Newspapers in Spain are reporting that Spanish champion Real Madrid has been forced to take out a loan of $49 million to cover day-to-day losses which were partly incurred due to the loss of David Beckham to the Los Angeles Galaxy last year. According to a study by the University of Catalonia, the England international’s transfer cost the club between $57 and $74 million, leaving “a considerable hole in their finances.” The same reports claim that Real’s directors have been asked to raise more money because the amount provided in the bank might not be enough to cover the revenue loss.
Real is reported to have contacted La Caixa, Spain’s third largest bank, for the loan. It would be the first loan sought by the club since the presidencies of Ramon Mendoza and Lorenzo Sanz (1985-2000).
In February, financial services firm Deloitte released a study proclaiming Real Madrid as the richest club in the world, with revenues of $576 million based on revenues from ticket and concession sales, television deals and marketing. However, club president Ramon Calderon has spent millions bringing in new players since his appointment in 2006. The club also lost Beckham in 2007 and had to buy out the lucrative contract of former coach Fabio Capello, who had reportedly been the highest paid coach in club history. When you add up the club’s other expenses, the so-called richest club in the world may actually be bleeding money.