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Why Sounders are unlikely to offer much more than $2.5M for Wesley’s transfer

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While the transfer feee they can spend on a U22 player is technically unlimited, MLS rules create a strong incentive for a soft cap.

Palmeiras v Defensa y Justicia - Conmebol Recopa Photo by Ueslei Marcelino-Pool/Getty Images

If you’ve been paying close attention to a lot of the MLS transfer rumors lately, you may have picked up on a common theme: the transfer offers all seem to be right around $2.5 million.

That’s the amount the Philadelphia Union are rumored to be offering for a 19-year-old Brazilian; what LAFC is hoping to pay for a Colombian winger; and seems to be where the Sounders would like their offer for Wesley to land.

This is not just a coincidence. As one astute commenter recently pointed out, there’s a very good reason that MLS teams would prefer not to pay much more than that, even though the rules technically allow them to spend an unlimited amount on transfer fees for U22 Initiative players.

To break it down a bit further, this is how MLS set up the rule in regards to potential allocation money windfalls on future transfers of players signed through this initiative:

Potential payout on U22 transfers

Acquisition cost of the Player Revenue share convertible to GAM
Acquisition cost of the Player Revenue share convertible to GAM
≤ $2,500,000 $1,050,000
$3,000,000 $840,000
$3,500,000 $630,000
$4,000,000 $420,000
$4,500,000 $210,000
≥ $5,000,000 $0

Assuming the allocation-money payout for U22 players works the same way it does for other transfers, it’s actually a bit more complicated than this table suggests. In order for a team to claim that full payout, they would also need to recoup any investment they made in acquiring the player, the thinking being that only net profit should be convertible into allocation money. For example, if a team paid $2.5M in transfer fees plus another $500,000 in salary, they’d need to sell the player for at least $3M before getting any allocation money. To get the full $1.05M, they’d need to sell that player for at least $4.05M. This is also why buying a percentage of a player might not be the massive loophole it first appears to be, as that would cut down on the net profit a team can convert into allocation money.

Of course, this rule can also be used to bring on a player with the primary goal of helping a team now, but that doesn’t seem to be how the Sounders intend to utilize it.

Knowing how Sounders GM Garth Lagerwey operates, the Sounders are probably more inclined to walk away from a deal than get into a situation where they feel like they’re overpaying. Lagerwey has been open about the likelihood that any player signed under the U22 Initiative is likely going to need some time to acclimate, and Wesley is already at an age where the window is starting to close on a big-money move to Europe. In order to justify spending much more than $2.5M on a transfer fee, they’d have to think Wesley both helps them win now and is potentially able to be sold for a lot more down the road.