The Messi Situation: Explained

 THE MESSI SITUATION: EXPLAINED

  ̴Mitansh Kagalwala

credit: OneFootball

On August 5^th, FC Barcelona shocked the world by dropping the news that Leo Messi would be leaving the club after 18 years. Despite contract talks being positive just a few hours ago, and the club and the player himself agreeing to contract details, Barcelona could not resign Lionel Messi due to structural and financial problems.

FC Barcelona’s financial problems have been well documented in the previous year. The incompetence of the previous board coupled with the Coronavirus Pandemic hastened the financial breakdown of the club.

One of the biggest problems in regards to the financial structure of the club is the club’s massive wage bill. Club President Joan Laporta recently said that even without Leo Messi’s wage, player salaries would account for 95% of the club’s income, which should ideally not be above 70%. Barcelona’s huge wages have been the main driver of the club’s financial downfall, along with poorly executed transfers.

That is not to say Barca didn’t try their hardest to retain the best player in the world. Messi had been willing to sign a deal with reduced wages, as much as a 50% reduction, but Barca couldn’t get the deal across the line due to it being non-compliant with La Liga’s Financial Fair Play Rules. Barca had two deals lined up for Leo, firstly a two-year deal payable over 5 years, and then a separate five-year deal, but La Liga termed both to be non-compliant of their FFP rules.

Barca reportedly would have been able to sign Messi if they had accepted La Liga’s proposed deal of a 2.7 billion euro injection from CVC, which would have seen Barca take approximately 260-270 million euros, but Laporta said he was not willing to gamble on the risky deal for short term gain, considering CVC’s investment was way below the actual worth of 10% of La Liga. After all, nobody is bigger than the club itself, not even the best player in the world.

Current FFP rules state that, in a summary, a club cannot spend more than it has earned, in order to prevent the rich clubs from running away with the leagues and to keep sporting integrity. The rules also differ league from league, and La Liga has one of the comprehensive FFP regulations. Due to the Coronavirus pandemic and stadiums being shut, the income of clubs was significantly reduced, and so was their spending power. Barcelona have also been unable to get rid of fringe players with huge salaries, such as Samuel Umtiti, Miralem Pjanic, Phillippe Coutinho and Ousmane Dembele which would have reduced the wage bill tremendously, enough for Barca to sign Messi. Some of these players have even refused to reduce their wages.

Hence, Barca have been unable not only to sign Leo Messi but to register any of their new signings as they would go over the salary cap allowed by La Liga’s FFP rules.

IMPACTS OF MESSI LEAVING

Of course, the best player in the world leaving the club will have several adverse effects on Barca. Obviously, they will be less of a threat on the football pitch and will have to get over their Messidependencia. Further, they will lose one of the most marketable assets in the world in Leo Messi. Messi was named the most marketable athlete of 2020 by SportsPro. Barcelona was also tremendous money in shirt sales; currently 8 out of 10 shirts sold are Messi’s. Barcelona’s contracts with their sponsors, such as Beko and Rakuten, have a “Messi” clause that can increase the sponsorship amount by huge amounts. Barcelona will also have to adapt to a new system that is not built around the creative talents of Leo Messi.

WHAT NEXT

Lionel Messi, reportedly heartbroken about having to leave Barca, will still have to look for a new club. The current favourites are PSG, who seem to have agreed a contract with him, and to whom FFP rules don’t seem to apply. Next in line are Manchester City, with their “Pep” pull and New York City FC as part of the City Football Group. Another option out of left field is David Beckham’s Inter Miami. Messi might also instead choose to return home to Argentina and boyhood club Newell’s, where it all began.