He wouldn't kiss the badge but he'd bid for the club behind it. Glazermania comes to Man Utd

Why would a secretive American with no background in 'soccer' pay a massive £800m for a football team? And what will happen to ticket prices? asks Katherine Griffiths in New York
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The Independent Online

Fans of Manchester United have mobilised quickly to try to fend off a possible £800m bid to take their football club private. But it is hard to fight a mystery enemy. So secretive is their adversary that it is the equivalent of Man Utd drawing an obscure Ukrainian side in the Champions League.

Malcolm Glazer - a self-made billionaire who lives in Palm Beach, Florida and owns the Tampa Bay Buccaneers, the American Football team - is the name behind the bid approach for Britain's biggest football club. But even in Florida, little is known about this intensely private 76-year-old - despite the fact that in his six-decade career he has turned a small watch-mending outfit into a mega holding company with many operations, and has been behind bids for brands such as Harley-Davidson, Formica and the internet search engine Excite.

Indeed, Robert Leffler, a director of a holding company called Zapata, which Glazer and his children control, is one of the few insiders prepared to talk about the close-knit clan. "They are very private people. Their strategy is to do the right thing and to do the smart thing and not to talk about it because, if you do, you give away your strategy," he told The Independent on Sunday.

Led by Glazer's son, Joel, the family and their advisers, JP Morgan, are currently negotiating furiously to try to raise funding to finance a formal bid for Man Utd. While the details of their plans remain under wraps, the assumption is that the Glazers will follow a pattern they have tried and tested many times since Malcolm Glazer founded a holding company, First Allied Corporation, and took his business to Wall Street in the 1980s.

Once there, he started to make a string of bold bids, often putting up little of the family's own money, while funding the vast majority of the bid by borrowing or using other assets as collateral. The approach has not always paid off, and has led to persistent accusations of shaky financing.

One example was when Glazer bid $7.6bn (£4.3bn) to buy Consolidated Rail Corporation - or Conrail - from the federal government in the 1980s. He offered just $150m of cash and $7.5bn in other types of financing. The bid did not go ahead, amid rumours that officials believed this little-known businessman, then based in Rochester, New York, did not have the firepower to complete the deal.

It is a version of events challenged by Leffler. He remembers that while Glazer's bid was almost entirely made up of loans, the agreements he had in place were robust and he was still only "one of seven people" approved by Conrail to make a bid.

Displaying an eclectic taste for different sectors, Glazer also made unsolicited - and ultimately unsuccessful - approaches to Formica and Harley-Davidson in the late 1980s. In both cases, the bids ended in acrimony, with Glazer suing Formica on the grounds that its managers had not properly disclosed that their plan was to take the company private. He nonetheless made a profit of about $3m from selling his stake ahead of the buy-out of the laminates maker.

He also ended up in court against the iconic motorcycle maker, which sought an injunction against him further increasing his stake. Again, he walked away with a substantial profit from divesting his shares.

Assessing how much cash the Glazers have is difficult because First Allied remains a private company, though Forbes magazine recently valued Malcolm Glazer's wealth at $1bn.

The son of a Lithuanian immigrant, who started by helping his father mend watches when he was eight, Glazer has built up a wide-ranging operation. After watches, he moved on to creating his own business managing mobile homes. These days, he and his children run an empire which includes shopping centres and nursing homes.

They also own just over 50 per cent of Zapata, a quoted company in which they have steadily increased their stake and which was originally set up by the former president George Bush Snr in the 1950s as an oil and gas business.

Avram Glazer, a son of Malcolm, is now the chief executive of Zapata and another son, Bryan, and daughter, Darcie, are among its directors.

Zapata has controlling stakes in two subsidiaries: Safety Components, which makes airbags; and Omega Protein, which produces fish oils. Earlier this year, Zapata and Omega attracted the attention of US regulator the Securities and Exchange Commission because their share prices had spiked upwards. The Glazers were forced to break their habit of not speaking publicly, saying they had had nothing to do with any activity which had driven the shares up.

The family tried for years to break into owning American Football clubs, but were dogged by doubts that they had the cash to satisfy the tough financing standards of America's National Football League.

