FC Barcelona have raised over £200 million via a TV rights deal to combat their debt woes.
The Catalan giants have been in a financial mess for a few years now. Unfortunately, the COVID-19 pandemic increased their money problems exponentially too. According to ESPN, Barca’s debt stood at a staggering €1.35 billion.
Additionally, the club had an exorbitant wage bill of €560 million. Most worryingly, €670 million of the debt is owed to the banks.
Despite trimming the wage bill and selling players, Barcelona still find themselves in difficulty. For instance, they should have completed the free-agent signings of Andreas Christensen and Franck Kessie. However, their current budget means that they are unable to register the pair as Barca players.
Because of their financial woes, Barcelona have turned to selling assets in order to reduce their debt.
Barcelona sell TV rights assets
Barcelona sold 10% of their La Liga TV rights for the next 25 years to Sixth Street. From this, Barca will make €267 million (£231 million) for next season, with €207.5 million coming as an initial investment.
“We are activating economic levers and executing on our patient, sustainable, and efficient strategy to strengthen the club’s financial footing,” announced Laporta.
“Sixth Street is a proven supporter of football. It is also an experienced investor across global sports and media, and a partner that will contribute significant knowledge and resources while allowing us to independently manage our operations.”
This latest sale comes weeks after news of a large sale of licensing and merchandise.
What else can Barca sell to clear debt?
Per Reuters, the Catalan giants sold 49.9% of the retail side of the club, known as Barcelona Licensing and Merchandising, in June. This investment from a group including Fanatics and Investindustrial is set to earn Barca a further €200-300 million, helping to ease the money difficulties.
Add this to Forbes’ estimate that Barcelona’s revenue is €582 million, and it seems that the club is doing okay. But this is not the case. Debt still looms over Barca. Meanwhile, there is a dire need to reduce expenditure.
One method of doing so is the sale of players. Midfielder Frenkie de Jong has long been considered for sale; he is supposedly close to joining Man United. Additionally, players such as Serginho Dest, Clement Lenglet, and Memphis Depay are all available for the right price, per Marca.
Similarly, several players will leave upon the expiry of their contracts. Yet this still may not clear all that is owed. Despite selling players, the new TV rights sale, and the merchandising deal, Barcelona may still be €100m-to-€300m in the red.
For Blaugrana fans, this may be a long and painful process of cost-cutting and deal-making. At least Barca are heading in the right direction, though.
Featured image credit: Getty