Arsenal midfielder Fabio Vieira is likely to leave the club this summer in an exit that would bring an end to his spell in North London.
The Portuguese ace was signed as an option for the future, offering the potential to bring his playmaking talents to the Emirates Stadium.
However, it hasn’t quite worked out for him at Arsenal, with a loan exit back to Porto going through in the past year.
With Fabio Vieira set to return to Arsenal this summer, with just two years left on his contract, there is a transfer exit lined up.
Many expect the Gunners to make a loss on the midfielder, but that may not actually be the case.
Amortisation rules mean Arsenal could bank a small profit on Fabio Vieira transfer exit
Arsenal paid £34 million to sign Fabio Vieira from Porto in 2022, signing a five-year deal with the Gunners at the time.
While many think that Andrea Berta will need to land £34 million back in transfer fees to break even on the midfielder, that isn’t the case for their accounting.
This is due to a rule called amortisation, which is how a player’s value depreciates across the length of their contract, until the fee is worth nothing at the end of the contract.
Finance expert Adam Williams explained more on the situation, stating: “Transfer fees are both a cash and a non-cash cost, and the non-cash element of that is what’s known as amortisation.
“I don’t know how the Vieira deal was structured in terms of an up-front fee versus instalments, but let’s assume for the sake of argument that they paid £14 million up front and then two annual instalments of £10 million thereafter. So for the next two years, you have to find that cash, but that doesn’t affect your profit-and-loss result.
“Instead, it’s a player’s amortisation charge that affects your profit or loss, which is why amortisation is key to deducing a club’s PSR position.
“What is amortisation? It’s the process of registering a player’s transfer fee over the course of his contract, up to a limit of five years, under the Premier League’s PSR system. This is a non-cash expense, remember. It’s a separate process from paying in instalments, even though it sounds similar.
“You make this calculation to work out the player’s book value, and it’s his book value which dictates the profit or loss on a sale.
“Vieira signed a five-year deal in 2022, so his book value is roughly £13.6 million as it stands, i.e., £34 million divided by five equals £6.8 million, multiplied by three equals £20.4 million, then you subtract £20.4 million from £34 million to give you £13.6 million.
| Transfer fee | £34m |
| Depreciation per year | £6.8m |
| Cost amortised so far | £20.4m |
| Cost remaining on contract | £13.6m |
“That means that, for accounting and PSR purposes, any sale price above £13.6 million would hit the books as a profit. Conversely, if they sell him for any less than £13.6 million, they make a loss on the sale.”
It shows exactly what Berta must do to land an accounting profit on Vieira when it comes to possible transfer talks.
How much is Fabio Vieira worth in the transfer market?
It’s unclear which clubs will show interest in Fabio Vieira, following his loan spell at Porto in the past year.
The Portuguese club failed to make the Champions League, making it tough to see if they could afford to land another return for him on a permanent deal.
If clubs were to make an approach, then anything over the £13 million mark would be seen as a profit.
Transfermarkt claims that Vieira is worth €22 million (£18.8 million), which would be a good fee for Arsenal to pick up.
Whether clubs are willing to make that move, though, is unclear.
from Arsenal FC Transfer News, Rumours, Loan Deals & Signings | Arsenal Insider
Luke Thrower