By Sergi Escudero
Barcelona, Mar 12 (efe-epa).- Joan Laporta, the new FC Barcelona president, faces a Herculean task to address the club’s massive debt burden of $1.4 billion.
Out of this, $870 million have to be paid in the short term, and negative working capital of $600 million is required to find quick solutions to rescue the iconic club.
To address this, Laporta has chosen different people from the economic sector to help him into his second stint as the president.
He started with Jaume Giro as the club’s new economic vice president.
Giro was the CEO of La Caixa banking foundation between 2014 and 2019.
Giro accompanied Laporta during the electoral campaign to explain how the team would reverse the sinking fortunes of the Catalan club.
After winning the presidential vote on Sunday with 30,184 votes, Laporta announced another significant appointment for the institution’s economic restructuring.
Ferran Reverter, the CEO of MediaMarktSaturn retail group, will now replace Oscar Grau as Barca’s CEO.
Laporta’s economic roadmap could include the following steps:
– Refinancing debt with banks: FC Barcelona has to repay 266 million euros of the 730-million short-term debt to banks before Jun.30.
It seems impossible if the club has to pay player salaries and supplier and electricity bills. The only solution seems to be negotiating with the banks on refinancing the debt to medium or long term.
– Issuing bonds: Due to the lack of liquidity, Laporta’s team has come up with the idea of issuing bonds worth 400 million euros, especially targeting pension funds, and also to Barca fans ready to invest in exchange for unique experiences still in the design phase.
– Reducing monthly salaries: Although the board under Carles Tusquets managed to reduce the monthly payments to the first soccer team by 172 million euros to 506 million, further cuts might be required.
These could come in the form of renegotiating player contracts, as the revenue forecast for the current season is just around 650 million euros.
“Naturally there would be football assets that would have to be disinvested at some point,” Giro had told EFE in an interview during the electoral campaign.
Other projects that could help bridge the gap between income and responsibilities include selling up to 49 percent stake in the assets clubbed under “Barca Corporate,” such as Barca Studios, Barca Licensing & Merchandising, Barca Academies, and Barca Innovation Hub.
Espai Barca, the massive infrastructural project that includes the construction of multiple sports facilities, could also be a major source of future revenues.
The title rights of Camp Nou could also fetch a big paycheck for the club.
While the club might be taking a milder approach with the sponsors after the pandemic, the marketing head of the club, Cinto Ajram, told EFE recently that the institution would aim to generate 250 million euros annually in sponsorship revenue.