As Malcolm Glazer yesterday took full control of Manchester United by raising his stake above 75 per cent, it emerged that he has been in secret talks with a controversial billionaire casino mogul over ways in which Glazer might exploit Britain's boom in gambling to help pay for his acquisition of United.
A week ago, United announced a joint venture with Las Vegas Sands, an American casino firm, to build a massive gambling complex on land adjacent to Old Trafford. LVS is owned by Sheldon Adelson, the world's 19th richest man, who was once described as "perhaps the most vilified man in Nevada".
The day after United and LVS announced their link-up, Glazer, who had long been aware that United were trying to enter the casino business, executed his coup to buy out United's major shareholders, John Magnier and J P McManus. That purchase gained him effective control of United, which is now formally owned by a Glazer investment vehicle, Red Football Partnership. RFP's official headquarters, for tax and legal reasons, is based in Reno, Nevada, not far from Adelson's own HQ. It is not known whether there is a specific reason, related to casino ownership, that Glazer based RFP in Nevada.
Although the super-casino at Old Trafford is likely to face hurdles, including possible protests from British unions on the basis of Adelson's employment record in America, it might hold one clue as to why Glazer feels United can become profitable for him.
Casinos have helped Adelson, 71, amass a fortune of some £8bn, and his showpiece venue, the Venetian in Las Vegas (which has its own Grand Canal and a replica of St Mark's Square), is the largest and most profitable in the city. His business practices were condemned in the House of Commons last year by the Labour MP Andrew Dismore.
Glazer confirmed yesterday that he had raised his holding in United to 75.7 per cent, as part of his £790m takeover of the entire club.
Now that the 75 per cent threshold has been passed, Glazer can delist Manchester United plc from the London Stock Exchange and implement new plans for the club without having to seek approval from other shareholders.
The delisting is likely within a month or two. Glazer can also load the club with the debts he has acquired to buy United, starting with the £265m he has borrowed in bank loans. It is likely that within months he will also restructure more debt, of £275m in "preference shares", to make the club directly liable for that too.
Glazer's next step will be to send his offer document to shareholders giving detailed information about the share offer. That will put in place a timetable from the UK's Takeover Panel giving Glazer a 60-day period in which to complete his acquisition. The offer document is expected to be posted some time this week.
A major concern is where he intends to make fresh profits. Ticket price hikes are likely. Naming rights to the stadium are probable. A sale and leaseback of Old Trafford is also possible. But expanding other revenue streams, including breaking up the Premier League's TV rights' deal, are more problematic. A casino business, in Manchester or over a wider area, could be Glazer's answer.
Glazer has failed so far to make any public statement over his business plan, which United's chief executive, David Gill, has described as "aggressive".
Gill could yet find himself in the extraordinary position of working for Glazer, although neither he nor his manager, Sir Alex Ferguson, have commented on whether they intend to stay.
A meeting of some fans' groups will be held in Manchester today, to take the first steps towards establishing a breakaway club.
"We are calling on all supporters to wear black in Cardiff on Saturday," said a supporters' spokesman, Mark Longden. "In addition, people should decline to renew their season tickets and memberships and cancel subscriptions to MUTV.
"We would also urge them to boycott the products of sponsors such as Vodafone, Nike, Budweiser and Audi and explain to those companies why."Reuse content