A reality check on Sergio Cragnotti. The bubble's gonna burst one day and so will tears flow. Reading the self-congratulatory and smug content of the Lazio forum has been as highly entertaining as irritating. Enjoy it while it lasts, for it won't for very long. Oh well, let's just sit back and enjoy our football to come ... juve's football!!
Cragnotti sets an unrelenting pace
Letter from Rome
By Frances Kennedy
17 July 2000
Sergio Cragnotti, the ambitious and outspoken owner of the Italian league champions, Lazio, seems to have a never ending supply of energy, luck and lire. After having spent a record 280bn lire (£93m) on new football talent, including a new world record sum of 110bn lira for the Parma centre-forward Hernan Crespo, he has no intention of stopping. While the Portuguese showman Luis Figo, currently at Barcelona, has been courted by clubs across the continent, the ebullient Lazio boss says simply, "I want him and I will have him".
Whether he achieves that goal is another matter, but Cragnotti, who was once treated as a nouveau riche upstart by the footballing establishment, has forced them to recognise that he is the man to watch. The first to float his club on the stock exchange, Cragnotti has turned Lazio into a powerful brand. Last season, he tripled the club's income from television rights and next season, given that they are the reigning champions of the Serie A, that will net even more cash. He placed Alessandro Nesta on the board to "responsibilise" players and made heavy use of stock options, some £200m worth, to players. Lazio has just secured a sponsorship of 45bn lira over three years from Siemens, which will inject fresh cash. Cragnotti's strong ties with the Banca di Roma mean he can count on almost unlimited credit.
The core of Cragnotti's business activities is Cirio, a huge agriculture and food conglomerate. Economic analysts say Cragnotti's financial empire is not as florid as his football team, and debts, which have reached a worrying level, are shuffled around the various companies in the galaxy.
A high-flying executive with the Ferruzzi chemicals empire (under the late Raul Gardini), Sergio Cragnotti emerged almost unscathed from the Clean Hands corruption probes – he spent three days in jail and then plea bargained. At Ferruzzi, Cragnotti learnt that you have to spend money to make money, and that shrewd buying and selling could yield immense profits. He has put this into practice in football, making Lazio the first publicly quoted Serie A team. This gave him an immense cash injection, but also the obligation of presenting a healthy balance sheet to shareholders annually, something which explains why much of the transfer frenzy occurs in July.
Cragnotti is the undisputed king of what the sporting press has dubbed "il mercato delle plusvalenze" (the capital gains market). He can afford to pay millions for a star attacker provided that within the year he sells another player, or players, for a similar amount. "The teams swap players with stratospheric values without handing over real money with the effect that on paper they manage to balance accounts that are in disorder," Mario Sconcerti, the editor of the daily newspaper Corriere dello Sport, explained.
The 110bn for Crespo is a good example. In effect, Cragnotti pays only one third of that figure, the rest being made up by the exchange of Almeyda and Conceiçao. This system is also useful for clubs to avoid showing much of a profit at the year's end, and therefore a hefty tax bill. What it demands, however, is that the footballers be in perpetual motion, from one club to another, moved like figurines in table football as much, for financial reasons as for their performance.
Cragnotti sets an unrelenting pace
Letter from Rome
By Frances Kennedy
17 July 2000
Sergio Cragnotti, the ambitious and outspoken owner of the Italian league champions, Lazio, seems to have a never ending supply of energy, luck and lire. After having spent a record 280bn lire (£93m) on new football talent, including a new world record sum of 110bn lira for the Parma centre-forward Hernan Crespo, he has no intention of stopping. While the Portuguese showman Luis Figo, currently at Barcelona, has been courted by clubs across the continent, the ebullient Lazio boss says simply, "I want him and I will have him".
Whether he achieves that goal is another matter, but Cragnotti, who was once treated as a nouveau riche upstart by the footballing establishment, has forced them to recognise that he is the man to watch. The first to float his club on the stock exchange, Cragnotti has turned Lazio into a powerful brand. Last season, he tripled the club's income from television rights and next season, given that they are the reigning champions of the Serie A, that will net even more cash. He placed Alessandro Nesta on the board to "responsibilise" players and made heavy use of stock options, some £200m worth, to players. Lazio has just secured a sponsorship of 45bn lira over three years from Siemens, which will inject fresh cash. Cragnotti's strong ties with the Banca di Roma mean he can count on almost unlimited credit.
The core of Cragnotti's business activities is Cirio, a huge agriculture and food conglomerate. Economic analysts say Cragnotti's financial empire is not as florid as his football team, and debts, which have reached a worrying level, are shuffled around the various companies in the galaxy.
A high-flying executive with the Ferruzzi chemicals empire (under the late Raul Gardini), Sergio Cragnotti emerged almost unscathed from the Clean Hands corruption probes – he spent three days in jail and then plea bargained. At Ferruzzi, Cragnotti learnt that you have to spend money to make money, and that shrewd buying and selling could yield immense profits. He has put this into practice in football, making Lazio the first publicly quoted Serie A team. This gave him an immense cash injection, but also the obligation of presenting a healthy balance sheet to shareholders annually, something which explains why much of the transfer frenzy occurs in July.
Cragnotti is the undisputed king of what the sporting press has dubbed "il mercato delle plusvalenze" (the capital gains market). He can afford to pay millions for a star attacker provided that within the year he sells another player, or players, for a similar amount. "The teams swap players with stratospheric values without handing over real money with the effect that on paper they manage to balance accounts that are in disorder," Mario Sconcerti, the editor of the daily newspaper Corriere dello Sport, explained.
The 110bn for Crespo is a good example. In effect, Cragnotti pays only one third of that figure, the rest being made up by the exchange of Almeyda and Conceiçao. This system is also useful for clubs to avoid showing much of a profit at the year's end, and therefore a hefty tax bill. What it demands, however, is that the footballers be in perpetual motion, from one club to another, moved like figurines in table football as much, for financial reasons as for their performance.
