Lille and Inter Milan’s post-title financial burden and what it means for the future of Football.
The two clubs Lille and Inter Milan pulled out a miracle winning the league in France and Italy respectively. But they are also an example of a Covid related economic crisis, foretelling why football might be broken beyond repair for some clubs.
Lille OSC are Ligue 1 winners going into the Champions League group stage as a tier 1 club and €150m in debt nonetheless. Inter Milan are the breaker of chain in Serie A after 9 consecutive league title for Juventus, and the same Inter Milan were unable to pay their players a full wage. These 2 incidents show the inevitability of economic problem for Football among a stand out pandemic of Covid-19.
In Europe, the transfer market has been ultimately dominated by most of the premier league teams. When Leicester won the premier league in 2016 and pulled out a major upset, it skyrocketed the top tier teams net spend on the transfer window. The summer transfer window turned frenzy all of a sudden. In the last 5 years, premier league teams have spent €6.3 billion on transfers alone.
Lille’s fairy tale story without a happy ending.
The situation is similar in ligue 1, only here there is just one club with the economic prowess; Paris Saint Germain. Basically in the 2021 transfer window, if there are to be considered any winners it must be them. To have signed Achraf Hakimi, Sergio Ramos, Georginio Wijnaldum, Gianluigi Donnarumma and Lionel Messi in the same transfer window and still managing to meet the financial fair play criteria must be an eloquent thought for most others in the world, but not for PSG.
Moreover PSG did not win the ligue 1 title last season, they were held off by a motivated Lille team undergoing an economic crisis of their own. Their wild celebration after that final league game reflected the magnitude of their success but its unsustainability as well. When reality kicked in Lille found selling key players like Boubakary Soumare, Mike Maignan and Luiz Araujo.
In December 2020, Lille were sold to Callisto Sporting, a subsequent Luxembourg-based investment firm. The previous majority shareholder Gerald Lopez had been forced into a sale by the club’s outstanding creditors, an American private equity firm (EMC). Now after further study, one of the US’s Big Four Banks (JP Morgan Chase) had reported that Lille’s debts ranged from €130m to €200m.
Lille were hit worst in French football’s economic monsoon. Covid-19 decimated matchday revenue and then the league’s broadcasting deal with MediaPro collapsed. MediaPro had overvalued their €3.25bn bid. Their subscription channel Téléfoot needed four million paying customers to make profit; the actual number was reported at 600,000. This created a mid season fiasco for the French team, with no revenue coming from the stadium as well the economic impact was huge.
Lille’s economic suffering was already bad before Covid spread its wings. They dangerously moved into a 50,000-seater stadium in 2012 despite only showcasing an average attendance of 19,650 during their title-winning season in 2010-11. In 2018-19, the last full season with supporters, there were 16,000 empty seats on average. In 2016-17, Lille had the worst wage-turnover ratio, spending 106 per cent of their revenue on salaries. In the Covid era, teams with economic stability has suffered, so it was evidently possible for a team with problems before Covid to turn into a team beyond repair after Covid.
Inter Milan’s rise only managed to help them sell out their stars.
In Italy, the story was somewhat similar with Inter. After 11 years, last season Inter managed to hold onto the Serie A top spot with the help from an imperious form of Romelu Lukaku, the masterful coaching of Antonio Conte and the surging runs of Hakimi down the right flank. And these three leading members have already left the San Siro.
Inter’s Chinese owner Suning were hit particularly hard by the pandemic. Shares in the company were frozen in June as their financial problems worsened. Suning secured a $1.36bn state-backed bailout the following month, easing the gravest concerns about Inter’s future, but it wasn’t enough to secure Inter’s economic stability. The club failed to pay players on time last season and the squad waived their bonuses for winning the title to offer their support to the club’s off-field issues.
Nonetheless, Antonio Conte left early in the season, followed by the departure of their difference makers, the likes of Hakimi and Lukaku, with more players assumed to leave in the following years.
What this means for the future of these two clubs and football in general
Covid-19 was an unexpected emergency that no club or owner could feasibly have prepared for, but it merely proved the existing issues within the financial model of European football. As it has always been, economic giants like PSG, Chelsea and Man City seemingly continue to dominate the transfer market, now more than ever. Lille and Inter had pushed themselves to the limit for a blink of success and economic prowess, but with risk comes a chance of failure, and in a pandemic struck world the failure rate can be predicted to be high enough.
Lille and Inter act as a warning to other teams around the world. Bad management in clubs like FC Barcelona must not alone be considered as a learnable offense. Economical stability is as important for a club as winning trophies to maintain their name in higher regards for the future generations to come, and players need to show football can survive beyond economic instability, regardless of their personal gains.
Inter Milan has started the Serie A with success winning two out of two as they stand joint top in the league. But Lille were struck horribly bad managing only 5 points from 5 games. This is just the beginning. How far the economic impact can distress the situation only time will tell, but as of now there doesn’t seem to be many destined winners in this game.