Newcastle generates $46 million by creating and selling new share

Newcastle ownership has made an extra $46 million by selling a single share of the club. The transaction was completed after team executives created an entirely new share. Official paperwork, published by Companies House on April 10, shows that the deal was completed back on March 28.

The recent move, however, was not the only time this season that Newcastle’s owners created a share to sell. Club brass previously made nearly $75 million by selling multiple shares in August. This came just after the new 2023/24 financial year and the current season for the team began.

Newcastle could eventually use the extra money in various ways. The Magpies may opt to spend the funds on rising operating costs at St James’ Park and their other facilities. Or, it could use the influx of cash during the upcoming summer transfer window. Newcastle’s current precarious financial situation, however, will likely play a major part in its plans.

Newcastle is dangerously close to violating spending laws

The Magpies recently announced a post-tax loss of about $93 million for the 2022/23 financial year. This comes after the northeast side revealed similar losses of around $88 million for the previous campaign. Current Premier League profit and sustainability rules (PSR) state that English top-flight teams cannot exceed $134 million in losses over three years.

As a result of these monetary reports, Newcastle is seemingly on the brink of breaching the division’s PSR. Nevertheless, clubs can help their financial issues in various ways. Laws in place also state that money can be removed from the team’s official loss reports by investing in their academy, women’s team, and charity foundations. The Magpies will certainly take advantage of this stipulation.

These slick moves, however, may not be quite enough to help out Newcastle. The club’s CEO, Darren Eales, recently admitted that the team may likely have to sell a star player or two to adhere to PSR. Joelinton was thought to potentially be one of these key players. The Brazilian has since agreed to a new long-term contract at the club. The midfielder doubled his wages in the process as well.

Club wants to keep stars, while also spending more money this summer

The timing of the Joelinton contract extension and selling of the new share is particularly interesting. News of the two deals came within a few days of each other. It remains unclear if the club will continue creating shares to sell to keep its star players together.

Bruno Guimarães and Alexander Isak, arguably Newcastle’s top two players, have both been linked with potential summer moves away from the club. Finding creative ways to generate extra funds, however, may help keep the dynamic duo in the team.

The Magpies, despite spending freely in recent years, find themselves sitting a disappointing eighth in the Premier League table. This comes after the club has recorded a collective net spend of about $435 million since the start of the 2021/22 campaign. Nevertheless, team brass will likely want to free up some extra funds to continue spending during the summer market.

Photos: Imago