Financial crisis affects European transfer market
Reuters - Tuesday 03 February 2009, 21:23
LONDON - Record spending by English Premier
League clubs, mainly billionaire-backed Manchester City and
Tottenham Hotspur, could not hide the effects of the credit
crunch on soccer's January transfer market.
Premier League clubs spent about 160 million pounds ($227.7
million), six percent up on January 2008 with City and Spurs
accounting for more than half.
Elsewhere, market conditions were more austere, with the top
flight clubs in Europe's four other major leagues between them
spending less than England's Premier League alone, according to
business advisory firm Deloitte.
"European transfer markets as a whole have been
extraordinarily quiet, and much of the activity in England has
been in the form of loans and short-term contracts," Simon
Chadwick, professor of Sport Business Strategy and Marketing at
Coventry University, told Reuters.
In Italy, spending dropped by about 43 percent at about 29
million euros ($37.29 million) compared to 2008, according to
media estimates. In many cases official fees were not disclosed.
German clubs spent a little over 16 million euros for 42
player transfers. Hamburg made about 14 million pounds from the
sale of Nigel de Jong alone to Manchester City but used only a
small part of that cash for new singings.
Real Madrid were the only Primera Liga club to buy big,
spending around 40 million pounds to sign Klaas-Jan Huntelaar
from Ajax Amsterdam and Lassana Diarra from Portsmouth (pictured).
LOAN DEALS
Abu Dhabi-backed City, the world's richest club, set the
highest level of spending by any club in a January transfer
window, Deloitte said. City shelled out a reported 50 million
pounds, despite their failed record bid for AC Milan's Kaka.
With concerns mounting about the sustainability of revenues
from ticket sales, sponsorship deals and television contracts,
loan deals which do not impose long-term costs on a club have
been a frequent solution.
"This transfer window was much quieter than in the past.
There is no money on the market," said Bruno Satin, head of the
football division at the sports management agency IMG.
Although transfer expenditure has dampened, there is no sign
of a narrowing of the gap between Europe's richest clubs and the
rest, an issue that UEFA said last week was one of its main
concerns for this year.
Several club officials, including the president of the
European Clubs Association, Karl-Heinz Rummenigge, have called
for the introduction of player salary caps.
But Giovanni Palazzi, president of the Italy-based StageUp
sports business research unit, said: "A salary cap may not work
properly in Europe, due to clubs' different financial models."
Satin, who is also a players' agent, added: "In our job, the
problem is that a number of players are paid more than their
real value... A salary cap could be a good idea, but we are
still far away."