What Cazorla’s departure means for Ramsey and Wilshere

Morning all. Let me start by addressing yesterday’s blog where I attempted to explain the truth about transfer budgets, and how it actually works.

The short version was “Arsenal gave £50m to spend in the summer pre-sales, but this is not the transfer budget. This £50m is to be spent on increased wages and amortised transfer fees”. Do read the full version, click here.

I write a lot of rubbish, I write some stuff that I think is good. Often the stuff I think is good and well thought out gets just a few 100 hits. Whilst often the rubbish can get thousands.

Yesterday’s blog was not planned. I was in my garden, on a break from mowing my lawn, rum and lemonade in hand (yes, it was only 9.30am) and explaining for the umpteenth time about how transfer fees are spread across the length of the entire project. I decided instead of continually having to explain it, I’d write a blog.

I was not expecting the blog to take off how it did. Reading the response bought a smile to my face. It felt like a blog that enlightened those who read it. Explained to them how things worked. Added to their knowledge. So a big thanks to everyone that read it and shared it. To have the blog “liked” by Big Dave Ornstein was certainly a highlight.

Leading on from yesterday’s blog, one thing I spoke about was about how an increase in wages comes out of that pot of gold we have available to increase over all costs of the club. And that if you want to control wages, you often have to let players leave to free up further cash for new players.

And that is what has happened today as Santi Cazorla agreed to join Villarreal on a feee transfer.

It is sad to let the happy little Spaniard leave, but he is 34 in December and has had two years injury. He heart might be broken, but the head says we were right not being too aggressive offering him a new contract.

Cazorla was in £90,000 a week. That is £4.6m a year. A lot of money invested in a player who has not played.

You the have another outgoing player who has barely appeared this season. Per Mertesacker. He was on £70,000 a week. Another £3.6m a year.

Combined, the pair earned £8.2m between them last year. They played 365 minutes of Premier League football combined.

The reality is, unlike if Jack Wilshere or Aaron Ramsey left, neither Cazorla or Mertesacker has to be replaced to maintain the status quo. That means the £8.2m in wages, or £160k a week, can be invested back in the squad wherever we feel fit.

That is the wages paid for a world class player without changing our current transfer outgoings.

Then we come to Jack Wilshere. It seems being left out of the World Cup has made him re-think his future at Arsenal. Perhaps he has decided that he wants to be assured of first team football – a guarantee he will never get at a top club. The question for Wilshere is “how far is he will to drop for first team football?”. Is he really going to be happy at Everton, Wolves or Leicester?

If he does leave, that free’s up another £80,000 a week. Now let’s be silly.

Arsenal lose both Wilshere and Cazorla for nothing. For the £170,000 a week (£8.8m a year) we save in wages for both players, we go out and buy the world class central midfielder we need. Is that not a positive?

I love Wilshere, but he is not or every will be world class. If he does leave, it gives us a lot of flexibility to use his salary and Cazorla’s money on that top replacement, and still have plenty in the lot to buy a top defensive midfielder.

And finally Aaron Ramsey.

I honestly think he is playing a game with the club.

With Cazorla gone, it leaves us with 4 senior central midfielders – Ramsey, Wilshere, Elneny, Xhaka.

If Wilshere also leaves, Ramsey will know he can pretty much name his price. The club could not afford to lose Cazorla, Wilshere & Ramsey, leaving us with just Elneny and Xhaka. We would need to go out and buy another 3 central midfielders if that happened. Ramsey is waiting to see how the cards fall before deciding to go all in.

I expect he will stay, and be made captain.

So if Wilshere and Cazorla leave, we replace them with a single top midfielder, and use our current budgeted funds to buy a defensive midfielder, our strength I. The middle of the park would have grown. If we can get someone like Max Meyer on a free, even better:

Xhaka DM Ramsey

Elneny AMN Meyer

Enjoy your Sunday.



Arsenal’s “£50m budget” explained

The talk still continues. “Arsenal have a £50m transfer war chest”. As blogged about recently, the £50m war chest is nothing but a figure to add weight and clicks to articles.

Recently big Dave Ornstein mentioned a pre-sales budget of ~£50m. The reliable BBC man is the only journalist I have seen get closer to the truth in what we have to spend, as he discusses “pre-sales”.

In Arsenal’s history, we have only had a net transfer spend above £50m twice. So if the new manager is given £5 to spend, that is not the bad starting point that many make up.

The key point that very few journalists make is that Arsenal have around £50m to spend this summer. Not a £50m transfer budget.

“Arsenal hand manager £50m transfer budget” will get more hits than “Arsenal have £50m to spend on wages & transfer fee amortisation”. And then for the majority of gossip red tops, where journalists are paid to create hit garnering articles for advertising revenue, they do not have time to go into the truth. As the truth won’t sell.

