Barcelona Pays Messi & Collects Phones: How the Club is Trying to Recover from the Crisis

Barcelona is still struggling to get out of a financial hole. The Catalans are still paying off old transfers, cannot fully settle with Lionel Messi, and are asking former employees to return phones and tablets. However, the team may stabilize by next summer. How did one of the most successful football clubs end up on the edge of financial collapse?

Barcelona is still paying Messi's salary and asking Xavi to return his phone

One of the world's most famous football clubs has been trying to fix its financial situation for several years. After the transfer window closed, it seemed like the worst was over. Still, Spanish media shared new details about Barcelona's ongoing financial struggles in October.

Journalist Juan Fontes revealed that Barcelona has ruined its relationship with its legend and former coach, Xavi. The Spaniard took over the club in 2021 but announced midway through last season that he would step down in the summer. Then, club president Joan Laporta convinced him to stay, only to fire him later that summer. Local media believe this caused the rift between the club and the coach.

Things worsened when the club sent official letters to Xavi and his coaching staff this fall requesting that they return the Apple phones and tablets they were issued when they were hired.

Barcelona's financial struggles are evident, as they continue to pay salaries to current staff as well as to former staff. Mundo Deportivo revealed that Barcelona still owes payments to Lionel Messi, Sergio Busquets, and Jordi Alba. Messi left the club in 2021, and Busquets and Alba departed in the summer of 2023. Nevertheless, they all still receive payments.

These payments are due to agreements signed during the COVID-19 pandemic. The pandemic severely impacted the club — player salaries had to be paid in full. At the same time, revenues plummeted due to suspended tournaments and empty stands. Barcelona had to negotiate deferred payments with its top players.

The club owes €147 million for old transfers

Barcelona owes other clubs as well as its players. Since 2021, the club has been buying players in installments, unable to afford single-payment transfers. According to AS, by mid-October, Barcelona owed other clubs €147 million for past transfers.

Barcelona still hasn’t fully paid for the transfers of Raphinha, Ferran Torres, Robert Lewandowski, Vitor Roque, and Dani Olmo. The case of Lewandowski is notable because Barcelona still owes money to seven clubs.

Lewandowski was purchased from Bayern Munich for €45 million, of which €20 million is still unpaid. However, when buying mature players, the purchasing club must pay solidarity payments to the teams that developed the player. Five Polish clubs still await these payments, though none are owed more than €400,000.

For example, Leeds United still needs €42 million of the €52 million due for Raphinha, and Manchester City is expecting €26 million for Ferran Torres. In all these cases, the parties initially agreed on payment plans. However, Barcelona’s debts still limit its ability to buy new players.

The club nearly lost an additional €1 million, but a regular employee of a Cypriot bank saved them. In 2022, Barcelona transferred money to a scammer who posed as Robert Lewandowski’s agent, Pini Zahavi. A bank employee warned Barcelona about the suspicious transfer, which led to the funds being blocked and eventually recovered.

The crisis was triggered by an inflated wage bill

Barcelona's massive financial problems became public in early 2021 when Joan Laporta became club president. He held a press conference revealing the club's total debt of €1.35 billion. It turned out that 103% of Barcelona's income was spent on player salaries.

Laporta blamed his predecessor, Josep Bartomeu, for the club’s financial woes. He accused Bartomeu of luring players with inflated salaries the club couldn’t afford. Another criticism was the huge payments made to intermediaries who weren't even official agents. These intermediaries were paid more than €40 million in total.

The COVID-19 pandemic further damaged the club's financial standing, forcing Laporta to devise strategies to save Barcelona. These led to the "levers" that allowed the club to continue operations and buy players by selling its media company, stadium naming rights, and a portion of future TV revenue.

Laporta promised to fix the situation within two years, but that deadline has passed. One clear sign is the case of Dani Olmo, purchased this summer from RB Leipzig. The midfielder missed the first two La Liga matches because he couldn’t be registered due to financial fair play regulations. In Spain, clubs must adhere to the "1 to 1" rule, meaning they can only spend on new players what they earn. If a club overspends, the player cannot be registered. This is what happened with Olmo.

By the end of the transfer window, Barcelona hadn’t met the "1 to 1" rule. Still, Olmo was eventually able to play in La Liga. This was possible because of an injury to teammate Andreas Christensen. La Liga allows the registration of new players outside the rule if they replace a long-term injured player, and Christensen was out for several months.

The situation might change soon. Spanish media report that the club is about to sign a record-breaking sponsorship deal with Nike, which will help Barcelona meet the "1 to 1" rule. This will allow the club to be more active in the transfer market and immediately register new players.

Published by Patrick Jane
21.10.2024