Tag Archives: Osumane Dembele

How can Arsenal afford Osumane Dembele?

I am going to bring up that word again that I obsessed over recently. The word that got Big Dave Ornstein liking my previous blog before using what I wrote in a BBC interview. That word, of course, is amortisation.

Now why am I bringing it up in a blog about Osumane Dembele? Because it is relevant, that’s why.

In yesterday’s blog, I mentioned that Arsenal should target the Frenchman. Many responses were that we “can not afford him”. Yet we can. Easily.

Dembele joined Barcelona in the summer of 2017 for €105 million. He signed on a 5 year contract.

A year later, after a tough start to his career in Spain, they are reportedly looking to cut their losses and recoup as much of the transfer fee as they can. And a loan deal with an option to buy seems the way forward.

Big money loan deals with options to buy are not regular in England. Yet in Spain, Germany, France and Italy they are becoming big business. It allows a buying club to get a player on loan for a year or two without needing a big lump of cash to do it. If he works out, they can secure him permanently. If he doesn’t, well they just send him back to where they came from. This sort of deal was seen last year when James Rodriguez went to Bayern Munich from Real Madrid.

The advantage for the selling (or loaning) teams is that they get a player off their wage bill for a couple of years, get a chunk of cash before the loan deal, and a potential for another lump after.

So take Dembele. He originally cost Barcelona €105 million. But he has already been there a year, so his book value, or what Barcelona have left to declare in their accounts, is €84 million. Were Barcelona to accept this for him, they would be able to dispose of what they still have left to amortise and break even within their yearly accounts.

Now let’s say Arsenal do a deal with Barcelona to take the Frenchman on loan for 2 years. Say the deal was at €21 million loan fee. That would split the amortisation of his transfer fee in half.

In simple terms, Arsenal would be covering 1 year of his amortised transfer fee, Barcelona the other. The majority of Barcelona’s “portion” would be offset by the wages they save over the two years.

So fast forward to 2020. Dembele has had a brilliant two years at Arsenal, and we plan to make the deal permanent. The deal was in place 2 years previous. What will that deal be for?

Well at this stage, Barcelona only have €42 million on their books left to pay for Dembele. Could this be how low the agreed fee could be?

It would enable Barcelona to dispose of his transfer fee in the 2020 accounts and be free of him, breaking even on the accounts. Ensuring that they do not need to put additional funds not already set aside to offset a loss.

Arsenal would than be able to start the process again. Give Dembele a 5 year deal, amortising the €42 million over that period. €8.4 million a year.

Could Arsenal really sign Dembele on a 2 years deal for €21 million with an option to buy for €42 million? Yes.

“But where does he fit in” you cry.

Well we could return to playing 4231. Mkhitaryan on one side of Ozil, Dembele the other. But I still think we will play 4321 next season.

This will leave Mkhitaryan, Ozil, Dembele and Iwobi competing for the two behind Aubameyang.

We often moan we lack squad depth, I bet if it happened people would moan we can’t fit them all in.

Remember last season Ozil only started 24 league games. In all competitions he started 33 of the 59 games. That is 26 games he did not play.

Mkhitaryan is also a little bit fragile. He certainly will not start every game next year.

If we play ~60 games again next year, it would not be a major surprise to see Ozil start 35, Mkhitaryan start 35 and Dembele to start 35. Iwobi to start the remaining 16.

This is all just pie in the sky, and Barcelona have recently ruled the deal out. But stranger things have happened in football.