Members of the LaLiga club, FC Barcelona have agreed to sell a fraction of the team’s television rights as well as potential earnings from merchandise and licencing in order to inject €600 million ($631 million) into the debt-ridden Spanish club immediately.
After two seasons of being unable to make significant signings due to serious debt that exceeded €1.3 billion (nearly $1.37 billion), the club president Joan Laporta stated the two measures were essential to creating profit and having good credit.
Representatives, or selected club members, voted to assist the two financial metrics proposed by Laporta.
The 49 per cent sale of the company, which Barcelona functions to attain licencing and merchandising rights is the first measure. The club expects to generate revenue between €200 and €300 million ($210-315 million).
Laporta stated that he will only accept an offer that includes a repurchase option, allowing the club to regain full control of those assets at a later date.
The 25 per cent sale of income from TV rights from Spanish league matches for a period of 25 years is the second measure. Following the process, the club hopes to earn approximately €450 million ($473 million).
Laporta evaluated by comparing his club’s plight to that of a Formula 1 race car in need of total revamps. He claims that these two financial transactions will allow “The F1 car to leave the pits and return to the front row of the grid to compete and win again.” When delegates asked Laporta and other board members, they refused to divulge any information about offers or potential buyers.
Barcelona’s financial moves come months after it continued to refuse, along with Real Madrid, to take part in an investment strategy protected by the Spanish league to help clubs recover from the pandemic.
The massive salaries and transfer fees paid by Laporta’s predecessor, Josep Bartomeu, are being faulted for Barcelona’s financial ruin. The revenue damages suffered due to the pandemic exacerbated the situation, to the point where the club was unable to retain the all-time leading scorer Lionel Messi last summer, despite his willingness to reduce his wages.
Due to the team’s ruined finances, the tournament has reduced Barcelona’s salary cap to seven times that of Real Madrid. The club has decided to not make any significant signings this offseason and is attempting to persuade its players to accept another pay cut.