João Félix

OccupiedPalestineBlues

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Yes, but I think player values are amortized, not depreciated, since they are viewed as intangible assets?

You’re absolutely correct. You certainly know your onions Svennis (Dennis I presume?).

I was trying to convey that the initial asset valuation (purchase cost) reduced annually by a percentage relative to the number of years of the contract - which is amortisation (as depreciation would presume that the asset value reduced by more than amortisation - such as if the players legs fell off - thus making the asset depreciate very tangibly) but I was trying to get it across using terminology that most people would be familiar with.

PS. I’m not pretending to be an accountant btw. Though I have run a few P&Ls down the years, with the support of some excellent MAs, and so have a fair grasp of the way that assets values are managed in a business.
 

Hart of the Matter

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They still owe 70m of Felix's transfer fee. 2 years into a 7 year contract. Market has been suppressed. We owe nothing against Bernardo but he would be a loss if he went.
They will want to at least clear their books and add to the squad without any additional cost/debt.
Would expect a 70m fee and a player in exchange...
Not sure he is worth it..
 

PrezIke

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They still owe 70m of Felix's transfer fee. 2 years into a 7 year contract. Market has been suppressed. We owe nothing against Bernardo but he would be a loss if he went.
They will want to at least clear their books and add to the squad without any additional cost/debt.
Would expect a 70m fee and a player in exchange...
Not sure he is worth it..

Sorry, I still struggle to understand why Atleti is expecting the same/close to the same fee they got for Felix (so no 70m + Bernardo should be expected) given what I'll explain more below: Atleti also sold Griezmann just PRIOR to buying Felix.

But again, unless I'm missing something here...

Whilst amortisation we now know is how most of these massive sales/buys work...

Atleti will also BENEFIT from this same thing and what I will say is in direct relation to what I've written here so many times this season I feel like I've lost track (not your fault there's a lot of users and posts.

Here's one LONG one I wrote in the Harry Kane thread:


Here's a quote explaining my issue with the constant reference to Felix's release clause and expected fee which I will relate to this argument.

You can read the 2nd sentence I have annotated with "***'s" on either side and italicised to get to the clear point, but you can read A) to see the actual numbers I am about to again refer to:

  1. I didn't compare Griezmann to Felix, other than their wages, nor did I mention anything about their release clauses (I'll answer to that in a moment).

    ***I pointed out the fees Atletico received for Griezmann and paid for Felix combined with the difference in their wages to show that the net loss between selling Griezmann and buying Felix was a few million Euros.***

    A) I'll reiterate the flaws I see with and respond to the argument I hear regularly that Atleti won't sell Felix for less than what they paid (€126m).

    The maths regarding the loss of fee paid for Felix minus Griezmann's fee was -€6m, so why would it have to be no less than the €126m fee they paid for Felix? As an example, if Atleti sell Felix for €80m they get a €74m profit.


    Then factor in less wages for Felix over 2 seasons and that 6m figure drops, compared to the cost of keeping Griezmann's higher wages.

    B) As for the high release clause for Felix, yes it is a preventative measure and yes, and shows they value him. Yet, we know that they are likely never going to get anything close to it. It is that high due to Neymar, yet he was an aberration.

The point is that wouldn't based on what is being stated here that Atleti ALSO CUT wages for Griezmann and will be getting amortised payments from Barca themselves that should help cover the loss to be a fairly small amount ON ITS OWN.

COVID's impact on economics/club finances and Felix's desire to remain in a side that won the league but didn't play him or help his "brand" / reputation as he barely played and doesn't get the chances is another factor that might LOWER the fee Atleti can expect whilst still making very large gains from a sale at the price I listed above.

That means NO NEED to throw in Bernardo for a cut rate fee and pay 70m. That seems terrible to me based on where Felix - who I think would be a great signing - but let's be real. His value is low as it has ever been.
 

