For us mere mortals, the notion of extravagant January spending is an alien one.
That buzz of getting paid early in December fades quickly when the cost of everything you justified by simply saying ‘it’s Christmas!’ comes home to roost in the bleakest month of the year. But while you were agonising over whether that midweek takeaway was fiscally responsible, Chelsea Football Club were out there chucking £300m about the place.
Capturing Benfica midfielder Enzo Fernandez for a British-record £105.6m on deadline day takes spending under the Todd Boehly regime to a quite staggering £550m in less than 12 months. Boehly, if you need reminding, is the US businessman who swept in to take the London club from Roman Abramovich after the oligarch was heavily sanctioned in the UK Government’s response to Russia’s invasion of Ukraine.
He is he co-founder of Eldridge Industries and worth an estimated £3.5bn. So, while his wealth does not touch the Abu Dhabi and Saudi Arabian-backed regimes at Manchester City and Newcastle United, Chelsea have embarked on a spending spree which has outstripped anything other Premier League clubs have attempted.
Boehly has laughed in the face of popular opinion that January is a ‘difficult month to do business’ by simply throwing evermore ridiculous amounts of cash at it. 22-year-old Fernandez has just 83 professional appearances to his name, but is now the most expensive footballer in the history of the British game.
His arrival follows that of Mykhailo Mudryk for £88.5m, also just 22 with 66 senior outings under his belt. It is a quite startling transfer strategy, reminiscent of Abramovich’s relentless splurge after his arrival in 2003, a landmark moment that changed English football forever.
On reflection, in trying to do it all at inflated cost in just a few weeks instead of spending carefully over time, there’s perhaps more in common with Chelsea’s signing strategy and my Christmas shopping than I initially thought. It does, however, remain a hazardous way to do business, especially in the age of Financial Fair Play.
So, how are Chelsea pulling this off without falling foul of UEFA’s, and the Premier League’s, regulations?
Well, Boehly and his board have taken the unusual step of signing players on extended contracts; Mudryk has signed a deal until 2031, Fernandez likewise. The FFP-mindful school of thought behind this is it allows Chelsea to mitigate the immense cost of these players via a process called amortisation; spreading the fees over a period of eight years on the books and, therefore, greatly reducing the annual cost. On the flipside, clubs do not report received transfer fees in the same way. For example, the £12m Chelsea received from Arsenal for Jorginho this week is recorded as a single lump sum, further offsetting the big fees they are paying out.
It is a way of exploiting FFP that does not currently fall foul of any rules – although moves are being made to change this - and a key part of Chelsea’s strategy. By frontloading investment in young players with world class potential (and potentially huge resale value) on long-term deals, Boehly, and co-owner Behdad Eghbali, are banking on being able to supercharge an ailing Chelsea’s return to the top of English and European football. If the likes of Mudryk and Fernandez prove to be successes, the club will not only benefit greatly on the pitch , they will be in a strong position should any of the continent’s superpowers come calling in want of their top stars.
But there is also a considerable element of risk. If these players fail, Chelsea will be left to count the cost of a poor investment tied down on a multi-year contract, which likely then makes getting rid of them rather difficult. This is a new regime, of course, but the club’s track record in the transfer market is not exactly flawless.
Wasting £97.5m on Romelu Lukaku springs to mind, Kai Havertz and Christian Pulisic have justified their respective £75m and £58m fees in recent years, while Boehly and Co. look to have overpaid in spending £56m on Brighton’s Marc Cucurella last summer. In terms of the club’s financial health, multiple experts have commented that income, transfer outgoings – at which Chelsea are very efficient – and the amortisation trick mean the strategy is unlikely to be financially ruinous.
But whether it proves viable in building an elite football team remains to be seen. Chelsea have hardly sparkled under manager Graham Potter and face the very real prospect of not qualifying for the Champions League next season, a development which would inhibit their ability to spend further. They currently sit 10 points behind fourth-placed Manchester United and current form does not offer much encouragement that a charge back to the top of the table is imminent.
READ MORE: Premier League clubs spend record £815m in January transfer window
They are, of course, banking on Mudryk and Fernandez to help change that, but these are young players moving to a league which often proves difficult to adapt to – expectation of an immediate, transformative impact could prove premature, and the ensuing criticism they would face only makes it more difficult to develop in the long term.
Boehly and his team, however, are clearly confident in their recruitment process, and there has been a marked shift to signing players aged 18-23 instead of last summer’s scattergun approach, one which brought in 33-year-old Pierre-Emerick Aubameyang and 31-year-old Kalidou Koulibaly at significant expense.
Whether this will work out remains anyone’s guess. Even if it does, something wouldn’t feel quite right about branding the purchase of the world’s biggest-name young players at astronomical cost as ‘shrewd business’. What seems absolutely certain, however, is that whatever happens next will not be dull.
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