By David Owen
August 30 – Summer transfer spending by Premier League clubs is set to surge to record levels in coming days, triggering concerns that the latest TV bonanza risks being frittered away rather than used to strengthen club finances.
Figures supplied to Insideworldfootball by Deloitte, the professional services firm, put gross Premier League spending to date at £430 million – up 20% from the same point in last year’s window.
With the window not due to close until Monday night, and with £100 million or more spent on deadline day in each of the past two seasons, the current record of £500 million, set in 2008, looks sure to be broken.
The last big transaction included in Deloitte’s £430 million is Brazilian star Willian’s move from Anzhi Makhachkala to Chelsea for a fee believed to have been £30 million.
Net Premier League spending – at £333 million – is running at over double Deloitte’s £156 million total for the same point in the 2012 summer window. However, Gareth Bale’s imminent exit from Tottenham Hotspur for an expected world record fee is likely to bring the 2013 aggregate down.
Alex Thorpe, a consultant in Deloitte’s sports business group, said that, with “significant business still to be done ahead of the deadline and several deals looking to be very close”, it looked set to be “a record summer”.
On one level, this summer’s splurge is not particularly surprising: this is the first season to be covered by the league’s new set of broadcast deals which delivered a staggering increase of close to 70% in the value of domestic live rights alone.
The hope had been expressed though that, with regulatory scrutiny of financial sustainability increasing, clubs would use this latest revenue windfall to reduce cost ratios and bolster slender operating margins.
To be fair, the revenue uplift is such that they may still manage to do this.
Said Thorpe: “It is important to consider this in the wider financial context of the Premier League…
“Transfer spending this summer…is still likely to be less than the total incremental revenue clubs will receive from these new broadcast deals.”
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