So Arsenal do have around £50m to spend this summer – before anyone is sold. But this does not mean we have £50m to spend on players (ie it’s not as simple as a £30m goal keeper, a £10m centre back and a £10m midfielder).

We know Arsenal will have around £50m to spend based on club accounts, which have shown a consistent £40-£50m profit before player sales for the last few years. You can not spend money you do not have – unless you want to go into debt or be a rich mans play thing.

So basically, Arsenal can increase their costs of running the business, or the expenditure if you like, by about £50m and still break even as a business. What it does not mean is that we have £50m for transfers.

From this £50m budget, the club will have to to cover any increase in yearly wages, increase in agents fees and the amortisation of transfer fees.

Any increase in wages has to come out of it the £50m. They are part of the overall budget.

Salaries are a cost. If you increase salaries and keep income the same, profits reduce. So any increase in salaries needs to come out of that £50m.

That mean’s Aaron Ramsey’s new contract has to come out of that £50m. Also out of this budget will come the wages of any new players we sign.

Say we buy the 5 players we need – a goalkeeper, centre back, defensive midfielder, attacking midfielder & winger – and Ramsey signs his new deal, our wage bill will rise by about £30m. That £30m comes out of the £50m budget.

But then this increase in wage bill will be offset by outgoing players.

The likes of Mertesacker and Cazorla. Potentially Ospina, Perez, Campbell & Jenkinson. Maybe Jack Wilshere.

Wilshere aside, the 5 cost in the region of £15m a year in annual salary. So that means our net increase in salaries next year will be about £15m.

This £15m is above the £7m yearly salary increase laid out by the Premier League, but Arsenal can prove where the additional funds have come from so are able to circumnavigate the rules.

So we increase the yearly wage bill by about £15m. That leaves us with about £35m to spend on players.

“A £35m transfer budget, that is even worse” you scream loudly into Twitter. You are wrong.

We do not have £35m to spend on transfers, we have £35m to spend on amortised transfer fees.

At this point please note I have excluded agents fees as I imagine they will be at a similar level to previous years, so the cost does not increase and impact the budget.

Football clubs are allowed to amortise the cost of a transfer fee over the length of his contract. In layman’s terms, this basically means “spread out”.

So take Mesut Ozil. He cost the club about £45m, and signed a 5 year deal. So his transfer fee was spread across 5 years, resulting in his yearly cost impacting on the budget by just £9m.

This summer that original 5 year deal comes to an end. Ozil is paid up. That would actually give us an additional £9m a year within our current accounts to spend on a player. But we spent that £9m in January on Pierre-Emerick Aubameyang.

Aubameyang cost £50m, signing a 3 and a half year deal. This will cost Arsenal £14m a year, but with the saving on Ozil transferred across, Aubameyang actually only increases our costs by about £5m a year. Good deal.

With then have the Mkhitaryan / Sánchez swap deal. Sanchez’s transfer fee will be written off in the next accounts, Mkhitaryan cost us nothing. That is a saving to the club in amortised transfer fees of about £9m a year again (Sanchez cost less than Ozil, but had just a 4 year contract).

So we fast forward to this summer. We have established that we can increase the clubs outgoing by about £50m. £15m will be take up by wages, so what does the remaining £35m get you?

Straight off the bat, we could buy a £20m centre back on a 4 year deal – that is the figure quoted for Borussia Dortmund’s Sokratis (I am not going to attempt to spell his surname). £20m over 4 years will cost the club £5m a year.

We could then sign Jean Michael Serri. He reportedly has a £40m release clause. Hand him another 4 year deal. That works out at £10m a year I the accounts.

So we have “spent” £60m in two players, yet the impact on the budget is just £15m. Still leaves us with £20m.

We could then go big. £50m on a goalkeeper. Give him a 5 year deal. True cost is £10m.

That leaves us with £10m to play with. For that we could go out and get 2 £25m players and hand them a 5 year deal. Or sign someone like Max Meyer on free, leaving us able to spend another £50m spread over 5 years.

So let’s list what Arsenal could actually sign within their £50m budget

1x £50m player on a 5 year deal

1x £40m player on a 4 year deal

1x £25m player on a 5 year deal

1x £25m player on a 5 year deal

1x £20m player on a 4 year deal

£160m outlay on players, yet it will only increase our yearly outgoings by £50m. It is within the budget.

Of course, the club won’t want to be bang on break even, as this leaves little wiggle room in future transfer windows. Although as previously signed players transfer fees become fully amortised, this frees up cash.

And this does not even include any profit we make from players sold. We could easily raise a further £20m just in the sale of Ospina, Jenkinson, Perez & Campbell.

The reality is, once fully explained, having a pre-sales budget of £50m is actually more than sufficient.

Have a good weekend. Enjoy the Royal Wedding. Up the Harry.


Arsenal Targets: 10 Wingers

Everyone agrees that we need a goal keeper, centre back and defensive midfielder next year. But we also need a winger.

