Tottenham Hotspur and Manchester United will duel it out at the Estadio de San Mames in Bilbao, Spain, this evening in a high stakes game that will have an impact on the coming seasons for both clubs.
Ange Postecoglou’s side have, like their opponents tonight, endured a thoroughly miserable domestic campaign, with both still potentially finishing the season one spot above the relegation zone in the Premier League. For two clubs that form part of the so-called ‘big six’ that is a woeful underachievement.
There have been arguments made in recent weeks, including from former Arsenal manager Arsene Wenger, that the winner of the Europa League should not be afforded qualification into the league phase of next season’s Champions League. But the rules are the rules and tonight’s Europa League final offers both clubs the opportunity to qualify for European football’s elite club knockout competition despite faltering badly domestically.
Both clubs need the financial hit that Champions League qualification brings, too. For Spurs, who don’t have issues around profit and sustainability rules (PSR), it is around improving the balance sheet and providing funds to improve cash flow ahead of a summer that could see them have to sell to buy due to the heavy transfer debt and limited receivables that are due to arrive.
Much of Spurs’ transfer debt has been on credit in recent years, and as of the 2023/24 accounts, published last month, the transfer payables, which is the money the club owes to other clubs still for transfer fees, stood at £337m, an increase of around £250m from the £88m it stood at back in 2019, the year they moved into their new Tottenham Hotspur Stadium home. Sitting behind only Chelsea’s £479m, Spurs’ transfer debt is the second largest in the Premier League.
In terms of what is coming the other way, Spurs are owed £58m in transfer receivables from clubs, meaning that there is a £279m difference between the two, and that is not insignificant.
Given the way that PSR looks at allowable losses of £105m with permitted deductions for investment into infrastructure, the women’s team, the academy and community initiatives, Spurs’ heavy debt, much of it attributable to the new stadium, means that they are still in a good PSR spot, especially given their significant commercial and matchday revenue, and the low wages to revenue ratio that they have.
But cash in the bank as of March 31, 2024, stood at £79m, down from £198m the previous financial year. Spurs have been eating into the cash reserve in the past 18 months, and with the potential of another lean year if they miss out on the Champions League through failure to win the Europa League, that could have to continue.
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For Manchester United, they are close to the PSR threshold and missing out on the Champions League this summer would also see them have to suffer some pull back from commercial partners in terms of what deals are worth, with the likes of kit supplier Adidas having a clause in their deal with the club that sees the annual sum due fall by £10m for failure to qualify for the Champions League. With United needing a rebuild, a significant one at that, having additional funds would accelerate that process.
For Spurs, winning the Europa League final this evening would be worth £125m more than what it would be worth for Manchester United.
Europa League success, through participation fees, prize money and the value pillar that dishes out funds based on league market size and coefficients, is worth £35.4m to Spurs and £35.6m to Manchester United. Taking into account matchday revenue for the home games played in the competition, average ticket income per home game of £4.3m for Manchester United and £4.9m for Spurs, as per City AM, provides additional revenue of £30.1m and £34.3m respectively.
That brings the total prize pot for Europa League success to £69.7m for Spurs and £65.7m for Manchester United. Another benefit of Spurs’ move to a new stadium back in 2019.
Qualification for the Champions League yields enormous success. With participation alone worth £15.6m and every victory and draw in the revamped competition’s league phase delivering an additional £1.7m and £580,000, just making it to the league phase can bring in, conservatively, around £20m, and that is before factoring in any progression to the knockout stages, where the money continues on a steep incline. The Champions League value pillar is more lucrative than that of the Europa League and is worth another £20m to clubs.
Matchday revenue then plays another significant role. Playing in the league phase guarantees four home games for each team, adding an extra £17.2m and £19.6m, respectively, to Manchester United’s and Spurs’ finances, bringing the total for both Europa League success and a conservative estimate at performance in next season’s Champions League to £124.9m for Spurs and £118.5m for Manchester United.
The additional funds for Champions League qualification could reach higher figures, as much as £120m, for a deep run in the competition. But whoever triumphs this evening will receive money that will be transformational and allow for a rebuilding process to accelerate and be delivered ahead of time, with both clubs in need of making significant changes to improve on what has been a disastrous domestic campaign that has been saved by a run in European football’s second tier knockout club competition.