Football fans are more than aware of the travails that clubs have to face to compete in the top divisions, especially those who get promoted for the first time. Some clubs spend heavily with no regard to the future, and then face a very depressing time when reality catches up with them, case in point Leeds United. For other clubs, the costs involved in staying in the top flight for a sustained period become too much to bear, and like Portsmouth, end up in administration.
There have been a few clubs of late who have found it difficult to sustain themselves. Italian club AC Siena, who had been plying their trade in the Serie A as recently as the 2012-2013 season before being relegated, declared bankruptcy this year. AS Cannes, home to such French stars as Zinedine Zidane and Patrick Viera, no longer exists as a football club, after being ruled that its financial situation is too dire for it to continue.
Clubs having financial trouble is nothing new. Even the biggest clubs of the world have debt that they service every year. What fans will find surprising in these modern time is that there is a club that doesn’t have any debt at all.
A model club
SD Eibar is not your standard romantic club that fans like to talk about. In all the years that they have existed, this is the first time they are making an appearance in the top division of Spain. Just like Athletic Bilbao, they are situated in the Basque region of Spain, but do not insist on the same rules of playing only players from the region. They are located in an area that has about 27,000 people in population, and their stadium, the Estadio Ipurua, holds around 5000 people.
But the important thing about SD Eibar is that they don’t owe a single Euro to anybody, in the form of debt. They have made this journey to the top Spanish football league through their own resources, and getting players on loan from their neighbours, Real Sociedad and Athletic Bilbao. They have been the development ground for Spanish stars Xabi Alonso and David Silva. Even their kit is “borrowed”, having been given the Barcelona kit back in 1940 as they didn’t have one for themselves.
It would have probably been easy for them to borrow money and try to take a shot at getting to the La Liga sooner, but that approach has been resisted. Even their wages are minimal, and in fact will be the least of all the clubs in the La Liga this coming season. Perhaps some will call them a club with no ambition, but living within your means can never be foolhardy.
It’s not like they will be a walkover for all the established clubs. Javier Irureta, coach of the 2000 La Liga winning Deportivo la Coruna, had this to say, “I think players like Messi will feel pretty uncomfortable because they’re not used to such a small stadium, where the crowd is so close to you and where you’re not playing on the perfect carpet of the Camp Nou.”
But this debt free club seems to have been given a cruel hand to deal with. La Liga rules state that a club that has been promoted to the top division must be able to raise capital that will cover a minimum 25% of their expenses. This rule was put in to deal with the excessive amount of debts and unpaid taxes that football clubs had racked up.
“When you know that Spanish soccer is in financial chaos, it seems both ironic and unfair that the rules have been designed to try to sink one of the few clubs that is financially sound,” Alex Aranzábal, Eibar’s president, told NYTimes.
As a result, the club have been forced to sell the shares at a price of 50 Euros, and since no one can own more than 2% of the shares, it has not been possible for star players like Xabi Alonso to send a big cheque to help them. He, of course, did the next best thing, appealing on Social Media to help save the club.
Another headache the club had to face with their promotion to La Liga is the fact that all stadiums are required to have a minimum seating capacity of 15,000 within 2 years of promotion. That is a cost that they wouldn’t have wanted to bear. For now, the club has only built one additional stand so that the capacity increases to around 6000, with the idea being that if they survived for one more season in La Liga, then they would think of expansion.
It does seem unfair that a club that has made it to the top purely based on living within its resources has not been given an exception for these rules. Surely, the rules can be amended to exclude clubs that have no debt to not have to worry about raising capital?
In the words of the president, “Really nothing about joining La Liga has been easy for us.”