Barcelona Secures €100m Bank Loan To Pay Off Outstanding Wages – Sources

May 19, 2021
Soccer
2467245cb1d78ff5bf7b67db99173894 L

Barcelona president Joan Laporta has secured a loan from an American investment bank that will allow him to use €100 million ($122m) to settle outstanding payments owed to the players, various sources have told ESPN.

Laporta will be able to call on a credit line of up to €500m in total, according to ESPN sources, but will use only €100m for now to pay wages owed to the squad since January.

Barca’s players are paid a relatively low monthly salary, with the bulk of their earnings covered in two instalments — one paid in December or January and the other at the end of the season.

2467245cb1d78ff5bf7b67db99173894 L

The coronavirus pandemic has accelerated Barca’s financial problems and allowed the club’s gross debt to rise to almost €1.2 billion.

Since the start of the pandemic, Barca’s players have agreed to various measures to help, including a three-month pay cut last March and a payment deferral scheme earlier this season, but the club have still struggled to keep up with payments.

Sources told ESPN there was a genuine fear that if the club could not make up around 40% of the wage bill owed in backdated payments, the issue could have been taken to the Spanish Footballers’ Association (AFE). That could have led to potential sanctions for Barca, with one source highlighting, therefore, the importance of the loan obtained by Laporta.

Barca’s annual report budgeted for €230m to be paid in salaries to the first-team squad for the 2020-21 season.

The first thing Laporta did after being elected as president in March was to order an internal audit of the club’s finances.

That audit is still ongoing, but, in the meantime, a club source confirmed a more staggered repayment plan has been agreed with some of the note-holders of the short-term debt.

Per the club’s accounts, released in January, of the €1.173bn gross debt, €265m was owed to banks before June 30. Over €100m is also owed in amortisation on previous signings, in addition to what is owed to the players.

Barca had hoped a €350m cash injection from the European Super League would ease their financial problems, but the collapse of the project forced them to seek alternative streams of investment.

ESPN reported in April that Laporta was forced to step up his search for outside investment after the plans to form a breakaway competition failed

Leave a Reply

Your email address will not be published. Required fields are marked *

WP2Social Auto Publish Powered By : XYZScripts.com