PrezIke

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In which case the initial cost will be annualised over that longer period. The mention of 5 years was just as an example.

The point I was trying to make was that, in accounting terms, the value of the player starts at the full initial buying price and then reduces, in the same way that the value of an asset with a termination date is reduced annually in any business.

There seems to be a common thought that if a club pays x amount for a players services then, if the player is sold for less than x the club takes a loss, but that’s not necessarily the case because depreciation is a factor.

And, of course, the player could improve during the contracted period of hire, in which case the forces of supply and demand could make the player more valuable than the book value / bring a profit - though that dissipates too as the players contract runs down.

Fantastic insights here mate. Cheers
 

PrezIke

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I presume Atletico still owe Benfica a sizable percentage of the fee. With a new stadium to pay off, that has been empty for 18 months, I think they have every reason to cash in.
Yet, are Barca exempt from paying what they owe Atleti for Griezmann?

Nope. Did they then go on a spending spree a la Barca besides that buy? No.

So Atleti should be adding the incoming fee, amortised I gather, for the Griezmann sale to their revenues to help with covering some of these losses.

I can also still see Atleti cashing in on Felix given several variables, but I keep contending the fee does not have to be what was paid to count as a net gain and worthwhile.

This is something I read and hear almost ad nauseam at this point.

Recently I heard a City pod contributor who I have and fans give a lot of deserved respect state this as reality in a recent video on a fan channel.
 

Keeper!

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They still owe 70m of Felix's transfer fee. 2 years into a 7 year contract. Market has been suppressed. We owe nothing against Bernardo but he would be a loss if he went.
They will want to at least clear their books and add to the squad without any additional cost/debt.
Would expect a 70m fee and a player in exchange...
Not sure he is worth it..
70m plus Bernardo, not a chance we would do that.

Straight swop or slight cash adjustment from us.
 

Hart of the Matter

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Sorry, I still struggle to understand why Atleti is expecting the same/close to the same fee they got for Felix (so no 70m + Bernardo should be expected) given what I'll explain more below: Atleti also sold Griezmann just PRIOR to buying Felix.

But again, unless I'm missing something here...

Whilst amortisation we now know is how most of these massive sales/buys work...

Atleti will also BENEFIT from this same thing and what I will say is in direct relation to what I've written here so many times this season I feel like I've lost track (not your fault there's a lot of users and posts.

Here's one LONG one I wrote in the Harry Kane thread:


Here's a quote explaining my issue with the constant reference to Felix's release clause and expected fee which I will relate to this argument.

You can read the 2nd sentence I have annotated with "***'s" on either side and italicised to get to the clear point, but you can read A) to see the actual numbers I am about to again refer to:



The point is that wouldn't based on what is being stated here that Atleti ALSO CUT wages for Griezmann and will be getting amortised payments from Barca themselves that should help cover the loss to be a fairly small amount ON ITS OWN.

COVID's impact on economics/club finances and Felix's desire to remain in a side that won the league but didn't play him or help his "brand" / reputation as he barely played and doesn't get the chances is another factor that might LOWER the fee Atleti can expect whilst still making very large gains from a sale at the price I listed above.

That means NO NEED to throw in Bernardo for a cut rate fee and pay 70m. That seems terrible to me based on where Felix - who I think would be a great signing - but let's be real. His value is low as it has ever been.
Thanks for the clarification and cross reference to Griezeman. That makes more sense of the overly hyped fee paid in the first place.
Felix is also on huge wages, even compared to all but 2 of the City squad, that can also impact on transfer fees.
Like him as a player but cannot see it happening.
 

LongsightM13

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70m plus Bernardo, not a chance we would do that.

Straight swop or slight cash adjustment from us.
Any cash adjustment would need to be heavily in our favour. Bernardo is a significantly better player than Felix, a multiple champion and on a long contract. Just because Atletico grossly and disastrously overpaid for him doesn’t make him worth anywhere near Bernie’s value in the real world
 

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