Football: Are Club Takeovers Driving the Inflation of Player Prices?

PSG, Newcastle, Chelsea, Atlético Madrid, just to name a few. Many big football clubs have changed ownership in recent years. But are these takeovers really behind the skyrocketing prices of players? It’s an easy assumption to make, yet a closer look at these clubs’ strategies tells a different story.

“Obscene”, “outrageous”, “unjustified”: these are just some of the adjectives used to describe the sums of money involved in transferring football players between clubs. Since the liberalisation of the transfer market, the football ecosystem has attracted substantial investment. A total of 9 billion euros’ worth of transactions was recorded for the 2022/23 season alone.

According to the CIES Football Observatory Monthly Report, inflation in transfer prices has been at 116% over the past ten years. Over the same period, another phenomenon has had a major impact on the world of football: many major clubs have been taken over by state-owned investment firms or pension funds.

A mere glance at the list of most expensive transfers to date is enough to see a link. At the top, two names (Neymar and Mbappé) and two sums (222 and 180 million) appear, but only one club: Paris Saint-Germain, bought in 2011 by the State of Qatar.

Price inflation

When new owners come in, we tend to think that the market reacts by hiking up transfer prices. We talk about “post-acquisition premiums”, a phenomenon occurring when these acquisitions are seen as a signal of financial power. Recently bought clubs find themselves in a position where they must show their ambition by buying competitive and/or renowned players, inciting players’ agents and the selling clubs to demand higher prices for each transaction.

This phenomenon is often fuelled by the new investors’ desire to quickly leave their mark on the club and to meet supporters’ expectations. In this frenzied race, the takeovers create an inflationary spiral which sometimes extends across the entire transfer market, redefining the price standards over several years, even decades.

However, not all acquisitions create these effects. While some clubs are pressured to show financial exuberance, other owners choose not to yield to these dynamics. This mostly happens when the background of the takeover is affected by financial or regulatory constraints, forcing the owners to invest more carefully. In these cases, instead of buying expensive players, the clubs will favour a more methodical management of their squad, by focusing on emerging talents or less costly solutions. The impact of a takeover thus varies significantly depending on the investor’s profile and strategic objectives.

Agressive spendings

A certain number of clubs take a resolutely aggressive approach following an acquisition, seeking to demonstrate their new financial status through spectacular purchases. Let’s take the example of Chelsea, bought in 2022 by a consortium led by Todd Boehly. As of the first transfer windows, the club made massive expenses to recruit top-class players, regularly paying well over their real value to secure the most sought-after talents.

However, this strategy comes with a significant sporting risk. Destabilising the team by integrating the new players too quickly, or creating unbearable pressure to deliver immediate results. By taking this approach, Chelsea not only changed its recruitment policy but also, as have other clubs, redefined price expectations across the English market. Transfer market investments have increased by an average of 7% every year between 2015 and 2024.

Another club in the Premier League—the English division that some call the “NBA of football”—was taken over in the same period. The legendary club, Newcastle United, came under Saudi ownership in 2021. The Riyadh sovereign wealth fund has implemented a more gradual strategy. The club has made expensive purchases, yet via a more targeted approach that aims to build a well-balanced team over the long term.

Unlike Chelsea, Newcastle did not immediately seek to recruit massively, preferring to gradually reinforce each position on the pitch. Not all ambitious takeovers necessarily mean uncontrolled outbidding; they can sometimes align with a more coherent sporting vision, even with significant financial resources.

Patience is the highest good

In contrast to ambitious takeovers, some clubs that have been bought out prefer to espouse a more prudent strategy. A notable example is Lille’s team, LOSC, which was taken over when it was heavily indebted. Rather than embarking on a series of costly purchases, the new owners chose a transfer policy focused on low-cost acquisitions, favouring promising players or those with less market value.

This approach has allowed the club to retain a certain level of competitiveness (its strategy did not shift towards merely avoiding relegation, but continued aiming for qualification spots in European competitions) while remaining financially sound. By investing in young talents and adopting a player-trading strategy—seeking to significantly increase the value of players— Lille managed to stabilise while avoiding inflated prices. This cautious management shows that even under pressure, it is possible to rebuild without overspending.

La Liga bets on youth

In Spain, clubs like Atlético Madrid and Grenada have also implemented different strategies after their takeovers. Bound by the strict regulations of La Liga—the Spanish championship—concerning salary caps, these clubs have had to find ways of strengthening their team, while respecting the imposed budgetary limits.

For example, Atlético Madrid has heavily focused on training young players and seeking out low-cost talents, gradually integrating new additions into the first team. This strategy not only answers regulatory constraints, but also a willingness to build a lasting long-term project. Similarly, Grenada, followed a comparable approach, relying on younger players and local solutions to reinforce their squad without incurring enormous costs.

Takeovers and identity

The analysis of different takeover strategies highlights a key phenomenon: post-acquisition premiums are not universal, but contextual. Clubs operating in highly regulated environments, such as La Liga, take a more cautious approach, to avoid sanctions. Conversely, in more permissive leagues, like the Premier League—where access to capital is easier—takeovers often trigger a wave of inflationary spending.

For new investors, the challenge goes beyond simply injecting capital. It lies in building a coherent and sustainable project that aligns with the clubs’s history and aspirations. A successful takeover is not just about multiplying high-profile transfers. It is about finding harmony between economic ambition and sporting integrity. The club’s capacity to reconcile these different dimensions, while preserving its identity, will determine whether this kind of investment will lead to genuine renewal or failure hidden beneath extravagant spending.