Newcastle United have received a fresh £57 million cash injection following the January transfer window through the sale of a single share. The Companies House update published on Friday confirmed the deal was formalised on February 10, less than a fortnight after the signings of Anthony Gordon and Harrison Ashby were announced.
It is not the first time the Magpies have banked a multi-million pound injection under the new owners, with a similar move made in February 2022 to the tune of £40m. An update from JV1 Ltd, a company established by owners Amanda Staveley and Jamie Reuben ahead of the takeover, revealed more than £14m worth of shares were sold in January.
Such updates inevitably prompt social media suggestions of a transfer warchest, with Eddie Howe's side expected to be active again in the summer window. However, football finance expert Kieran Maguire believes it is a repeat of the 'clever' move to address the short-term cashflow issues which clubs can experience following January investment.
READ MORE: Newcastle takeover lawyer Nick De Marco responds to Premier League calls to 're-examine' £300m deal
He told ChronicleLive: "Companies are owned by shareholders, and companies are allowed whenever they so choose to issue new shares to owners. That's what Newcastle have done.
"I think people perhaps get a bit giddy, we've become transfer junkies. You don't need £57m of cash to sign a £57m player, it's all done in installments. It's more to deal with the club's commitments.
"There was plenty of time before the year end, you've got the February and March payroll which is more important than anything else. Normally you pay an amount up front and then further installments, so a lot of money would have probably gone out of the accounts in January which suggests to me they might potentially need money for payroll purposes for February."
The sale of a single share for £57m will inevitably raise eyebrows among football fans, especially in the light of FFP regulations which are often cited as a roadblock to Newcastle's spending. However, Maguire explains it is a move which simultaneously preserves the club's ownership structure while allowing for substantial off-field investment.
The Price of Football podcast host added: "The aim here is to not distort the existing relationship between shareholders in terms of the percentage owned by each individual party. Therefore, by issuing one share for £57m which appears to be the case, given there are millions of shares in issue, on a percentage basis it makes no change.
"The important thing is it provides additional funding to the club to use at it sees fit. It's a good way of preserving the existing relationship between shareholders.
"Owners are entitled to put as much money into a club as they so desire, that's always been the case. For FFP purposes, it is only the first £90 million over a rolling three-year period that counts to the calculations.
"It could be that £57m is going to infrastructure projects which are exempt from FFP anyway. I think some of the critics are conflating additional cash with FFP, the two things are independent because the cash doesn't have to be necessarily be used for operational purposes, and you are allowed to contribute an amount anyway."
Sporting director Dan Ashworth and Howe have both warned in recent months that Newcastle's transfer spending since the takeover is unsustainable. While the latest injection could help cover the deficit from the arrivals of Gordon and Ashby, as well as installments due on deals from the previous January window, Maguire feels the upcoming budget will not be influenced by this latest move.
He added: "I think to a certain extent, the transfer budget is going to be determined by player trading and securing new commercial agreements. Those will be more important issues. They also have the benefit of the legacy that was left by Mike Ashley, it was a very beneficial one for anyone wanting to come in and spend significant sums."
READ NEXT
- Meet the exciting striker 'expecting' to be Newcastle's next signing and holds Alan Shearer ambition
- Newcastle told Mason Mount transfer would be 'perfect' as Graham Potter talks Chelsea star's future
- Newcastle told 'secret is out' for 'unbelievable' £25m talent who passes Magpies character test
- Anthony Gordon admits he was 'hurt' by Everton statement after Newcastle transfer
- Newcastle boss gives Ryan Fraser update after Eddie Howe confirms U21s exile
