REAL MADRID BREAK THE BANK AGAIN, SIGN CRISTIANO RONALDO

Just a few days ago, Real Madrid signed Brazilian striker Kaka paying AC Milan a record transfer fee of just a bit more than $94 million US dollars.  They’ve gone and broken that record, less than 72 hours later—on Friday morning the London Time reported that Real Madrid will sign Cristiano Ronaldo to a lucrative deal.  To acquire the rights to Ronaldo, Madrid will reportedly pay Manchester United a cool 80 million pound transfer fee—which translates to a staggering $112 million US dollars.

Ronaldo will also enjoy a hefty pay raise, with the Times reporting a base salary of 9.5 million pounds for next season.  The paper indicated that he’d be signing a six year deal with a reported 25% increase in salary for each year of the contract.  For the life of the deal, Ronaldo will pocket 107 million pounds or just under $150 million US.  While the contract hasn’t been finalized, Ronaldo’s recent comments suggest that it’s all but a done deal:

''I have had my time at Man United. It's time to look forward and £80m is quite a sum of money. This deal is historic. It’s flattering when two of the top teams in the world want you to play for them. Now I can look forward to Real Madrid and a new stage in my career. I learned of the deal here in LA and heard from my people that United had accepted.''

Joe McLean, a partner with the international business consulting firm Grant Thornton, suggests that a lot of high priced athletes now playing in England are looking to take their game elsewhere in response to a big income tax increase in the UK:

''By going to Spain, Ronaldo will be paying several million pounds a year less in tax. 'His advisors will undoubtedly have been saying to him that, although Manchester United and Real Madrid are both superstar clubs, the fact is in the UK he will pay £5m in tax on £10m, whereas in Spain it will be £2.5m. Over a four-year contract that's a huge amount of money, so it becomes of relevance. It might not be a major factor in deciding where players go, but it is certainly a factor.''

Reports indicate that Spanish banking giant Banco Santander has provided Real Madrid with a significant line of credit and that they may not be done with their spending spree.  The next target is likely Valencia striker David Villa who could join the fold by the end of the month.  All of this free spending has incurred the wrath of UEFA Chief Executive Michael Platin, who has called for strict financial limits on transfers.