Often revered as one of the greatest and greatest football clubs of all time, Real Madrid has over time shown how influential and powerful they are, both on and off the field. During the economic crisis caused by the pandemic, European clubs and leagues are unable to make ends meet for their growth. Even big clubs like Real Madrid other FC Barcelona they are also succumbing to the wrath of the pandemic.
Real Madrid are known for spending a lot on players and infrastructure, but are now facing a disastrous financial situation, leaving them far behind in terms of wealth from European clubs, especially England’s big six. To find a way out of this delicate situation, Real Madrid bosses backed the idea of the European Super League to eliminate the risk of financial burdens and gain monetary freedom.
It all started in 2009, when Real Madrid president Florentino Pérez started plans for super league competition, as he thought the UEFA Champions League was outdated and problematic for the sport. He believed it was an obstacle preventing clubs from growing their businesses and developing infrastructure. Since then he has been in contact with the owners and bosses of the biggest European football clubs. According to Pérez, the need for new competition increased in 2020 since the biggest clubs began to fall prey to financial turmoil due to the COVID-19 pandemic, racking up massive debts. Real Madrid was one of the most affected institutions that received a great financial blow in Spain. With this development, Pérez felt it was absolutely imperative to make the concept a reality, as his club was in the deep sea of debt.
Growing debt in Los Blancos
Before continuing, it should be known in advance that the 13-time Champions League winner published the last financial report in January 2021. This report revealed that the club had a huge debt of approximately 901 million euros. Madrid have a short-term debt of 203 million euros, which puts them in a much better position than their rivals, FC Barcelona, who only owe 126 million euros for transfers between 19 different clubs. The historic club was assumed to be saving money to sign a great player like Kylian Mbappé or Erling Braut Haaland by signing zero players during the previous two transfer windows. However the latest financial report He suggests that the chances of Real Madrid signing a galactic are bleak.
Of the debt of 901 million euros, the champion of Spain has a net debt of 355 million euros. The amount of 114 million euros of net debt is attributed to the renovation of its spectacular Santiago Bernabéu stadium. The renovation project will cost the club a colossal € 796.5 million, including interest on the loan. This project is supposed to come with multipurpose potential that is said to generate annual revenue of 1 billion euros.
To mitigate the financial burden, Real Madrid decided to sell Achraf Hakimi, Sergio Reguilon and Oscar Rodríguez, while players like Gareth Bale and Borja Mayoral were sold. In addition to these departures, Luka Jovic and Martin Odegaard were expelled as loans during the winter transfer window.
How would the European Super League have cooled the financial difficulties?
With everything considered, especially their financial situation, it is not surprising that Real Madrid together with Barcelona and Juventus are at the forefront of the idea of the European Super League. The best clubs in Europe expect guaranteed income and income. The Super League was conceived with a much more return than the Champions League.
The founding clubs were expected to receive more than € 10 billion in uncapped solidarity payments during their initial commitment period, along with a profit of $ 400 million for each founding member simply to establish a secure financial base, which turned out to be four times. more than Bayern Munich won after winning the Champions League in 2020. With the plan attracting significant interest, with US investment banking giant JP Morgan promising $ 5 billion for its establishment, things did not work out as expected. The reaction of the fans in England forced the six greats of the Premier League to withdraw from the lucrative project, while AC Milan, Inter Milan and Atlético de Madrid also decided to move away from the separatist league.
The collapse of the European Super League is a serious blow to Real Madrid. The Spanish club runs the risk of being left behind in Europe against other major clubs despite having the biggest pull in the world. Florentino Pérez has a difficult summer transfer window ahead of him. In addition to the economic tower, Real Madrid is likely to lose several players in the summer, with Sergio Ramos, Raphael Varane, Marcelo, Isco and Lucas Vásquez rumored to leave the club. Despite the looming challenges Real Madrid would face if its best players leave the club this summer, including a possible departure for Zidane, Pérez remains hopeful that ESL’s plan will finally be executed.
“We are going to continue working. The project is on hold ” Florentino Pérez said after nine of the 12 founding clubs withdrew from the proposed plan.