Are Arsenal Splashing the Cash at Last?

As we await the imminent announcement of Santiago Cazorla from Malaga, there has been a lot of discussion on whether we are now looking at a change in transfer policy from Arsene Wenger.

On July 4^th, the media smelled blood with van Persie’s statement that he will not be signing a new contract at Arsenal. Yet, many were forced to stop short of making widespread accusation towards Wenger as by this point (4 days into the transfer window) he had already secured the signings of Ligue 1 top scorer Olivier Giroud and one of Bundesliga’s top goal-scorers Lukas Podolski.

During the course of the past 7 years, there has been lots of accusation at the over-reliance of youth and shopping in the bargain basement. So what is different this year? Has Wenger’s philosophy changed from investing in youth? Or perhaps there is more cash available at the club?

Back in early June in a supporters trust meeting, Ivan Gazidis, the Arsenal Chief Executive, repeatedly stressed the importance of the self-sustainable model of the club. Alarm bells were ringing as fans have been concerned in the manner in which the club are heavily relying on UEFA to enforce financial fair play. It is no secret that the club are not likely to have substantial funds to compete financially with Europe’s big teams until atleast 2014 when the current sponsorship with Emirates expires.

So the question begs that with the handicap of having not as much resources as our rivals, why is the club on this current spending spree? There needs to be perspective when casting eye on Arsenal’s recent transfer dealings. Can the acquisition of Podolski, Giroud and Cazorla be classed as “splashing the cash”?

Arsenal have acted very early in the transfer market, conducting business in a lot of secrecy from the prying eyes of the North East. The most effective of all weapons that the club possess is the Champions League football next year. Players want the opportunity to compete among the best and the club can offer that next season.

The backroom staff have been hard at work over the course of the year. Gazidis and his team look to have stepped up their operations significantly to make sure Arsenal can sign some top quality players without being outdone by the rich boys. Credit not only has to be given to the scouting network, but also those that conducted research and identified available opportunities for the club to exploit.

German Efficiency

First there was the signing of Lukas Podolski from German club FC Koln. The 26 year old striker had a torrid time when he played for German outfit Bayern Munchen a few years ago. The idea that he doesn’t have the mentality to play in a big club has stuck among many around Europe. However, by his own admission, the move for to Munchen came too early in his career. Some players hit the ground running when they are young while others take time to mature and Podolski has found himself in the latter category. He doesn’t shy away from admitting his attitude was not acceptable during his time at the Allianz Arena but he has worked to put things right and became one of Bundesliga’s most prolific strikers.

The fee paid for Podolski was in the region of £10m and his wages are believed to be in the region of £90k a week. In comparison to the going rate of a player with over 100 appearances for the German national team, it is a good piece of business by Arsenal.

Same old Arsenal

Then there was the capture of Olivier Giroud from last season’s surprise package Montpellier. Giroud’s signing was shrewd business by the Gunners who capitalised on the €12m (~£9.6m) release clause of the Ligue 1 Golden boot winner. It is widely known that club’s around Europe have nightmares about Arsenal calling in for their players. It is a due to the club bidding bare minimum prices leaving the selling club being in a situation whereby they are forced to sell as the player in question has their head turned.

Montpellier’s president Louis Nicollin openly admitted his frustration at the low release clause on the player’s contract. Despite interest from clubs across Europe, Giroud favoured a move to the red half of North London and Montpellier were forced to sell at the release clause rate at what became Wenger’s second signing before the transfer window opened.

Struck Oil!

Finally came the long awaited signing of Santiago Cazorla from debt stricken Spanish outfit Malaga. The deal has been equally if not even more ruthless business by the club. Countless media and clubs across Europe have been left surprised at the manner in which Arsenal not only capitalised on Malaga’s dismal financial situation but also at the speed in which the club closed the deal out.

The Cazorla signing is one that that very few could have predicted. On the surface of it, this is a Spanish European cup winner with over 40 appearances for a national side that boast players in the calibre of Iniesta, Xavi and Fabregas. Furthermore, Cazorla only moved to Malaga a year ago. As difficult it is to prise away a player in those circumstances, Malaga were looking in excellent shape, securing a Champions League Qualification spot in next year’s competition.  With that in mind, many clubs would consider it a waste of time and resources to make any enquiry on the player let alone submit a formal bid.

As I mentioned earlier, Arsenal look to have done a lot of research over the course of the year so Malaga’s financial reality would not have been new information. The club secured negotiations and a deal for Cazorla before Malaga’s financial state became apparent, while holding off late attempts from Chelsea to hijack the deal.

Despite several figures being thrown around, the fee is believed to be in the region of £11m plus £4m add ons. It’s a great price for a player like Cazorla and a low fee due to Malaga’s request to pay the money up front immediately so they can relieve some debt. It is not the norm to pay up whole transfer fees straight away and usually requires a series of instalments. Arsenal had the advantage of being able to pay money up front and in turn driving the transfer value down.

Splashing the Cash?

So with Podolski at ~£10m, Giroud at ~£9.6m, and Cazorla at ~£15m, Wenger has taken his summer spending to around £35m. Now if you consider that Chelsea paid out £36m for Eden Hazard is this what we can call “splashing the cash” or efficiency in the market?

Whereas Manchester City, Manchester United and Chelsea can spend £35m on one player, Arsenal must get by spending that amount over 3 or 4 players in total. Wenger’s budget every year has been known to be around the £40m although there has been massive debate in how much of that money has been made available to the manager due poor commercial income.

Yet, the whole situation is not so simplistic. The club must still sell before closing all transfer dealings for the summer and adhere to a 1-in-1-out policy. Whether van Persie, Bendtner, Squillaci or all of them are shown the exit door, it’s a continuous battle to balance the books in North London. One of the most high profile casualty of such a policy was Juan Mata last year. While the fee and terms were agreed with the player, the club could not close out the deal until Fabregas’ move to Barcelona was finalised and wages were freed. This allowed Chelsea to capitalise on the delay and Arsenal lost out on an excellent player.

Arsenal look to have made no such mistakes this time. While Wenger confirmed last week that Bendtner, Park and Squilacci will be leaving, the club have taken no chances in securing the signing of Cazorla.

Though attention must now turn towards improving the defence, Arsenal look like a club heading in the right direction. Now an exciting Premier League season beckons for the Gunners.