Edwards boosts power in £41m share sale

MARTIN EDWARDS sold half of his stake in Manchester United for almost £41m yesterday and still won a major power battle for control at Old Trafford.The chairman and chief executive disposed of 19.5 million shares for £40.9m, but significantly the buyers were various blue-chip investment and business groups rather than individuals.

MARTIN EDWARDS sold half of his stake in Manchester United for almost £41m yesterday and still won a major power battle for control at Old Trafford.The chairman and chief executive disposed of 19.5 million shares for £40.9m, but significantly the buyers were various blue-chip investment and business groups rather than individuals.

While Edwards' holding in United has dropped to just under seven per cent it is to his advantage on two fronts and virtually guarantees his long-term position at Old Trafford. Edwards can now push to become chairman of the plc board when Sir Roland Smith steps down. He has had to sell shares to take on that role where a degree of independence is important.

If Edwards rises to that status, as now seems certain, he will control the purse strings and direction of the club well into the next millennium.

Edwards' sale also reduces the possibility of a major buy-out by wealthy individuals or groups. Although he was happy to sell to Rupert Murdoch's BSkyB, Edwards was less keen to deal with outsiders such as the Irish businessman J P McManus, who was the most significant possible bidder.

In those circumstances Edwards' position and power would have been under threat as McManus planned to promote the manager, Sir Alex Ferguson, to an executive post.

The atmosphere between Edwards and Sir Alex has been frosty recently with the manager keen to spend money and both the club chairman and plc board more cautious with their millions.

Edwards announced record- profits of £32m this week, but warned that Sir Alex could not be given an open cheque book, a point that regularly annoys the ambitious manager. Sir Alex has confirmed that he will retire as manager at the end of the 2001-2002 season and his hopes of staying in some capacity after that date may have ended with this shift in power.

Edwards has profited from his United shares down the years. He had almost 60 per cent of the club at one stage, but has sold off regularly and collected around £100m in the process.

Newcastle United paid a hefty price of almost £4m last season for their failure at the top level of the European game. The Magpies' Champions' League season helped earn profits of £10.8m in the year up to July 1998. But the latest annual operating profits for the year ended July 1999 show a 36 per cent fall of £3.9m to £6.9m this year. This follows a European campaign that lasted just two matches in the Cup-Winners' Cup, compared with eight in the Champions' League the season before.

The Newcastle United plc chairman, Freddie Fletcher, admits success on the pitch is now essential for good business results. "The next step for Newcastle United is to deliver success on the pitch. Results on the pitch are the driver of the business," said Fletcher in his chairman's statement to accompany today's publication of preliminary financial results.

"The [latest financial] results demonstrate the impact of not participating in the Uefa Champions' League," he said. "Over the past 12 months we have built up a strong squad and we believe that our new manager Bobby Robson will provide us with the stability and experience necessary to improve results."