Joan Laporta asks for faith to ensure the Club returns to a sound financial footing
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FC Barcelona has held an ordinary meeting of the Senate, a collegiate and honorary body of an advisory nature, comprised of the thousand longest serving Club members. The previous annual meeting of the Club's senators took place in 2019, having been postponed since due to the COVID-19 pandemic restrictions. The meeting's agenda focused on introducing the two topics to be addressed in the upcoming Extraordinary Assembly on Thursday, June 16, which will be held virtually. Delegate members will be able to decide whether to approve the activation of two financial "levers" that Joan Laporta considers essential for the Club's future.
“We can now announce that if the fanbase shows their faith on June 16, we can return to a sound financial footing earlier than expected within this mandate, via the activation of a series of mechanisms to bring us back into the black, pay off the debt and make the investments required for our professional teams to be more competitive. This will all take place under the criteria of financial sustainability and prudence to ensure the errors of the past are not repeated”, was the message conveyed by FC Barcelona's president to the Senate, referring to the approval of the sale of a minority share in BLM and the cession of up to 25% of the income derived from the LaLiga TV rights.
Laporta chaired the meeting held in Auditori 1899, alongside most of the Board of Directors, and over one hundred senators were present. The past two years have seen 120 members added to the FC Barcelona Senate.
The evolution of an ailing Barça
For the first point on the agenda, the president evaluated the season and FC Barcelona's current situation, which the Board of Directors are tackling with encouragement and optimism. Prior to reaching this conclusion, however, Laporta harked back to the situation they encountered when they assumed control on March 17, 2021, and the tough obstacles they have had to overcome. The president compared the Club to a patient who “was practically dead in financial terms”, and that after many months of work, looking for solutions, “restructuring the debt and making financial savings, reducing the sporting and non-sporting payroll, increasing income and working on financing for Espai Barça, we are reviving Barça in the ICU thanks to the intensive care we have administered”.
With the search for tools to refloat the Club's economy "with the only objective that Barça remains owned by its members", Laporta ensured that if the delegate members approve these financial measures, "we will move Barça on to the ward to complete the cure so that it can soon leave the hospital and lead a normal life”. According to the president, the Club has the means to compete against state-supported clubs because “after months of work, we can confirm that Barça as an institution remains full of life, with an impressive ability to attract capital, to generate income, and most importantly, without losing its independence in terms of the governance and ownership models”. The president insisted that “we want a strong Barça because this Board of Directors is committed to Barça completing against the emerging powers of state-supported clubs or clubs owned by millionaires in the coming years, using our assets, our strength, our badge”.
Therefore, the Assembly on June 16 is essential in order to confirm the financial recovery, which is why Laporta asked “all of you and all the delegate members to keep faith in us to enable this Board of Directors to activate two options that should bring us financial stability”. “We need this room to move to turn things around and close the financial year with a profit, which is what we committed to, after three years of losses. However, we are not going to align ourselves with the best bidder, rather the partner that most understands the nature of our club”, stated the president, who ensured that these levers “will be limited over time with repurchasing mechanisms put in place”. Laporta also really emphasised that "we will not endanger the Club's future", rather that "with your permission, we will soon make Barça stronger than our competitors who have all nature of advantages in financial terms, but that not all the money in the world could buy our spirit, out history, and our way of understanding sport, society, and the country”.
Lastly, Laporta also explained the current situation regarding the Espai Barça project to the Club's Senators, and reminded that the remodelling works for the future Camp Nou can begin once the Club has been granted a licence from Barcelona City Council. However, the demolition of the third tier has been postponed to summer 2023 due to the war in Ukraine, with minimal disruption to the works schedule as it coincides with the move to the Estadi Olímpic Lluís Companys on Montjuïc, with works expected to end in the 2025/26 season. The president also explained that the Club is still working on financing within the parameters approved during the referendum, whereby the amount that must not surpass 1.5 billion euro, and that the project will also be financed by the additional income that Espai Barça generates itself once complete.
Eduard Romeu presents the matters for the Assembly
Economic area Vice President, Eduard Romeu, was responsible for presenting the financial matters that will be addressed and voted on during the Assembly on June 16. These involve Barça Licensing & Merchandising (BLM) and the television rights.
On BLM, Romeu indicated that the upcoming assembly will vote whether to approve one or more investors obtaining a minority share in BLM, a company owned completely by FC Barcelona with responsibility for the Club's licensing and merchandising business.
Despite the negative effects induced by the pandemic, BLM has been and remains a significant source of income for the Club with major potential given the strength of the Barça brand and the millions of fans worldwide. It has shown a post-pandemic upturn thanks to return of tourism, the games played in the stadium, and the Club's e-commerce.
Vice President Romeu stated that "we don't have the capacity to reach across the world ourselves to enhance and enlarge the business internationally, and we need the collaboration of strong partners to help us increase both the business and income that comes through this channel".
Barça's economic area vice president also discussed the second matter that will be addressed in the Assembly regarding approval to cede up to 25% of the income from the television rights for the competition organised by the Liga Nacional de Fútbol Profesional to one or more investors.
These rights are distributed based on the following criteria: all clubs receive an equal share of 50% of the rights; a further 25% are based on the fanbase (attendances and ticketing/membership), an aspect in which we are a leading Club, and the remaining 25% is based on sporting merit over the last 5 years (LaLiga position).
The TV rights are sold over 3 to 5 year windows. This is a simple lever, according to the vice president who stated “that it offers income stability and consistency over time, which is why the risk to the investor that wants to place their trust in us is very relative".
Eduard Romeu asked the senators present for a vote of confidence in the current board of directors: “Our partner has to understand that we have competing bids in order to choose the best option. We have to feel assured by them".
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