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Making sense of big-money Premier League transfers

SENIOR ANALYST
Editor's Pick
Published Aug 07, 2016
Aug 07, 2016 IST
Emanuele Giaccherini
Emanuele Giaccherini has moved back to Italy with Napoli after his spell at Sunderland

Explaining Lower-Ranked Teams’ Transfer Activity

When Emanuele Giaccherini took the decision to move from Italy’s biggest club, Juventus, to Tyneside club Sunderland in 2013, many eyebrows were raised. Some more eyebrows were raised when Conte came to a press conference to clarify that Juventus’ sale of the player was because the club needed to raise transfer funds.

2013-14 was the season when a new Premier League television deal was signed by the League with broadcasters Sky and BT Sport, guaranteeing the league an income of over £3 billion every season from just the sale of TV rights for broadcasting. Distributed across the league according to each team’s final league standing, this would guarantee a minimum of over £60 million to even the last-placed team in the league. 

From 2016-17 onwards, this amount will increase by around 70% for each time once more, with the Premier League doing a wonderful job again in getting investments to the clubs that participate in the competition. This enables even mid-table and relegation-battling clubs like Sunderland, West Ham, West Bromwich Albion, Southampton, Swansea and Stoke City, among others, to shell out top dollar for players from other European leagues.

Toby Alderweireld was an Ajax academy product, before making his way to Atletico Madrid in 2013. Getting precious little playing in time in the face of a high level of competition, Alderweireld was then happy to move from the reigning La Liga champions to Southampton on a loan deal for a season, before making a permanent move to Tottenham, who were still in the Europa League at the time.

Valon Behrami, who was once a crucial part of Napoli’s Champions League-qualified squad and who is a regular in the Swiss national team setup, signed for newly-promoted Watford for the 2015-16 season. Xherdan Shaqiri, Marko Arnautovic and Bojan Krkic are a mercurial trio of talented attackers who are currently at Stoke City, signed at cut-price deals.

What gives feeder clubs leverage

The presence of such elite players in even the lowest-placed Premier League teams has triggered a market phenomenon that is common practice today. Major European clubs sign their players up to longer contracts with teasingly high release clauses as soon as they run into a spell of good form. 

They know there will be a lot of money on offer for their best players, so clubs like Borussia Monchengladbach, Bayer Leverkusen, Wolfsburg, Lyon, Marseille, Napoli and Lazio, among others, have used this practice to their own financial advantage quite often. The player in question is also happy to sign such contracts, as he receives quick repayment for his run of good form in terms of a better contract in the present and better future prospects, should any club choose to trigger the release clause in his contract.

Explaining Top Teams’ transfer activity

The release clauses in players’ contracts are quite often inflated, but now that even mid-table Premier League clubs have access to money of the kind that clubs from the rest of the continent don’t, the clubs in the top 6-7 places now have to pay much higher transfer fees for marginally better players. 

As a matter of fact, Arsenal were able to break their transfer record easily and sign Mesut Ozil for €50 million in 2013. This expenditure was mainly possible for the management due to the prospect of greater television revenue for the incoming season (Arsenal earned £121 million from broadcasting revenues in the 2013-14 season).

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A season later, Manchester United used this improved television revenue to break the Premier League record and sign Angel di Maria for the record sum of £59.7 million from Real Madrid, while also using it to afford Radamel Falcao’s ridiculous loan deal with AS Monaco in a transfer expenditure of nearly £150 million in the summer.

This spending eventually pushed them over the edge at the fag end of the season, into 4th place on the Premier League table, making them eligible for another comeback to the Champions League qualifiers. The net spend of United was used to sign Daley Blind from Ajax, Marcos Rojo from Sporting Lisbon, Ander Herrera from Bilbao and Luke Shaw from the typical Premier League feeder club, Southampton.

The British transfer conundrum

Luke Shaw, Calum Chambers, Dejan Lovren, Rickie Lambert and captain Adam Lallana moved as part of the annual summer exodus from Southampton, as has been the case for them in the recent. Shaw cost United a total of £28 million, despite being only 18 years old at the time, with just one full season for Southampton under his belt. Similarly, Calum Chambers was sold for £16 million to Arsenal, while Lovren, Lambert and Lallana moved to Liverpool for a combined total of close to £50 million.

These players have been sold for greater fees from Southampton than the expenditure they made on players who replaced these departures in the squad, and they did quite brilliantly to allow the Saints to finish one place and 4 points higher (7th) in the ‘14-15 season. Their buys included Graziano Pelle, Ryan Bertrand, Dusan Tadic, Sadio Mane, Shane Long and Fraiser Forster for the tidy combined amount of £70 million. In addition, Southampton also brought in Djuricic and Toby Alderweireld on loan, further boosting their squad strength.

Of these players, Pelle and Mane have been resold by Southampton at excellent prices (especially Mane, who fetched them £34 million this summer). All-in-all, they have raked in the moolah from transfer activity without significant loss in their squad strength or league position, keeping their TV revenue intact.

Most of their profit has been from selling British players, who have typically cost more than a comparable international player at the same position and of the same calibre. This has also been used in the past by clubs like Newcastle (Andy Carroll’s failed Liverpool transfer immediately comes to mind), Aston Villa, Swansea, Norwich and Sunderland, among others. 

Although players like James Milner, Theo Walcott, Gareth Bale, Aaron Ramsey and Jordan Henderson have eventually done justice in critics’ eyes at their respective clubs, most such transfers have not gone well for the clubs involved and the player has been resold. The tradition of having to pay extra for young British talent has not expired yet, with Ross Barkley’s astonishingly high release clause that has continuously enticed clubs like Manchester City and Chelsea looking for a home-bred core of players.

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