Alisher Usmanov’s fear that Arsenal would be unable to compete with the Premier League elite without further investment, appears to have been supplemented byArsène Wenger’s recent comments to the press. Usmanov underwrote a rights issue in July 2009, aimed at slashing Arsenal’s debt, and generating funds for transfers and wages. The proposal was rejected by the board, but perhaps Arsenal’s recent plight deems the decision more debatable.
Yesterday, Wenger yielded to the grumblings of discontented Arsenal fans by choosing to explain the reason behind Arsenal’s inactivity in the January transfer window. Wenger has suggested that, contrary to reports, Arsenal cannot compete financially with England’s elite clubs. Whilst funds for transfers are available, Arsenal cannot afford the wages offered to top players by their rivals in the Premier League and abroad. Wenger told the Times,
“If you go on high transfers you go on high wages… it is linked, but we cannot afford both. We cannot make a statement to Ancelotti because Chelsea can lose £150 million and we cannot live like that. Football lives in an artificial world at the moment. We have to live in a realistic world at Arsenal and we are very proud of that.”
Arsenal is one of the richest clubs in Europe, and boasted a club record turnover of £313 million for the last financial year ending 31st May 2009. However, Arsenal are burdened with debt from the building of the Emirates Stadium, as well as becoming victims of the downturn in the property market with regard to the Highbury Square development. Arsenal’s resulting debt is considered to be around £300 million, and whilst the club has no trouble servicing this debt, the club does not have excess resources to compete with the likes of Chelsea or Manchester City in terms of wages or transfer fees. For example, the club’s annual wage bill stands at £104 million, whilst Chelsea spent £172 million last year. Wenger is proud that Arsenal are a profitable business, and Wenger’s moral superiority is justified when one considers the ‘artificial world’, as Wenger phrased it, that clubs such as Chelsea and Manchester City live in. On 6th January 2010, Manchester City reported annual losses of £92.6 million. The figure is staggering when it is remembered that Manchester City’s £125 million summer spending spree is not included in this figure. Even at Stamford Bridge, despite their repeated desire to break even, Chelsea announced annual losses of £44.4 million in December 2009.
Whilst Arsenal fans will doubtlessly be proud to support a morally superior football club, some followers of the club, in lieu of Wenger’s recent comments, will be disappointed that the Arsenal chief executive Ivan Gazidis and the Arsenal board of directors, did not agree to the rights issue underwritten and proposed by Russian oligarch Alisher Usmanov. The rights issue proposed by Usmanov would have eaten up a large chunk of Arsenal’s debt, and allowed Wenger to spend a portion of the club’s huge turnover on wages and transfers. However, the board turned down the proposal, with fans alike, worried Usmanov’s Red & White Holdings were merely attempting to increase their current 25% share in the club. With fans feeling that they are no longer competing with the Premier League’s elite, and with Manchester City’s owners set to continue spending, Usmanov’s proposal may be an avenue worth exploring for the Arsenal board, if they are to attract one or two stellar names, that most pundits believe would transform Arsenal from bridesmaid to bride. Further, Usmanov stated in July that he would be happy to invest in the rights issue and remain a 25% share holder in the club. Perhaps this is the only way Arsenal can prevent falling further behind the pack, without having to resort to a ‘sugar daddy’, that Wenger so detests in Chelsea’s Roman Abramovich and Manchester City’s Sheikh Mansour.
Better news does appear on the horizon for Arsenal however, with Marouane Chamakh, the Bordeaux striker, reportedly set to sign for Arsenal on a free transfer at the end of the season, according to various reports.