Money Matter$

Liverpool reveal £20m transfer spending cap

Can the Reds compete with the big boys on such a budget?

Liverpool fans protest at Hank Hicks and Billy Bob Gillett

Hank Hicks and Billy Bob Gillett’s popularity on Merseyside ranks somewhere between The Sun and cancer, and they won’t be winning any praise from Liverpool fans for their fiscal planning. According to an investment prospectus uncovered by Bloomberg News, the club’s forays into the transfer market will be limited by a £20m spending cap until 2014.

The Daily Mail reports:

The startling revelation was published in a prospectus back in March by investment banks Rothschild and Merrill Lynch to attract potential investors in the club.

The £20m spending cap, which will also include wage increases accruing from contract renewals, means that Anfield boss Rafa Benitez must continue to sell before he can buy over the next fives years as Liverpool chase their first league title since 1991.

While the majority of Premier League clubs froze or lowered their season ticket prices this season, the document revealed that Hicks and Gillett were also considering an eight per cent hike in admission fees to cover some of the club’s debt. This idea was eventually scrapped, but revenue streams will be created with the addition of 1,000 corporate seats at Anfield, some Liverpool-branded academies, secondary sponsors and the improvement of catering facilities at the ground.

The transfer cap will obviously come as bad news to Liverpool fans, who saw Xabi Alonso, Alvaro Arbeloa and Sebastian Leto sold to make way for a crocked Italian, a cast member from The Wire and a random greek chap this summer.

Plans for a fancy new stadium stadium have also been put on hold until the “economic situation improves“.

So, will Liverpool still be able to compete with the rest of the Big Four/Big Five with such a limit on spending? Let us know your thoughts below…

3 responses so far
  • 4everfootball // September 24, 2009 at 9:41 pm

    They can always recruit locally unless crime proves more lucrative than football.

  • Local Hero // September 24, 2009 at 10:17 pm

    It’s funny you know, £20m spending cap. Sure it’s not what fans want, but the game is fat with money. In fact, it’s obese.

    £20m pound is a lot of money and the money spent in football is a nonsene. Wages, transfers, sponsorship its crazy. The valuation of football in general is way over the top and situations like this need to happen. The very fact that this fee is considered a cap on spending says it all.

    Too many average players being overpriced and sending even teams like Liverpool into a budget is a warning. It’s all about greed because people want more and more. Whilst clubs like Liverpool are capping spending, clubs of the same size and potential can only dream of capping – instead they marvel at being able to spend £20m.

  • St. Anfield // September 25, 2009 at 3:06 am

    OK, but the reality is that this story, and the prospectus itself, is dated. March? Forever ago. We spent more than £20M this summer and subsequent to that was the Standard Chartered deal. The new sponsors have pumped £80M into the coffers which H&G have sworn will come to the club. Not to mention the untold ££ we’ll all be shelling out for 3 new bloody kits next summer.

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