Investment in soccer is currently at an all-time high, as a result so are the levels of debt that clubs are incurring. Stadium construction costs, player salaries, and increasingly expensive transfer fees are all major contributing factors to the enormous levels of debt incurred by the world’s top soccer clubs. These clubs stand to make enormous profits if they can overcome their financial obligations and soccer clubs have become a trendy investment for billionaires around the world.
Clubs have offset their ever increasing costs by passing on the expenses to the fans. Ticket and merchandise prices continue to increase for fans desperate to see their favorite clubs take the pitch and wear the gear of their heroes. These fans are the lifeblood of the sport, which relies on their continued investment and attention in order for the businesses to remain solvent. Savvy fans that wish to see changes in their club have staged protests and boycotts to achieve what they view as necessary changes for the benefit of the club.
In soccer, as in all businesses, a certain level of debt is acceptable. However, some of these clubs have grown increasingly unstable because of their excessive debts. Several have experienced recent changes in ownership or structure. Others have had to make sacrifices in order to offset the cost of building new stadia. The trend of enormous spending in soccer does not look to be changing anytime soon. With that being said, here are the twenty clubs that have amassed the most debt.
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20 Borussia Dortmund - €55.3 million
Borussia Dortmund has announced that they expect to be debt free by the end of the 2014 fiscal year. This is a truly amazing feat for a club that was bailed out by their biggest rival, Bayern Munich, ten years ago. Dortmund has rebounded fantastically and is an example of how the financial regulations of the Bundesliga can even benefit the largest clubs in the league. Dortmund has been able to remain solvent despite losing one of their biggest assets, Robert Lewandowski, on a free transfer, instead of receiving the enormous transfer fee he was expected to incur.
19 Manchester City - €69 million
Manchester City has benefited greatly from the investment of owner Sheikh Mansour. His continued investment has allowed the club to purchase top quality superstars like Sergio Aguero, Yaya Toure, and, most recently, defender Eliaquim Mangala. Their last two campaigns have ended with them lifting the Premier League trophy, but they have struggled in UEFA Champions League play. Head coach Manuel Pellegrini has brought them success, but continued investment will be necessary to keep them at the top of the Premier League table.
18 Tottenham Hotspur - €70.4 million
Tottenham Hotspur has had to deal with a lot in recent seasons, including the departure of their best player Gareth Bale. Tottenham received a record transfer fee for the Welshman and utilized the fee to invest in several young talents that have found varying degrees of success. Despite their constant presence in the top half of the Premier League table, they have been unable to find their way into the UEFA Champions League. Tottenham has also recently had plans approved to build a new 56,000 seat stadium, which will surely increase this debt in coming years.
17 West Ham - €98.6 million
West Ham has benefited greatly from their extended presence in the Premier League. Beginning in 2016, they will play their home games in the Olympic Stadium, which will replace the Boleyn Ground that has been their home for over 100 years. Sam Allardice has kept West Ham safely in the Premier League, where they have adopted a philosophy of making the most out of their investments. Once West Ham is able to play their soccer in a greatly expanded stadium, debt levels should dramatically decrease.
16 Sunderland – €100 million
Sunderland managed a fantastic escape from relegation last season, which has enabled them to continue playing their football in the Premier League. Despite their sustained presence in England’s top flight, Sunderland continues to invest sparingly on players with large transfer fees. Their invested wisely by acquiring Billy Jones and Costel Pantilimon on a free transfers and the once-promising Jack Rodwell for a fee rumored to be around £10 million.
15 Arsenal - €119 million
Arsenal has been forced to limit investment on player transfers in recent seasons in order to offset the cost of the construction of the Emirates Stadium. During this time, manager Arsene Wenger has come under fire for being satisfied with Champions League qualifications, rather than challenging for a league title. Arsenal fans are forced to pay the most expensive ticket prices in the league in order to see their team play. However, this season has seen a change with Arsenal spending big on Alexis Sanchez, Danny Welbeck and Mathieu Debuchy.
14 Liverpool - €146 million
Liverpool has had a tumultuous summer following the departure of superstar Luis Suarez. They have purchased a Southampton trio of players, several young talents, and the always controversial Mario Balotelli in order to replace him. Last season’s second place finish elevated Liverpool back to the status of an elite club, but their continued presence in the top 4 is far from assured. After a four year absence, Liverpool has returned to the UEFA Champions League, giving the club a valuable alternative revenue source.
13 Atletico Madrid - €168 million
Atletico Madrid has enjoyed a fantastic run of success in the last few seasons. After winning the UEFA Europa League in 2011-12, Atletico Madrid made an improbable run to the UEFA Champions League Final, where they narrowly lost out to cross-town rivals Real Madrid. They lost several players to expensive transfers away from the club, but have rebounded fantastically by splashing the cash for Mario Mandzukic, Antoine Griezemann, and Alessio Cerci. Diego Simeone seems to have found the winning formula at Atleti and is already on his way to becoming a club legend.
12 Newcastle United - €170 million
Newcastle United are currently in dire straits as a football club. Beleaguered owner Mark Ashley has frequently come under fire for his role with the club and the status of manager Alan Pardew is constantly a topic of discussion by members of the media. The club endured relegation to the Championship in 2008-09, but has struggled to find success in England’s top tier since returning. As a result of their declining status, Newcastle was forced to sell Yohan Cabaye who sought top quality football with Paris Saint-Germain.
