Atlético-MG negotiates debts and will have firepower with mall sale

After a negotiation that lasted about two months, Atlético-MG announced the sale of another 49.9% of Diamond Mall, a mall located in the Center-South region of Belo Horizonte and which belonged to the Minas Gerais club. Galo will receive R$ 340 million from Multiplan, which had already purchased the other half for R$ 298 million – money used in the construction of the MRV Arena. The sale of the shopping center will have an impact on Atletico football from 2023.

But not one cent of the R$340 million that Atlético will receive, as soon as Cade (Administrative Council for Economic Defense) approves the negotiation, will be used to hire players or pay salaries. All the money will be used to pay off debts, which consumed half a billion reais in interest alone for a decade. In 2021, for example, Galo spent almost BRL 80 million on the cost of debt, which was BRL 1.3 billion in December last year. Money that could be invested in football.

Therefore, the strategy for the board of Atlético is defined and has already begun. The club negotiated with some creditors, who agreed to a reduction of up to 50% of the value with the condition of payment in cash. Galo’s priority is to pay whoever accepts the discount, in addition to onerous debts, those that generate the highest interest. With R$340 million to pay off part of the debts, Atletico’s leaders have an optimistic projection that they will be able to reduce the club’s debt by around R$500 million.

Galo will not be completely free of interest payments, but from 2023 onwards it will not have to spend almost R$ 80 million in revenue with the cost of debt. What will impact football, which will have more money, whether to buy players or increase the payroll.

“The sale of Diamond Mall will allow Atlético to have three, four players of the Hulk’s carat”, said Rafael Menin, who is vice-president of the Deliberative Council and member of the collegiate that currently commands the alvinegro club.

In the negotiation with Multiplan, it was agreed that Atlético-MG will receive R$ 136 million in cash and R$ 204 million in 12 installments, indexed to the official inflation index (IPCA). But in order to receive all the money at once and have the power to negotiate with creditors, the club will make a bank operation to advance payment of the installments.

Debt below R$700 million in December

According to Atlético’s financial statement for the year 2021, the club’s debt was R$1.3 billion in December last year. This amount has already dropped to just over R$ 1.1 billion in the first half of 2022, after some agreements made by Galo’s financial department. With the sale of Diamond Mall and the optimistic scenario projected by the board, Atlético should close the season with a debt below R$ 700 million.

In fact, the projection of the Atletica leadership is that by 2026 the club will no longer have any debt other than the tax, which has already been resolved. In April, Atlético left PROFUT (only in the non-pension PGFN modality), and joined the PERSE (Emergency Program for the Resumption of the Events Sector). This generated a reduction of R$ 51 million in the tax debt.

Patrons will not receive

It is no secret that Atlético’s financial situation does not match the squad that the club has had since the second half of 2020. The purchase of several players and the increase in the salary sheet was only possible due to the financial contribution given by the club’s patrons. It was with the more than R$400 million loaned by the Menin family that Galo managed to assemble the Brazilian champion team and the Copa do Brasil in 2021.

However, none of the proceeds from the sale of the mall will be used to pay the patrons. As the agreement is interest-free, the debt owed to the Menin family will be settled with the proceeds from player sales.

One of the so-called 4 R’s, former president Ricardo Guimarães will also not receive anything related to the sale of the Diamond Mall. In fact, the former Atletico manager has already made an agreement with the current board, in June last year, regarding older loans. Guimarães gave a discount of R$ 70 million to Galo, who will have to pay only R$ 85 million of the R$ 155 million he owed the former president. There will be R$ 65 million in sponsorship of the uniform and another R$ 20 million in installments.

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