Barcelona sell 10 percent of their TV rights for £178 MILLION

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Barcelona strike £178MILLION deal with investment group Sixth Street Partners to sell off 10% of their TV rights for the next 25 years… but sale does NOT mean Xavi can splash the cash in the transfer market

  • Barcelona have sold off 10 percent of their TV rights across the next 25 years
  • San Francisco-based Sixth Street Partners have paid £177.5m for those rights
  • Sixth Street Partners already works closely with Barcelona’s rivals, Real Madrid
  • The deal does not mean Barcelona can now spend big in the transfer market

Barcelona have announced the sale of 10 percent of their TV rights over the next 25 years to American investment firm Sixth Street Partners – but they still need to sell off more of the club if they are to move freely in the transfer market.

The deal for €207m (£177.5m) means the club can close the financial year without losses but it does not automatically mean they can register Andreas Christensen and Franck Kessie with LaLiga or push on with their bid to sign Robert Lewandowski.

The deal that Barcelona rejected last season between CVC and LaLiga for the cession of just under 10 per cent of TV rights over 50 years included the release of 15 per cent of the €270m (£231.4m) incoming to be used immediately on squad spending .

But deals with other partners will not have the same guarantee and they now need to negotiate with LaLiga over what percentage of this deal can be used in the same way.

Barcelona president Joan Laporta has sold off 10 percent of the club's TV rights for 25 years

Barcelona president Joan Laporta has sold off 10 percent of the club’s TV rights for 25 years

The San Francisco-based Sixth Street Partners are already working with Real Madrid having signed a deal to commercially exploit the club’s renovated Santiago Bernabeu stadium.

Barcelona members voted in favor of selling off part of its retail arm Barcelona Licensing and Merchandising (BLM), and part of its future TV rights revenue, last week.

At the time club president Joan Laporta said the deals could raise up to €700m (£600m).

The deal is massive for Barcelona given June 30 is the final day of the financial year for clubs

The deal is massive for Barcelona given June 30 is the final day of the financial year for clubs

It does not mean that they can register new players, such as incoming Andreas Christensen

It does not mean that they can register new players, such as incoming Andreas Christensen

HOW DOES LALIGA’S SALARY CAP WORK?

LaLiga introduced a salary cap back in 2013 in a bid to place more control on keeping member clubs away from major debts and repayments.

The salary limit for each team – they are individually worked out every season – is calculated by subtracting squad costs (fees, wages, bonuses, pension contributions) from total income generated.

That income is calculated from TV rights, sponsorship, money earned from LaLiga, club membership fees, publicity, and selling players.

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But so far progress has been slow closing the deals and this first sale is seen by LaLiga as the club moving in the right direction, but still falls well short of the sum of money Barcelona needs to invest to be able to start bringing in new players .

There is still time for Barcelona to sell off further chunks of TV rights money and the BLM parcel. If the club can close deals for €700m (£600m) they will swing the LaLiga-imposed salary cap from €144m (£123.4m) in the minus (as it stood last season) to something closer to €550m (£471.2m) ) in the positive.

That would still be above their current wage bill set at €560m (£480m) but then with a slight reduction in the wage bill they would finally be free of the 4:1 rule obliging them to spend only a quarter of revenue they bring in .

Barcelona were not the only club in Spain facing the prospect of closing the financial year with losses.

Atletico Madrid have admitted needing to sell a player for €40m (£34m) before July 1 in order to end the year without losses.

The admission about the state of the club’s finances came from president Enrique Cerezo.

‘You know that we are subject, like all clubs, to certain financial commitments,’ he said.

Barcelona boss Xavi Hernandez is keen to make multiple signings to bolster his squad

Barcelona boss Xavi Hernandez is keen to make multiple signings to bolster his squad

‘We will be able to sign what we can sign. I believe that in order to sign, we all need to sell.

‘We have to sell for €40m; that’s the position we are in. The market is not easy.’

Despite that public admission they are not expected to move any players out today.

Valencia are understood to be €70m (£60m) short of closing the year without losses and Sevilla, who sold defender Diego Carlos to Aston Villa earlier this month, are believed to be set to announce €30m (£25.8m) losses.

Recording losses reduces the spending limits set by LaLiga although none of the aforementioned clubs expect to be given a spending limit in the minus as Barcelona were last January.

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