Man City continue to reap rewards of £180m transfer goldmine

Last week, Manchester City sold Jahmai Simpson-Pusey to FC Koln for £5m. He only made six appearances for City's senior team and after an unsuccessful loan spell at Celtic, he spent last season in Germany.

City will bank an initial €5.5million from the move while add-ons included could take the final total to €7.5m. City have also inserted a buy-back clause and matching rights into the transfer.

The 20-year-old is the latest chapter of City's incredibly profitable academy that has helped fund such dominance for their first team. MEN Sport spoke to senior lecturer at UCFB and football finance expert Chris Winn about why and how the Blues have succeeded in selling their homegrown talent.

Winn explained that in the past three seasons, up to and including 2025/26, City brought in, on average, £60m per season from academy player sales. That is £180m in what is commonly known as 'pure profit' over the course of the last three seasons, the time period the Premier League's current Profit and Sustainability Rules (PSR) take into account.

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"So if you buy a player, whatever you're paying, the transfer fee plus any costs on top, like agent fees normally, they find their way onto the balance sheet," Winn said. "And then you may have heard the magic word amortisation before, which is used more frequently these days in the coverage.

"That means that the players’ transfer value is reduced over the course of their contract. If you buy a player for £50m on a five-year deal, then you'd amortise that at £10m a year. Which means if you sell that player two years into that deal, that's worth £30m left because you're going from 50 down to 30 over the first two years. So there's still £30m value left on the balance sheet. Sell that player for £100m, and you've got £70m profit.

"Players that have come through the academy are different in that the costs of developing in-house talent can't be attributed to a single player, they never carry a transfer value. Which means that from the accounting side of things, they're not actually on the balance sheets.

"They're accounting value's effectively zero, which means if you sell a player for £100m and they're worth nothing on your sheet, it's 100 per cent profit. All of that £100m in that case, would be accounting profits."

For a club like City, being able to generate 'pure profit' sales frequently, eases things when they hand in their books to the Premier League. From next season though, PSR will be scrapped in favour of the new Squad Cost Ratio (SCR).

City are no strangers to this system having had to adapt their spending to fit UEFA's financial rules that already follow SCR. Currently, the Blues cannot spend any more than 70 per cent of their revenue on players and staff wages, as well as agent fees and other improvements on the pitch, in line with UEFA sanctions.

The Premier League's cap will be 85 per cent but City will be sticking to the 70 per cent rule thanks to their participation in the Champions League. While this could seem unfair on the Blues and other teams in Europe, they should still be able to spend more than clubs not competing in UEFA's competitions thanks to the riches on offer for being in those tournaments.

These new financial rules will not end the incentive to sell academy players, Winn believes in many ways it will only continue the need to do it considering the revenue it generates the Blues. And while that is a sobering thought for fans who want to see young players rise through the ranks, it is not all doom and gloom.

City have a long-standing principle of including buy-back and matching rights clauses into these deals. For instance, should Simpson-Pusey realise his potential in the Bundesliga, the Blues will be at the front of the queue to bring him back.

And the expansion of the Etihad's North Stand, the new hotel and hospitality streams are all diversifying the Blues' revenue.

"City were ranked 6th in the 24/25 Deloitte Football Money League, so in terms of the revenues that they're generating are the sixth highest amount in world football, which means they are already generating huge amounts," Winn said. "So, on the one hand, you could argue that it's brilliant, that City has such a strong academy, which is delivering such talent into the game.

"Be it players that stay at City or move on to other clubs and develop, Morgan Rogers being a great example in that regard. But on the other side, it does give them the ability to be strategic in terms of who they do decide to let go and sell on and the additional headroom that then generates in terms of the financial regulations for them to go and spend elsewhere."

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