Why are Arsenal overpaying for Lucas Torreira?

The last time we were in for a Uruguayan, we offered £1 above his release clause.

That time, Liverpool stood their ground and basically said to Luis Suarez “take us to court for breach of contract”. Suárez didn’t. Signed a new deal, joined Barcelona a year later and Arsenal were made to look very stupid.

What those in the press ignored, however, was that this is who release clauses work. You must bid above that release clause to activate it.

Arsenal did exactly what every other club does when activating a release clause and bid a minuscule amount above it. Enough to activate it.

Liverpool made the deal public – in the hope of shaming Arsenal into paying more. Arsenal moved on to Yaya Sanogo and the rest is history.

Instead of bashing Arsenal for doing everything correct and legal, the press should have actually questioned Liverpool’s actions. Their breach of contract. But we know the press will never upset Liverpool fans.

Role on 5 years and Arsenal have reportedly agreed a £26.5m deal for Sampdoria’s Lucas Torreira. Yet Torriera’s release clause is just £22m.

So why are Arsenal overpaying for the defensive midfielder? The reasoning is simple.

The release clause is a single upfront payment. Torreira can leave for £22m if Arsenal pay 100% straight away.

Arsenal do not want to do that. They want to pay in instalments, to help out with cash flow when things might be a little tight due to two years without Champions League football.

As soon as you pay in instalments, the release clause is not activated, so you have to negotiate like any other transfer.

Eventually both clubs agreed on a deal that will see Arsenal pay £4.5m above the release clause, with the fee spread over a few years.

Arsenal free up cash for more transfers this summer, Sampdoria can still spend the full fee knowing that they have the guaranteed cash coming in over the next few years to cover the amortisation of whoever comes in.

It is a bit like buying a car.

You go and get yourself a new white Audi A1 (you are a hair dresser). It is £22,000. But you do not want to pay upfront. You want to spread your payments over 4 years. Finance deal.

Instead of the car costing you £22,000 in one hit, it is now going to cost £6,500 a year – totalling £26,000 over the 4 years.

You could have got the car for cheaper, but you wanted the finance deal to ease up your personal cash flow; so you have had to pay an extra 20% for the privilege.

The deal for Torreira is similar. A finance deal. Some money now. Some more over the next few years.

Sampdoria benefit by getting 20% more than his release clause. Arsenal benefit by not having to spend as much upfront.

Good deal all round

Keenos

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