11 Inter Milan - €178 million
Inter Milan, like their rivals AC Milan, has fallen on hard times in recent years. As a result, the club sold the majority of shares to an Indonesian consortium led by Erick Thohir. Inter failed to qualify for the UEFA Champions League, which deprives the club of a valuable revenue stream for the upcoming season. As a result, Inter was forced to spend wisely, and has acquired several players on loans and free transfers in order to boost their squad. Their lone transfer splurge was €12.5 million to Cardiff City for the signature of Gary Medel.
10 Juventus - €206 million
Three consecutive Serie A titles have done little to ease the burden of debt on Juventus. Their Continassa project to bring a hotel, shopping, and training center outside of Juventus Stadium has been approved and advanced payments to the city of Turin have been necessary. They have also purchased Alvaro Morata for a sum of €20 million in their most significant off season investment. Juventus saw an 11.3% increase in revenue, while their operating costs increased by only 8.6%. Once the Continassa project is completed, they should be financially stable for the foreseeable future.
9 Bolton Wanderers - €209 million
Bolton Wanderers chairman Phil Gartside has been eager to downplay worries about the club’s enormous €209 million debt. Following their relegation from the Premier League, Bolton struggled in the Championship, finishing in mid-table, far from challenging for a return to the top flight. The vast majority of the debt is owed to club owner Eddie Davies, so the club is not restrained by the burden of interest payments. However, the club may find some difficulty to return to the Premier League and remain compliant with Financial Fair Play regulations.
8 Queens Park Rangers - €226 million
Despite making their return to the Premier League in 2014, Queens Park Rangers has been saddled with the enormous debt of €226 million. The club has plunged into the transfer market in recent seasons and has been forced to pay the remainder of fired manager Mark Hughes’ contract. Owner, Tony Fernandez, has had a difficult year as the owner of both Malaysian Airlines and the London based club. The club recorded a loss of £65 million last season, the largest loss reported by any club in England.
7 Aston Villa - €242 million
Aston Villa owner Randy Lerner has announced that he has placed the club up for sale. So far, he has had no interested parties. Lerner was among the first American investors in the Premier League and has had mixed success during his eight years with the club. Last season, Aston Villa reported a loss of £51.8 million, despite lowering their operating costs by £9.5 million. The club’s inability to earn a spot in European competition has limited their revenue generating capabilities.
6 AC Milan - €250 million
AC Milan owner and former Italian President, Silvio Berlusconi, has been forced to cut back on his investment in the Italian football club. As a result, Milan has not been able to qualify for European continental competition. The club has gone through several mangers including former club legend Clarence Seedorf, but finished 8th in Serie A last season. The club sold controversial striker Mario Balotelli and Bryan Cristiante in order to offset some of the costs incurred during the last season.
5 Barcelona - €287 million
Last season, FC Barcelona announced their club had posted record income of €530 million, which they used to reduce the debt by a total of €44 million. The club then invested significantly by purchasing the services of Luis Suarez, Ivan Rakitic, Thomas Vermaelen, and Marc-Andre Ter Stegen, among others, which cost the club in excess of €140 million. The club will now be prohibited by UEFA sanctions from making purchases during the next two transfer windows, which should allow the club to further reduce their debts.
4 Valencia - €320 million
Valencia CF has fallen on hard times in recent years, which forced the club to be sold to Peter Lim. Over the last few seasons, Valencia has been forced to sell several superstars, including Juan Mata, David Villa, David Silva, and Roberto Soldado in order to keep the club operational. Lim reached an agreement with the club’s primary creditor Bankia, in order to reduce a portion of the amount owed. As a result of their financial hardship, Valencia was forced to abandon their new stadium construction on the Nou Mestalla. They revealed updated plans for the project last season, but reduced the capacity of the stadium and underground parking lot.
3 Manchester United - €377.8 million
Manchester United is one of the richest clubs in the world, but the club’s failure to secure a place in either the UEFA Champions League or Europa League has cost the club significantly. Despite the announcement of a record annual revenue of £433.2 million, the club saw a decrease in profits. United’s new jersey sponsorship deal with Chevrolet is contingent on Champions League qualification this season. This has not deterred Manchester United from spending this summer, with the purchase of Angel Di Maria, Daley Blind, and the expensive loan deal for Radamel Falcao.
2 Real Madrid - €602 million
As a result of significant debts incurred in recent seasons, Real Madrid has been forced to sell the naming rights to their stadium, the Santiago Bernabeu. Real Madrid spent in excess of €100 million in the transfer window to acquire James Rodriguez, Toni Kroos, Keylor Navas, and a loan deal for Javier Hernandez. Some of these costs were offset by the sale of Angel Di Maria, but was mostly used to pay off their short term creditors. Despite their significant debts, the club does not look to change their outrageous spending ways anytime soon.
1 Chelsea - €1,225 billion
Chelsea is in a unique position in that all of their existing club debt is owned by a holding company, which insulates both the club and their billionaire owner Roman Abramovich. The Russian oligarch has pumped cash into the club since taking over as the owner, and recently spent in excess of £80 million this summer to bring Diego Costa, Felipe Luiz, Cesc Fabregas, and Loic Remy to the club. So far in this season, his investment seems to be paying dividends. Diego Costa has racked up eight goals in five matches, while Cesc Fabregas has contributed several crucial assists.
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