Barcelona 'set up holdings company with own money in order to inflate value of sales'

It has been reported that Barcelona have jointly set up a holdings company and have used their own money to buy assets in order to inflate the value of sales. 

According to Spanish radio COPE, the Catalan club have put €150 million of their own money to inflate the sale price of their first two levers, which included the 25% sale of their TV rights to the US private equity group, Sixth Street. 

In June, Sixth Street bought 10%, before buying an extra 15% in July. 

Barcelona said in their official statement that they sold the TV rights for €667 million, but Sixth Street only paid €517, with the remaining €150 million reportedly coming from Barcelona’s own money. 

It was reported that Barcelona did not sell their TV rights to Sixth Street directly, they decided to set up a third company which Sixth Street invested €517 million in, whilst Barcelona invested €150 million.

While the club only received €517 million from the sale, they declared the sale as €667 million, which included the €150 million they had to spend. They managed to amortise the €150 million over the next 25 years, which meant the books only showed a spending on €6 million. This generated an extra €144 million on top of the actual €517 million they received. 

In much simpler terms, the money did not exist as it was simply accounting tricks. 

However, La Liga did not accept this as proper income for the salary limit calculations. As a result, the club are yet to register any of their summer signings.

In addition to their already mounting problems, the deal will reportedly be classified as Capital Gains, meaning they would have to pay a Capital Gains Tax, in Spain the tax is around 23%. 

Therefore, after trying and failing to do an accounting trick, they now have to pay an extra €37.5 million in tax. 

So far this summer, Barcelona have been splashing the cash on a number of new signings. Andreas Christensen, Franck Kessie, Robert Lewandowski, Raphinha and Jules Kounde have all arrived at the Camp Nou. Whether they will be able to play for the team in their opening La Liga fixture against Rayo Vallecano remains to be seen. 

Meanwhile, the club continue their efforts to offload players in order to balance the books. Top of their unwanted list is midfielder Frenkie de Jong, who is currently the club’s top earner. However, the 25-year-old is said to be settled in Barcelona and is refusing a move away amid interests from Premier League giants Manchester United and Chelsea.