Good day gooners…. by Paul N
In my first look at the Cesc “Buy Back/Sell On” clause I seem to have mis-interpreted an important part of the analysis of the clause. (In Indian accent: Thousand apology’s sir) lol.
In the original article I said “Some urgency will arise to try & at least recoup some of the £35m already spent by trying to sell Cesc. … blah.. blah.. blah.. .. If they sell to anyone else but AFC, they make a loss of £35m as the 50/50 sell on split cancels each other out.”
This is not entirely correct because it may seem that there is a threshold that the sale must reach for Barca to break even after they have paid the 50% sell on fee. Barca has to sell for £70m or more to break even or profit.
This is how it works…
If Barca has £100m & pay AFC £35m, then sell for £70m – give AFC another £35m – then Barca is left with the same £100m they started with (100-35 + 70-35 = 100), breaking even. Anything less than double what you paid will result in a loss i.e. If Barca has 100m & pay AFC £35m, then sell for £60m – give AFC another £30m – then Barca is left with £95m which is a £5M loss (100-35 + 60 -30 = 95).
The confusion is created when you link the 50/50 sell on fee with the initial sale, this is corrected when you consider the above examples in the following context: if Barca spent £35m up front & parted with £35m later as the sell on fee the books will show £70m went out & £70m came back in.
There is still an urgency!
However, even if you look at the deal now with revised/corrected probabilities, there still is an urgency for the Barca board to manage the situation attentively. As with any player a club buys, there is a risk that the player might not perform or may become disgruntled for some reason or the other. And if such a situation arises then the race is on for the board/manager to try & resolve the problem…
Which way the Barca board or manager chooses to go? only time will tell.
Thanks for reading. (Sorry once again guys.)