Spanish Football in Need of Financial Therapy: Cut Expenses and Inject Capital
European football in general and Spanish football in particular is experiencing huge financial difficulties. This paper analyzes Spanish clubs during the period from 2007 until 2011, using Altman’s models to classify clubs according to their Z-score values. Through these models, the determinants of the clubs’ poor financial situation are identified. The evidence suggests that Spanish football is in very poor financial condition. To improve its situation what is required is a substantial injection of capital funding through issuing shares or asking for substantial contributions from members, increasing revenues, reducing wages and salaries, and working to reduce current liabilities.