When Andy Carroll was sold for £35M, Alan Pardew said that Mike Ashley told him the money would be reinvested back into the club.
Mike Ashley – Newcastle owner
In the old days, when things were a bit simpler, we would think that £35M could be used on transfer fees to bring in new players – very simple to know where the money had gone.
So if Newcastle brought in two players for £10M each and three for £5M each – so be it – that’s how the £35M was spent.
But Alan said the money would be used for the new players’ wages too, and that has muddied the waters big time, so the truth is we’ll never know where the money will go, because it all starts to get very complicated.
Some of it will be spent on ground improvements, and we know that under-soil heating is being installed at the Benton Training ground, and that’s good use of some of the money.
As far as wages go – if Cabaye, Marveaux and Ba are on say £30K/week (it’s probably more) – that’s around £1.5M/year for every player year of the contract – and since they have 5, 5, 3 year contracts (13 years in total) between them – then that’s around £20M (13*£1.5M) right there going to wages over the length of their contracts.
So it will be very easy – if you include wages – to say you have spent £35M this summer – and in any case that money is paid over the lifetime of the contracts – and so interest will be being accrued on most of that £35M too.
It’s going to be hard to show how Mike Ashley will spend that £35M – and of course Kevin Nolan has gone, so his wages are no longer on the books – so it really does become complicated
Newcastle could sign three more players this summer (for no net transfer fees being paid out) and then point to the £35M being spent on all the wages of the players brought in.
And if Barton and Enrique go this summer, it could well be that Newcastle make money in the transfer market – they could have a net plus in net transfer fees coming in.
And then Barton’s and Enrique’s wages (around £100K/week) will be off the books – so tell me again how you can work out how £35M was spent on wages and transfer fees?
It becomes very difficult believe me, and I’ve thought through this a bit, and once wages are brought into the equation it becomes very murky.
But once September rolls around we’ll give it our best shot of course, given which players have come and gone between now and then.
And if enough suitable players are not available this summer, there’s a decent argument to be made that the money should not be spent just for spending’s sake.
We just don’t know enough about the financials at Newcastle, but maybe some of that money will be used to pay off the loans Ashley has made to the club, which are said to be at least £130M, although the news is that Mike is not looking to be paid that money any time soon.
And please, this is not meant to be Ashley bashing, it’s just that having looked at players’ wages – it’s going to be difficult for any of us to know just exactly where that money was reinvested back into the club.
And we all shouldn’t all jump to any conclusions yet either, because the transfer window still has a good two months to run – so some good new players could still arrive on Tyneside.
If we get another three top players on Tyneside this summer, and we can keep Joey and Jose, we think most fans will be happy enough come September – independent of what money has been spent.
That’s really the bottom line.