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Reformed German giants Schalke 04 escape near bankruptcy to return to Bundesliga

Schalke 04's roots in German working-class culture in Gelsenkirchen are illustrated in the final verse of Schalke's club hymn, which reads 'one thousand fires in the night', evoking memories of the flames on top of the mine pits, which in earlier times have symbolised the image of the industrial Ruhr area. 

On Saturday, the Schalke Ultras lit flares to celebrate Schalke’s 1-0 win against Fortuna Dusseldorf, which secured their promotion back to the German Bundesliga.

It reads further in the Schalke hymn: "One thousand friends standing together, so that FC Schalke shall never die".

Today, an ironic sentence when you look back at what Schalke has been through as they came very close to being relegated last season, barely escaping the drop to the 3rd. Liga, which, due to a lack of TV funds, would have put them on the verge of bankruptcy, as they could not afford the license to play in the German third division.

According to Schalke expert Toni Lieto from German media “Kicker”, the club, which reached the Champions League semi-final in 2010, is still paying the price for a series of poor business decisions from former de facto club boss, Clement Tonnies, who tarnished their reputation when he was involved in a series of racism and coronavirus-related scandals.

In addition, they are still trying to weather the financial storm following the termination of the lucrative long-term sponsorship deal with Gazprom following Russia's invasion of Ukraine.

CEO Matthias Tillmann, who joined the club in 2024, then told AFP that Schalke's relegation to the second division is a 'mistake': "We are not a second division club when it comes to fans, to infrastructure," he said.

"Obviously, we are there now, and there are reasons for that.

"We've made mistakes on the sporting side, capital allocation... The first relegation in 2021, the beginning of COVID, was very tough financially. Then we immediately went down again, which is not good."

In the previous season, Schalke 04 conceded 62 goals in the 2. Bundesliga with an average of 1.82 goals per game. match. Their defence was particularly vulnerable at home, conceding 35 goals in 17 games.

In the current season, however, Schalke have improved their defence significantly under new coach Miron Muslic and have so far conceded only 28 goals in 32 games, the fewest in the league.

At the age of 32, Loris Karius has played a crucial role in Schalke’s improved defence.

Karius, who will always be remembered for that fatal night in Kyiv eight years ago, where he made two significant errors in Liverpool’s 3-1 defeat to Real Madrid, was close to ending his career before he joined Schalke at the beginning of last year. 

The shot-stopper has played in 29 of his team’s 32 games, conceding on just 24 occasions and keeping 12 clean sheets as the best keeper in 2. Liga. Karius has managed to deliver several match-winning displays, while his save percentage of 73.6 is the highest among first-choice goalkeepers in the second league. 

“Without him, Schalke would not have achieved promotion,” says Lieto to Flashscore. "New coach Muslic sent out an important signal when he announced that Karius would be the first-choice keeper shortly after his arrival. It’s absolutely justified to call him the goalkeeper of the season.” 

Schalke’s record goalscorer and German international legend, Klaus Fischer, has called for Julian Nagelsmann to include him in the World Cup squad. 

Former Czech international Jan Moravek, who played for Schalke between 2009 and 2012, praised the influence of Sports Director Frank Baumann in a column for Flashscore.

Baumann showed great courage when he took a risky and, for many, incomprehensible step: investing £840,000 in the Austrian Miron Muslic, who had just been relegated with Plymouth Argyle to League One, to become the 14th head coach of the club in just six years. 

“Muslic has managed to turn around the extremely negative overall mood at the Veltins-Arena through clear communication, a well-defined approach, strong motivation, and a good feel for the players,” says Lieto. “He demands so much from his players, and that has helped to unite the team.”

Moravek says the story of Musclic (who enjoyed two years with Belgian outfit Cercle Brugge) is reminiscent of Vincent Kompany, who also went to Bayern Munich after falling out with an English club and was influenced by Belgian football.

Both try to be aggressive, practice high pressing, and demand a lot of intensity and emotions from the team.

Another one of Baumann’s ingenious initiatives has been to bring in Bosnian international Edin Dzeko on a free transfer from Fiorentina in January.

Even at 40 years old, Dzeko, who won the German title with Wolfsburg in the 2008/2009 season, has been a steady influence in attack, scoring six goals and helping Schalke navigate a chaotic time of year.

At the age of 39 years, 314 days, Dzeko even became the oldest ever goalscorer in 2. Bundesliga history. The previous record holder, Helmut Haller, was about three months younger than Dzeko when he scored for Augsburg against FSV Frankfurt in February 1979. 

While Dzeko and Karius may be the most recognisable names in Schalke's return to success, Kenan Karaman is arguably the club’s player of the year.

The former Turkey international joined during the 2022/23 relegation season and has performed consistently at a very high level. Even in those first two seasons, during which Schalke were mediocre even by second-division standards, Karaman stood out above the rest. 

Adil Aouchiche, who arrived in the winter transfer window, and Soufian El-Faouzi, who was added to the squad in July last year, also feature regularly in the starting lineup as technically very skilled midfielders who are certain to develop further next season at a higher level.

Despite the promising scenario, there is still a long way to go for Schalke. Eight years ago, they finished second in the Bundesliga and were regular contenders in the Champions League. Last time they were relegated, back in 2021, they returned after a single season, only to be immediately relegated straight back.

So, despite the optimistic mood in Gelsenkirchen, the alarm signals haven't stopped flashing in the background as a warning to maintain the upward trend.

When all the celebrations after achieving promotion have come to an end, Schalke are headed for a very difficult summer in the transfer market with very little money to spend. It will also prove very difficult to hang on to Moussa Sylla, the 26-year-old Mali international, who has been a key presence in the Schalke attack over the season.

“The objective for the club is already clear: Schalke doesn’t want to be fighting relegation again right away. The club’s leadership will try to build a squad that is capable of finishing in mid-table. The foundation is now in place, and Schalke appear more stable now than they have for a long time,” ends Lieto. 

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