The role of agents in multimillion-pound football transfer deals came under fresh scrutiny yesterday after Manchester United revealed payments of £11m to middle-men for their help in signing players.
Britain's most famous club's latest accounts show it paid £5.5m to agents in the 12 months to 31 July, and owed a further £3.5m from past deals, including the £30m transfer of the defender Rio Ferdinand from Leeds United. The former Premiership champions are also paying up to £1.5m to the agents involved in transferring Wayne Rooney from Everton for up to £29.85m, completed after the end of the last financial year.
David Gill, Manchester United's chief executive, defended the payments to agents as representing good value for the club. He insisted that agents were an essential part of the modern game.
However, he said that Sir Alex Ferguson, the manager, would have to sell players before he could sign any new stars because the club had spent its entire transfer budget for next summer on the Rooney deal. "Alex was clear when we approved it as a board that this [the Rooney deal] was an acceleration of spending," Mr Gill said.
The Rooney deal will involve payments to the player's agency, Proactive Sports Management where he is looked after by Paul Stretford, of up to £1.5m.
The disclosures on agents' fees came in the club's annual results, published yesterday, for the year to 31 July. They include deals involving middle-men such as Pini Zahavi, who famously met the England manager Sven Goran Eriksson at the London home of Chelsea's owner Roman Abramovich. Mr Zahavi and his fellow agent Branko Stojic earned £750,000 when Louis Saha was transferred from Fulham.
Other agents who shared in the huge fees paid by Manchester United include Roger Linse, Ruud van Nistelrooy's agent. He was paid £1.2m for negotiating a new contract for the striker with the Old Trafford club which was agreed in January this year.
Yesterday was the first time that agents' fees have been detailed on a transfer-by-transfer basis by a football club and comes as pressure mounts for all clubs to lay bare the finances of player transfers.
Mr Gill said he hoped other clubs would follow Manchester United's lead and agreed that publicising agents' fees was one way of trying to cut them over time. The annual results revealed that a further £500,000 had gone to the agents involved in selling Juan Sebastian Veron to Chelsea, making a total of £11m paid to agents since the start of August 2003.
The lion's share of the £5.5m paid to agents in the 12 months to 31 July went on five transfers, including the signing of Ronaldo from Sporting Lisbon, which involved a £1.1m payment to Giovanni Branchini. Alex Black, the agent for Alan Smith, was paid £750,000 when the striker moved from Leeds United after the end of last season.
The club's move to greater disclosure follows a demand for it to reveal details of its payments to agents which was made earlier this year by Cubic Expression, one of its leading shareholders. Cubic Expression is the investment vehicle of the Irish racing tycoons JP McManus and John Magnier.
In May, the club agreed to more openness after an internal investigation revealed it had paid £13m to agents over the past three years. It pledged to sever all ties with Elite Sports, an agency part-owned by Jason Ferguson, the son of Sir Alex.
Yesterday's results showed the club's revenue fell to £169m from £173m last year, but operating profit rose 5.9 per cent to £58.3m. Revenues were hit by fewer games played at home, the club said. It also warned of a sharp drop in revenues from television and other media in the next year, partly because of the club's failure to finish in the top two in the Premiership.
"Having finished third in the 2003-04 season, media revenues from the Champions' League will also reduce by about £6m," the club revealed. "Revenue from the domestic Premiership television deal would fall by about £8m this year and then stay flat over the following two years," the club said.
The club has also been the regular subject of takeover speculation involving Malcolm Glazer, a US entrepreneur who owns the Tampa Bay Buccaneers American football team. Mr Gill said he would discuss the results with Mr Glazer.
Big deals - and big profits for the agents
Ruud Van Nistelrooy
The prolific 28-year-old Dutch international striker joined United in 2001, a year late due to injury. United eventually paid £19m to PSV Eindhoven. Fees due to his agent, Rodger Linse, were staggered over the contract period, with £468,000 still owing before last season. An extension in January this year pushed those fees to £1.67m, £331,000 of which was paid last season, with the rest due by 2008.
The Portuguese prodigy joined United in the summer of last year, aged 18, for a transfer fee of £12m. He was expected to be "blooded" but quickly became a key player in the No 7 shirt inherited from David Beckham. His progress was such that he secured a place in his national side and starred for the host nation in Portugal at Euro 2004, United paid all the agent's fees for the deal, £1.13m, last season.
The 26-year-old Argentinian international defender joined United in June for £6.9m with much expected of him, not least because of the club's frailties at the back. Before he kicked a ball at Old Trafford, he was off to Greece to represent his country at the Olympics - a decision that did not go down too well with Sir Alex Ferguson - and returned with a gold medal. United have paid £100,000 of £525,000 due to his agent.Reuse content