‘Swallowing a whale’: the net effect of Ronaldo’s return


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Cristiano Ronaldo is set to play for Manchester United on Saturday for the first time in 12 years in a match that will be treated as a joyous homecoming by fans at the Old Trafford stadium.

The Portuguese striker’s transfer came after emotional appeals from United heroes, including former manager Sir Alex Ferguson, for him to reject a move to local rivals Manchester City.

Behind the scenes, however, the club had to ensure the deal made commercial sense, having broken with a strategy of buying players in their prime to make 36-year-old Ronaldo the best-paid footballer in the English Premier League. 

Club insiders have likened the signing to “swallowing a whale” — Ronaldo, considered alongside Lionel Messi the greatest player of his generation, will cost at least £60m, or about 5 per cent of United’s projected revenues over the next two years. 

The money cannot be recouped through shirt sales or sponsorship deals alone, say people close to the club’s leaders.

Instead, executives are banking on more intangible returns. This includes a belief Ronaldo will raise standards within the team, excite fans who protested against the club’s involvement in the ill-fated European Super League project and attract a new generation of supporters worldwide. 

Cristiano Ronaldo poses in a Manchester United shirt after signing for the club in August © Manchester United/Getty Images

The club’s recruitment committee is made up of outgoing executive vice-chair Ed Woodward, football director John Murtough, head of scouting operations Steve Brown and director of football negotiations Matt Judge. Manager Ole Gunnar Solkjaer also has a veto over potential signings. 

A list of targets are decided upon months in advance of the three-month summer transfer window, when most transfers take place.

That was the process with this summer’s signings of Jadon Sancho from Borussia Dortmund and Rafael Varane from Real Madrid. The recruitment team will meet this month to discuss next summer’s targets.

Ronaldo’s signing was much quicker. His agent Jorge Mendes held tentative discussions for weeks with several clubs but only informed United executives the striker was determined to leave Italian club Juventus on August 24. 

Manchester City was already in advanced discussions to sign him having given up on Tottenham Hotspur target Harry Kane. But United moved fast to negotiate an alternative deal to City’s, which was completed by the Friday. 

It offered Juventus a €15m transfer fee amortised over five years, along with up to €8m in performance-related bonuses. A pay package slightly lower than Ronaldo’s net annual €31m at Juventus was agreed, over a two-year contract with an option to extend by another year. 

One person close to Manchester City’s leaders said they had ended talks with Ronaldo over Juventus’s insistence on a transfer fee. “If City really, really wanted to sign him, United wouldn’t have had a sniff,” the person said. “This really ended up as a marriage of convenience. No one else really wanted him.”

But United has demonstrated it is one of the few clubs that could afford Ronaldo at all. With fans returning to stadiums, it aims to return to pre-pandemic annual revenues of more than £600m, making it among the richest in world football.

© Carl Recine/Action Images/Reuters

Most of this income is stable. Old Trafford is sold out every season, through advanced season ticket and hospitality sales. Broadcasting deals are made centrally by the Premier League and Uefa, European football’s governing body.

Ronaldo’s contract, like those of other United players, includes “downside protections” such as wage cuts if the team fails to qualify for the Champions League, Europe’s most prestigious club tournament where €2bn is shared between participating clubs.

Ronaldo did help raise revenues at Juventus, with the Italian club’s annual sponsorship income rising from €143m to €175m during his three-year stint, according to consultancy KPMG. 

The same effect is not immediately expected at United, whose commercial income was £279m in 2020. The club has already secured its biggest endorsement deals, such as a five-year shirt sponsorship worth €275m with German technology company TeamViewer announced in March.

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The vast majority of revenues from replica shirt sales is taken by the manufacturer, Adidas, although the club does make a higher margin on sales through its official website run by Fanatics, a US-based online retailer.

“When Juventus bought Ronaldo, they were starting from a significantly lower base of commercial revenues,” said Andrea Sartori, global head of sports at KPMG. “United is much further ahead, so the marginal benefit is not as high.”

The striker does help the club’s business, though. United has cited its social media reach in defending the value of its commercial deals during the pandemic, and Ronaldo has the world’s biggest Instagram following at 340m.

His stardust may also attract new attention to a club that has not won the Premier League or Champions League, the two biggest competitions it competes in, since 2013. 

While it is hoped Ronaldo can push United back into contention for those prizes, club executives believe he will also draw in younger and international audiences, which could benefit the club for years to come.

“From a commercial standpoint, Manchester United acquiring Ronaldo is like putting the best fuel into the fastest car, but that’s not why we did it,” said one person with direct knowledge of the deal, adding: “Ronaldo’s quality, leadership and experience will help the younger squad members and give us a shot in the arm on the pitch.”



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