Finally, in 1995, they succeeded in buying the Tampa Bay Buccaneers. Glazer paid $192m for the Florida team, in a deal which was passed by the NFL even though it included alternative sources of financing as well as cash.

If Man Utd fans - who are already organising a campaign to oppose Glazer through their website, Shareholdersunited.org - want an inkling of what life would be like under Glazer, they could study his nine-year record at Tampa.

The transformation was dramatic, from a dog of the football league to winning the Super Bowl two years ago. Tampa has looked shaky this year, with the loss of two popular players, John Lynch and Warren Sapp. But Glazer supporters such as Pete Prisco, a sportswriter for CBS Sportsline.com, believes they reinvigorated the Bucs and turned them into a profitable team.

"What they did to the franchise is incredible," he said. "The stadium was a dump and fans were apathetic. Now there is a beautiful stadium and a waiting list for tickets." The stadium, though, was paid for by the local council, not Mr Glazer.

The management style has not gone down as well among many local people in Tampa. John Cullaro, a local lawyer, sued Glazer on behalf of his father, a season-ticket holder who found himself placed in an undesirable seat in the stadium in 1998 even though he'd had a ticket since 1976. He and many other local residents contended that the best tickets were going to corporate sponsors and other VIPs, rather than being assigned on the basis of how long people had been fans.

"Glazer has spent a tremendous amount of money on the team, but when seats were configured in the new stadium, they were not assigned according to the stated priority. The beef with Glazer is that he seems transient. He does not live in Tampa and it is always rumoured that he will sell out for a maximum profit," said Cullaro.

That is a concern exercising the fans of Man Utd, who argue that Glazer has never set foot inside Old Trafford. Even his son, Joel, the vice-president of the Bucs, is not known for his familiarity with English "soccer".

Another concern is that the Glazers would push up the price of tickets as, say some critics, they have done at Tampa, which is now the third- most expensive NFL team to watch, according to official NFL figures. At Man Utd, with heavy repayments to make on the financing on any takeover, a similar pattern could follow.

Vinay Bedi of Wise Speke, the stockbroker, said of Glazer: "If he offers £800m, he is paying more than four times its sales. He must have some pretty good reasons why he can boost profitability. He probably does have better knowledge of how to exploit the brand in the US than the current board."

Man Utd already have a small presence in the US: they have an agreement with the New York Yankees under which their matches run on the Yankees' TV network, YES. That the Yankees' owner, George Steinbrenner, lives in Tampa, of all places, could just be a coincidence.

But like so many things to do with the Glazer family - you never know.

IRELAND'S RACING SHAREHOLDERS AND AMERICA'S DARK HORSE

On Friday morning, US time, the Irish racehorse owners J P McManus and John Magnier decided to return Malcolm Glazer's calls.

Glazer's advisers ,JP Morgan, had been trying to get in touch with the duo ever since the American tycoon contacted Manchester United on Monday morning and said he was thinking about making a bid. Glazer is Man Utd's second- largest shareholder, with 19.2 per cent. The Irish duo hold 29.9 per cent though a company called Cubic Expression.

Glazer is understood to have offered just under £3 a share for the Cubic Expression stake - an offer which would leave McManus and Magnier enjoying a £70m profit on their holding. However, they want more. A price of £3.20 is mooted, which would value the club at £840m.

The talks between the Glazer family and Cubic Expression could bring to an end the two- year soap opera which has afflicted Man Utd.

This started when Cubic Expression began buying shares in the company. Their initial major purchase was at just 120p a share. Although the Irish duo have always said that their investment in Man Utd is just that, it was assumed that their stakebuilding was linked to a disagreement with Man Utd's manager, Sir Alex Ferguson, over the ownership of a racehorse. By the time, Cubic Expression had built its stake to 29.9 per cent and was asking pointed questions about the club's transfer dealings, this dispute was resolved. Sir Alex was not the winner.

No one expected Cubic Expression to make an offer. With Glazer it was a different matter. He started buying in March last year. By October he had 9.66 per cent, in December 14.3 per cent, and this June 19.2 per cent. In March he backed himself into a corner by making a statement that he had no plans to make a bid.

But now he has changed his mind. He wants Man Utd, and at this price, he might get it.

Jason Nissé

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