Since letting Theo Walcott leave in January, we do not have a natural wide man. Whilst Danny Welbeck can do a job there, we require a speedy wideman who is happy getting chalk on his boots.

Against Atletico Madrid in the first leg, we struggled to change game plan. Over the two legs, we bought on 1 substitution. I expect next season we will play fairly narrow, with Mesut Ozil and Henrik Mkhitaryan playing in behind a single striker.

This means that we need an option on the bench to change things up, take things wider.

Strikers Welbeck, Alexandre Lacazette and Pierre-Emerick Aubameyang can play out wide, but it is not their natural game and they will only drift back inside. Likewise with Ozil and Mkhitaryan (alongside Alex Iwobi), both would start out wide but end up inside.

This would result in us making a change to go wider, but not having the players who will stay on the touchline. In turn they drop back inside and the in-game tactical change has not occurred.

Manchester City have Raheem Sterling and Leroy Sane who provide excellent foils to Kevin de Bruyne, David Silva and Bernado Silva. Liverpool are also capable of changing things up, even it is using the same personnel.

When they wish to go for width, a simple change of Mo Salah on the left and Sadio Mane on the right completely changes the complexion of the team.

What Arsenal need is a young, intelligent winger. Someone whose natural inclination is to play out wide, but they also versatile enough to play across the front line positions. Someone with natural pace, but technique to match.

So what options are there?

Leon Bailey (Bayer Leverkusen)

The 20-year-old Jamaican has been in sparkling form for the majority of the Bundesliga season and has scored some spectacular goals to help Leverkusen to fourth place and Champions League contention. He ticks every box for Arsenal.

Justin Kluivert (Ajax)

The 19-year-old son of former Holland and Newcastle striker Patrick, young Kluivert is making a name for himself as a winger of note. Already valued in the £40m bracket, the Dutch youngster is perhaps overpriced and Ajax have recently been looking to extend his contract.

A new deal with Ajax would see a huge sell on percentage for both the play and super agent Mino Raiola. This would see him stay in Holland for a couple more years before he is moved on. Arsenal have recently dealt with Raiola in the signing of Henrik Mkhytarian.

Ousmane Dembélé (Barcelona)

The French teenager became the world’s second most expensive player, when he moved to the Camp Nou in a €105m deal, to replace Neymar last summer. However, he suffered a hamstring injury in September, which ruled him out for four months.

He returned in January, but got injured again.

Barcelona are expected to strengthen their forward line with the signing of Atletico Madrid forward, Antoine Griezmann this summer, which could lead to them attempt ro recoup some of their huge outlay on Dembele.

Gelson Martins (Sporting Lisbon)

The 22-year-old is super fast and has been tipped for the top by coach Jorge Jesus. Tottenham, Chelsea and Liverpool have watched the Portugal international extensively and he is a classic-style winger who beats his man and gets the cross over. Arsenal may demand he learns a bit more but certainly has the raw talent and has scored 10 goals.

Malcolm (Bordeaux)

Arsenal were favourites to sign Malcolm in January, but they delayed the deal after the dual signing of Henrik Mkhitaryan and Pierre-Emerick Aubameyang arose.

With Bayern Munich and Borussia Dortmund now interested in him, Arsenal now face more competition for the Brazilian youngster than they did earlier in the year.

Malcolm himself has come out and said he expects to leave Bordeaux, come the summer. The 21-year-old is a quality winger capable of playing on both wings, and also has the technique to move into the middle when required.

the Gunners are  suddenly set to miss out on a real talent.

Christian Pulisic (Borussia Dortmund)

Has two years left on contract and is regarded as one of the most talented teenagers in the world. The USA international can play on the wing or as a playmaker. He joined Dortmund during the time recruitment was overseen by Arsenal’s Sven Mislintat.

Anthony Martial (Manchester United)

Still just 22, it is incredible to think that Manchester United shocked the footballing world by signing the then teenager for £36 million. What seemed like a crazy price in 2015 would now be considered a good deal.

He has fallen out of favour at under Jose Mourinho and could be looking for a way out this summer. Only questions are around whether he would want to move from Manchester United’s bench to Arsenal’s, and whether he is exactly what we need.

He is not a winger who gets chalk on his boots, more a frustrated forward playing out wide.

Riyad Mahrez (Leicester City)

At 27, the Algerian is perhaps not as young as others on this list, but he his Premier League experience and versatility trumps that.

A £50m move to Manchester City fell through in January. He has 2 years remaining on a 4 year deal that he signed back in 2016, and Leicester City might decide this is the last summer that they can get a decent transfer fee for him.

Whilst we should go no where near the £50m that City had agree, if we can get him for closer to £30m a deal should be done.

And a blog about wingers would not be completed without mentioning the names Julian Draxler and Thomas Lemar.