We’re not buying a packet of peanuts. We’re talking about an eighty million euro transaction. There are a lot of fine details to work out. And when attorneys are involved it takes days to go over the finer details of such a contract. It took me several months to close a seven million dollar deal, albeit with significantly lesser resources. People seem to think it’s a casual conversation, a few scribbles on a piece of paper and voila.
The lack of basic business knowledge and experience that people use as their basis to criticise the speed of transfer negotiations, is really laughable. Payment structures, currency fluctuations, proof of funds, structures and parameters of add-ons, default protections and contingencies are just some of the complicated factors. Then you have to factor in the speed at which the other party responds and their amenability and flexibility with regards to how and when payments are made. Barca are likely fairly keen to get most of the money up front, given their economic situation. That can greatly complicate things because a lot of transfer activity and budgeting is predicated on installment payments over 3-5 years.
Our transfer budget, which is in itself a ludicrously simple moniker for such capital investment, isn’t reflected in how much cash we have sitting in a big chest. We may have 90m on hand but a so called budget of 150 or 200m dependent on payment structures. It is also influenced by the payment structures of outgoing deals, and liabilities still owed on past transfers both incoming and outgoing.
An offer in this case is a proposed package based on constant and fluid conversations addressing all the myriad factors of the transfer. Agreement has to be reached on all of them. It can be the case that a player can be bought for 75m if the entire fee is played up front or 85m if they are paid for over 4 years. The time value of money is more relevant than ever given currently excessive inflationary pressures. Then factor in Barca’s complicated current financial circumstances and the weighting is probably heavily leaned towards a larger up front payment, which places a lot of stress on United’s immediate cash flow, and rightly the club will be looking for certain concessions in such an eventuality; because a heavily weighted up front deal for FDJ will necessitate that other deals in this window don’t require substantial up front cash requirements. That in itself changed the budgetary outlook for the next 3-5 years. Furthermore, if the club need to access a credit facility to fulfill the up front cash requirements on this transfer or subsequent transfers, then the cost of money also needs to be factored in.
But yes, ridiculous it might take a few days. Sigh.