Glazers were 15 minutes from defeat when bank stepped in
New book reveals late drama over funding in takeover of Man Utd
Cahal Milmo is the chief reporter of The Independent and has been with the paper since 2000. He was born in London and previously worked at the Press Association news agency. He has reported on assignment at home and abroad, including Rwanda, Sudan and Burkina Faso, the phone hacking scandal and the London Olympics. In his spare time he is a keen runner and cyclist, and keeps an allotment.
Sunday 18 February 2007
The prolonged takeover of Manchester United by US sports tycoon Malcolm Glazer in 2005 came within 15 minutes of collapsing.
The claim is contained in a new book by Mihir Bose, the sports editor at the BBC. In his work, entitled Manchester Disunited, Mr Bose claims that investment bank NM Rothschild stepped in at the last minute to provide part of the financing for the £800m deal when money from one of the Glazer family's hedge fund backers in New York failed to be transferred in time to buy the shares in Man Utd held by Irish duo JP McManus and John Garnier.
The pair's 28.9 per cent stake was held in Crest, a paperless trading system. In order to buy the duo's holding in Man Utd on 12 May - the day of the planned takeover - the Glazers had to pay the money into the Crest system by 2pm. But at 1.45pm, the funds had still not arrived.
In a chapter called "How Rothschild rescued the Glazers' dream", Mr Bose quotes Majid Ishaq, a banker at Rothschilds, as saying: "We didn't have all the money through from the hedge funds. They were wiring instructions from New York and one of them got a digit wrong ... We were worried what the Irish might think. The Irish may have wondered if the Glazers had the money or not. Who knows if the board would then go to the Irish and get them to reverse their decision to sell. We were very worried."
According to Mr Bose, Mr Ishaq and fellow Rothschild banker Robert Leitao pledged their bank's own funds to Crest to make up the shortfall without first securing the sum - believed to be close to £100m - from Rothschild's financial arm. The cash from the US hedge fund did not arrive until 2.30pm - too late to buy out the Irish duo's stake.
By the end of the day, the Glazers held 68 per cent of Man Utd's shares, ensuring they would have no trouble reaching the 75 per cent level needed to complete the takeover.
The Glazers' attempts to buy Man Utd infuriated fans, who campaigned vociferously for the Man Utd board to oppose the takeover attempt.
Mr Bose's book also reveals that had the board shown the "courage to brand Glazer a hostile bidder", his financial backers for the deal, led by JP Morgan, would have walked away.
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