Liverpool are preparing to shatter the British transfer record for a second time this summer with a £120-130 million bid for Newcastle United striker Alexander Isak.
The Premier League champions have already spent £116 million on German midfielder Florian Wirtz, breaking the previous British record, and are now accelerating efforts to secure the Swedish forward.
Reports indicate Liverpool have formally expressed interest in Isak, with discussions around a £120 million fee taking place with Newcastle.
The potential deal would take Liverpool's summer spending to approximately £300 million, a dramatic increase from last year when they spent just £10 million on Federico Chiesa and £25 million on Giorgi Mamardashvili.
PA | Newcastle have no intention of selling Alexander Isak this summerLiverpool have made moves towards securing Isak in recent days after exploring other centre-forward options, including Eintracht Frankfurt star Hugo Ekitike.
Football finance expert Kieran Maguire has explained how Liverpool can afford such significant outlays whilst remaining compliant with Premier League profit and sustainability rules.
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"Liverpool are in a position of strength," Maguire told TBR Football. "They were quiet in the market last year, and they have sold one or two peripheral players – others are likely to leave."
The club posted a positive PSR margin of £48 million for the previous financial year ending 31 May. When combined with the £105 million permitted in cumulative losses over a three-year period, this gives Liverpool an effective headroom of £153 million under league regulations.
Club revenues are reported to have exceeded £700 million for the year, driven by increased commercial earnings and deep Champions League runs.
Liverpool's summer spending spree has already seen them invest over £170 million on new signings, with German sensation Florian Wirtz arriving for £116 million in what was initially a British record fee.
The Reds have also secured Hungarian left-back Milos Kerkez for £40 million and versatile wing-back Jeremie Frimpong for £30 million, according to multiple reports.
Georgian goalkeeper Giorgi Mamardashvili joined for £25 million, whilst these additions total an estimated £185 million, underlining the club's intent to build a squad capable of competing on all fronts.
The aggressive summer rebuild under Arne Slot represents a significant departure from Liverpool's typically measured approach to the transfer market, with the potential Isak signing set to take their total outlay close to £300 million.
Liverpool's financial strength stems from multiple revenue streams that have significantly boosted their spending power this summer.
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PA | Hugo Ekitike has been linked with a move to Liverpool
The club received £175 million in prize money for winning the Premier League title, whilst benefiting from their first full season with an expanded Anfield Road End increasing stadium capacity.
A new kit deal with Adidas, beginning on 1 August, is reportedly worth £60 million per season, exceeding their previous Nike partnership.
The Reds also pocketed more than £85 million from their Champions League campaign, with an impressive League Phase performance offsetting earnings missed from their early last-16 exit.
Their domestic campaign is estimated to have earned approximately £185 million through broadcast fees from domestic and international markets, equal share payments and prize money.
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Reuters | Alexander Isak is a wanted man this summer but Liverpool might have to fork out a nine-figure sum to sign him
Liverpool's model of smart trading could see player sales help fund the Isak move, with Darwin Nunez likely to depart after the club could not agree terms with Napoli, though reported Saudi Arabian interest increases the likelihood of recouping a significant portion of his £85 million fee.
Academy graduates Jarell Quansah and Caoimhin Kelleher have already been sold for £30 million and £18 million respectively, representing pure profit, whilst Harvey Elliott and Tyler Morton have also been linked with moves.
"There's talk about Luis Diaz going too, so it would be a one out, one in basis. I think most people would regard that as an upgrade if Isak comes in," Maguire explained.
"Liverpool are an extremely well-run organisation from top to bottom. They have both funds and PSR/squad cost rules capacity to spend a lot more money this summer."