. Basically, this is the extent to which they were spending beyond their own means.
A simple summary of what they'd spent, including transfer fees - basically money out that then had to be covered by borrowings / shareholder funding / eating into cash reserves:
LFC £10m
Man Utd £68m (excluding dividend payments)
Arsenal £100m
Leicester £201m
Chelsea £277m
Everton £321m
Farcelona £422m
City £594m
Spurs £726m
The clubs that then find themselves fucked are the ones who struggle to bridge those gaps. We're OK because there isn't a gap. United and Arsenal have used up their own cash, Leicester, Everton, Chelsea and City have relied on shareholders (either loans or new equity) and Spurs have borrowed secure, long-term funds because most of their overspend is on the new stadium which they can easily borrow against. Everton and Chelsea are obviously in interesting positions because of their ownership and are backs to the wall on FFP.
Farcelona are fucked because they don't have a sugar-daddy owner, had too little cash to begin with and don't have a queue of lenders bending over backwards to give them cash.
With the exception of Spurs, all the clubs at the bottom of that table have spent huge amounts on their playing squads, and other than City they've generally spent it badly. And that's why some of them are in a financial mess right now.
A simple summary of what they'd spent, including transfer fees - basically money out that then had to be covered by borrowings / shareholder funding / eating into cash reserves:
LFC £10m
Man Utd £68m (excluding dividend payments)
Arsenal £100m
Leicester £201m
Chelsea £277m
Everton £321m
Farcelona £422m
City £594m
Spurs £726m
The clubs that then find themselves fucked are the ones who struggle to bridge those gaps. We're OK because there isn't a gap. United and Arsenal have used up their own cash, Leicester, Everton, Chelsea and City have relied on shareholders (either loans or new equity) and Spurs have borrowed secure, long-term funds because most of their overspend is on the new stadium which they can easily borrow against. Everton and Chelsea are obviously in interesting positions because of their ownership and are backs to the wall on FFP.
Farcelona are fucked because they don't have a sugar-daddy owner, had too little cash to begin with and don't have a queue of lenders bending over backwards to give them cash.
With the exception of Spurs, all the clubs at the bottom of that table have spent huge amounts on their playing squads, and other than City they've generally spent it badly. And that's why some of them are in a financial mess right now.
And just an extra comment on Farca, if you'll permit be to be a bit more nerdy than usual.
You can see the problem building by looking at the borrowings going up and up each year, but it's hidden by the fact much of it doesn't filter into their profit and loss account. Then in 2021 the dam bursts and they incur a whopping loss of €481m, when in the previous 4 years their aggregate loss was €66m.
I think a lot of this relates to player valuations (amortisation) and, I suspect, is largely due to the Messi situation.
Basically, accounting rules allow you to value your playing squad as an aggregate whole (although players out on loan aren't included in the squad, so they had taken a few hits previously, probably for Coutinho).
Within the squad, if individual players are over-valued, but others under-valued, then provided the total valuation exceeds the total in the accounts you don't have to take a loss. In the summer of 2020, it was obvious that they'd overspent on a lot of bang-average players whose individual market values were lower than what was in the accounts. However, they still had one Lionel Messi on the books. Accounting value negligible, market value, even then at his age and with 12 months on his contract, probably north of €100m (they would probably have had offers to prove it), so no need to take any hits.
Fast forward 12 months and he's out of contract, market value is €nil and the squad total is over-valued, but now they have to take the hit. So they ended up writing down the playing squad by €165m and the losses that had been building up, unseen and unrecognised due to an accounting quirk, finally came out in the open.
Obviously covid and them being shit didn't help either.
But much of it can all be traced back to a few key events, most notably an over-priced Dembele / Coutinho and a quickly-taken corner.
You can see the problem building by looking at the borrowings going up and up each year, but it's hidden by the fact much of it doesn't filter into their profit and loss account. Then in 2021 the dam bursts and they incur a whopping loss of €481m, when in the previous 4 years their aggregate loss was €66m.
I think a lot of this relates to player valuations (amortisation) and, I suspect, is largely due to the Messi situation.
Basically, accounting rules allow you to value your playing squad as an aggregate whole (although players out on loan aren't included in the squad, so they had taken a few hits previously, probably for Coutinho).
Within the squad, if individual players are over-valued, but others under-valued, then provided the total valuation exceeds the total in the accounts you don't have to take a loss. In the summer of 2020, it was obvious that they'd overspent on a lot of bang-average players whose individual market values were lower than what was in the accounts. However, they still had one Lionel Messi on the books. Accounting value negligible, market value, even then at his age and with 12 months on his contract, probably north of €100m (they would probably have had offers to prove it), so no need to take any hits.
Fast forward 12 months and he's out of contract, market value is €nil and the squad total is over-valued, but now they have to take the hit. So they ended up writing down the playing squad by €165m and the losses that had been building up, unseen and unrecognised due to an accounting quirk, finally came out in the open.
Obviously covid and them being shit didn't help either.
But much of it can all be traced back to a few key events, most notably an over-priced Dembele / Coutinho and a quickly-taken corner.
In what universe do swap deals happen? Not in mine, NOT IN MINE! There's more chance of us getting a handful of magic beans for one of our players, planting them, and convincing the giant to play centre forward.
That'd still be classed as a swap... no?
He meant swap you. For a Tesco meal deal and a go on a bong.
Swap deals don't fucking happen. Because I need to agree to that deal and I'm not swapping unless it's M&S and at least 3 goes on a bong. And nobody's offering that.
I thought clubs just amortised the fees over the initial contracts? They don't revalue them do they?
So wouldn't even really shit signings be on the books at not more than market value within a couple of years anyway?
You’re right on the accounting, but I think you underestimate how quickly a player’s value can drop off. Usually the players assessed for impairment will be those outside the squad (on loan) so often you’re looking at the value at the end of the loan (which may be fixed by a sale option / obligation in the loan deal itself and reflect the passage of time until it kicks in).
And finally, the accounts values are inflated versus sale price by the addition of agent fees and levies etc (so a £50m signing May well be initially recognised at £60m when fees etc are added). When you’re looking at the realisable value, you will err on the side of caution for accounts purposes (prudence) and only consider the net proceeds you’ll get (which may also be after deducting some element of inducement payment to get the player off the books as the prospective buyer won’t pay their full wages). You might also assume you’l have to pay his agent to find a club willing to take him.
Fair enough... I'd still have thought the amortisation on all the players whose values haven't fallen or at least not fallen much would offset the high book values of a few shit signings, even the likes of Coutinho.
I'd have thought that as a rule player values are understated in accounts.
I'm wondering to what extent de Jong's heart would be in that move. It's beginning to look to me as though he'd actually prefer to stay where he is but is being pushed towards the move, in which case it could turn out like Lukaku's return to the Chavs. What a shame that would be.
Did Barca try to sign Maguire ?
And did the mancs reject the offer ?
If yes to both, then ROFLMAO
And did the mancs reject the offer ?
If yes to both, then ROFLMAO
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