FSG may need to open wallet for long-term Liverpool plan but transfer truth is complicated

Dave Powell assesses the situation after many Liverpool fans have called on owners FSG to provide funds for a new midfielder


Prior to the game much had been made about the crisis that continues to envelop Manchester United. Protests against ownership took place with a planned march ahead of the clash with Liverpool, although the appetite for a mooted walkout to show solidarity against the Glazer family never manifested.


The anger from the 4-0 demolition that Erik ten Hag’s men had suffered at the hands of Brentford last week had cooled somewhat over the following days, the club’s continuing involvement in the transfer window and eventual acquisition of Real Madrid midfielder Casemiro in a £60m deal taking some of the edge off what had been planned.


Pundits were predicting a cricket score for Liverpool, who had made a slow start to the new season, but as Manchester United applied the pressure from the off on the Reds anyone holding those hopeful views saw them quickly evaporate, just like the walkout plans that some had been trying to drum up support for online during the week.


After the final whistle sounded on a chastening evening for Liverpool at Old Trafford it was many Reds fans who were asking questions, issuing a clarion call to owners Fenway Sports Group to address their midfield issues in the transfer market before it was too late, the makeshift trio of James Milner, Jordan Henderson and Harvey Elliott not a viable solution for the Reds in the centre of the pitch if their injury issues persist.

Familiar calls arrived, with FSG’s perceived lack of transfer spend and penchant for keeping their net spend low a focus. The defeat, the deficiencies that existed in midfield prior to the game due to injuries and the fact that United were parading around a new acquisition all added to the melting pot.


Following Liverpool’s defeat at Old Trafford, football finance expert Swiss Ramble compared and contrasted the financial performance of the two clubs over the past decade.


Over the last 10 years the net spend at Manchester United on transfer stands at £1.4bn compared to Liverpool’s £1bn, and only three times have Liverpool spent more than Manchester United on players in a season over the same period.


Where there has been a rise is the wages that have been paid out, with United paying 50 per cent more than the Reds in 2014 on wages (£215m to £144m). But since then that gap has closed significantly as Liverpool have committed more and more to payroll, the gap down to just £9m in 2021’s accounts with Liverpool’s wage bill at £314m. The previous season they had paid out more than United on wages for the first time due to bonus payments paid to players for winning the Champions League.


Revenues have been closed significantly over the past decade, something that has allowed for the extra spend. A gap of £217m existed between the two when it came to revenues as recently as 2017, something that has been closed to just £7m (Liverpool achieving £487m in revenue in 2020/21) due to the greater success that the Reds have had in raising commercial deal value and increased broadcasting money, more than United.


Liverpool are a financially well run club, one of the best of the elite group in European football. The problem that they have in terms of their success in recent years is that they are now competing with Manchester City and not Manchester United for the top honours. The closing of the gap on United is one thing that was seen as key early in the FSG reign, but with City now the dominant force domestically and others willing to spend, such as Chelsea, to try and make sure they stay the pace it has seen the more holistic approach to running a football club by FSG challenged year after year.


With Mohamed Salah signing a new deal in the summer and the Reds landing their number one target in Darwin Nunez, there was the feeling that FSG had managed to create some goodwill on the playing side of things and that the plans to head into the market again before it closes at the end of the month would be avoided, although the issue over a midfield that needed another key addition remained. But the slow start, injuries, Wolverhampton Wanderers’ move for reported target Matheus Nunes and the spend of other clubs such as crisis club Manchester United on Casemiro and even Nottingham Forest’s open wallet policy has meant that the focus is back once more on an ownership group – who are feeling similar heat over their recruitment policy and perceived lack of investment at both Liverpool and a struggling Boston Red Sox baseball team.

There are few topics as divisive as ownership on football Twitter when it comes to Liverpool. To see operations from an FSG perspective and to accept the model is seen as enabling a lack of investment at key times that will ultimately hold the club back in the future and hamper their prospects of winning the biggest prizes, while to want the owners to freely spend or even sell up to whoever will spend the most in the market is seen as reckless in some quarters and ignoring the issues that come along with that, such as the Glazer chaos at Manchester United and the arguments over sports-washing at both Manchester City and, more recently, Newcastle United.

There isn’t really a right answer. Most football fans traditionally support their clubs because it is their identity, and winning trophies and seeing your team be successful is what much of it is all about. Having a sustainable business that underpins success is something most people would want alongside that, but when rivals are spending more and seemingly caring a little less about the bottom line there is an understandable level of anger that Liverpool have been perceived to not do the same. Fans want the best players and success, they want to be top of the Premier League table and not the net spend table.


But there are crucial differences that exist alongside this. Moving forward it is likely that the era of the open wallet, unless it comes from regimes with a reputation to launder, will pivot towards clubs being stronger financially, where they will turn themselves into thriving businesses that sees their value grow. Todd Boehly and Clearlake Capital didn’t acquire Chelsea to drain their wallets, and while they have spent considerably since taking over the club from Roman Abramovich there is very much a plan to turn the £2bn-plus purchase fee into a business valued at far more in the future.

US private equity has flooded in to European football in recent years. It has a scarcity value, it is seen as having under-developed revenue streams and it has media rights that have still yet to peak, many believe. But where there is private equity there is a requirement for the business to be successful, and net spend and a focus on streamlining player trading is something that there will be more of moving forward.

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