City facing Euro ban if they don't break even
Cook angry that Sheikh's spending is frowned upon – unlike the debt of rivals
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Your support makes all the difference.The Manchester City chief executive Garry Cook has said the club cannot put a date on when they will begin to break even, despite the Uefa president Michel Platini's proposal that clubs who fail to balance their books within three years will be barred from European competition.
City's wage bill has more than doubled to an estimated £90m since Sheikh Mansour bin Zayed al Nahyan took ownership 14 months ago. And the unpredictability of future wage demands makes it impossible to predict when the club will, as Platini desires, be spending only what they earn from their television income, ticket receipts and commercial activities. The European Club Association backs Platini's proposals that clubs who fail to do so will be excluded from Europe.
"You can't predict the wage base," Cook said. "From a business standpoint it's not the smartest thing to start to predict long-term financial profit and loss statements. That's not lack of discipline or naivety – that's the reality of a business model which is a moving target. It's foolish to put a line in the sand and predict dates by which you break even."
Though no transfer window will be quite like the summer's in which City spent £120m, their Abu Dhabi owners proved then that they will react to changing conditions in the transfer market. That they spent so voraciously was, in part, a response to their discovery that the economic downturn had made it a buyer's market.
City are aware that as Chelsea have less ambition to buy, and that Liverpool and Manchester United have high levels of debt, they are able to consider themselves the main players in the Premier League market.
Cook's chairman, Khaldoon al Mubarek, argues that Platini's proposals would curb the freedom of owners to buy and invest in "mid-tier" clubs and deliver a monopoly on European success to what are already the richest clubs. City, Cook indicated, will lobby through the Premier League against any plans which create a disincentive to prospective foreign investors. "We should always allow investment in the Premier League. It's the greatest league in the world – a truly global entity – and we should always allow that investment, as long as everybody manages the integrity and the Premier League puts governance in place to control who [invests] and how."
There is indignation at City that the levels of investment by Sheikh Mansour are being frowned upon in a way that debt-leveraged clubs are not – even though the Sheikh's capital investment at every level of the club has gone some way to quell initial suspicions that he was simply out for rapid glory.
Evidence of the investment was everywhere among the 83-strong City contingent in Abu Dhabi last week. In Cook's company at the Emirates Palace hotel, for instance, was one of the specialists brought in by the Arabs to ensure City's training pitches include four levels of grass to allow them to prepare for the exact conditions of various Premier League games.
While Liverpool's £30m Champions' League income is vital to cover their American owners' annual debt repayments, Cook said City will be able to budget for seasons in which they do not make it to the tournament.
Not qualifying, Cook said, has "a financial impact on your overall performance as an entity, a business, and you have to adapt and react to that. But what I don't want anybody to think is that we don't worry whether we are in it or not because we don't need the money. I'm building a financial plan that includes playing in the Champions' League. I also have a scenario B, in the event we don't make it – because that's good business".
The longer City take to break through to the top four, the longer they will need to provide extra wage incentives to entice players to the club and Cook believes that Britain's new 50 per cent higher tax rate – seven per cent higher than Spain's equivalent – will make the task of bringing in players tougher. "It is going to be challenging getting players in because there's [additional] financial demands on a club to bring those players in. But there is that emotional effect of the game which says the Premier League is one of the best leagues to play in."
City have no intentions of allowing Robinho to leave for Barcelona, though there is a view within the club that the Catalans have been unsettling their £160,000-a-week Brazilian. Mark Hughes sees the player as an important component of an assault on a top-four place this year, an attainment Cook believes is within City's reach. "When do I want to be in the Champions' League and when is it feasible?" he said. "I want us to be in the Champions' League next season, I want us to be playing Champions' League football every season."
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