SóProvas


ID
3791776
Banca
FATEC
Órgão
FATEC
Ano
2010
Provas
Disciplina
Inglês
Assuntos

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FOOTBALL'S RED CARD 

THE WORLD'S MOST VALUABLE SPORTS TEAM IS drowning in debt. English football powerhouse Manchester United (Forbes estimates its worth at $1.8 billion) had to raise some $800 million in a bond issue last month, which is still $340 million shy of its total debts. Man U needed the bond to pay off the millions that American businessman 
Malcolm Glazer borrowed to purchase the team in 2005. But in the first three weeks since the bond was issued it lost nearly 10 percent of its value, a sign that, even though Man U's revenues reached a record $444 million last year, the market is growing wary of debt, particularly the European variety
Man U isn't alone. Debt levels have also skyrocketed among rivals like liverpool, calling into question the business model of English Premier League football. Each year the three worst teams are banished to a lower league, where vital broadcasting revenues are dramatically reduced. This puts huge pressure on clubs to compete for the best players, who now regularly fetch more than $50 million a year. Unlike in the U.S., there's no system of collective bargaining to restrain wages. As a result, the total salary bill for the Premier League has risen more than 20 percent since 2008. This has created a vicious cycle of rising debt among clubs that must spend extravagantly on players to ensure increased revenue. Any team attempting to be frugal becomes more likely to end up with lower revenue. It's become a game of who can spend the most, and it probably won't end well. 

(BY WILLIAM UNDERHILL - Newsweek)

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