Glazers lay bare fears for future of United

Investors warned that impending end of Ferguson era and Manchester City's wealth present serious threats. Owners may take further loans up to £70m from club

The Glazer family have laid out their deepest fears for Manchester United's future in the offer document for their new £500m bond issue – and most notable among them is the concern that the successor to Sir Alex Ferguson will not be as successful as the 68-year-old Scot.

The subject of Ferguson's retirement, and his likely replacement, is off limits when senior Old Trafford officials speak publicly but they have been forced to address the issue in seeking to raise refinancing for the club's £700m debt. The Independent has seen a copy of the 322-page document in which the club admit to potential investors that replacing Ferguson will be one of their greatest challenges.

Among the 15 pages of "risk factors" outlined for those institutions considering taking up the bond issue, United admit to being "highly dependent" upon management, coaching staff and players "including our manager Sir Alex Ferguson". They add: "Any successor to our manager may not be as successful as he has been."

As well as the replacement for Ferguson, who has served more than 23 years as manager, the document revealed the other fears they have for the club's continuing dominance of English football that has seen them win 11 Premier League titles since the competition began in 1992. They include:

* The rising power of Manchester City. United admit that their continued success, especially in domestic football, is under pressure from clubs that have the backing of wealthy owners.

On page 17 of the document, United say: "We face strong competition from other football clubs in England and Europe. In the Premier League, recent investment from wealthy team owners has led to teams with strong financial backing."

* The prospect of Uefa's new "financial fair play" rules prohibiting clubs such as United from participating in the Champions League if they accrue large debts or persistently spend more than they earn.

The document says: "There is a risk that, in conjunction with increasing player salaries and transfer fees, the financial fair play initiative could limit our ability to acquire or retain top players and, therefore, adversely affect the performance of our first team."

* That United's popularity may drop "in certain countries or regions" if they do not sign high-profile stars from commercially-important regions such as the Far East. This appears to be an acknowledgement of the popularity in Korea that they have earned from the signing of Park Ji-sung.

* The "behaviour" of players. As well as the admission that United are "highly dependent" on the performance of their players, they also say that success is also dependent on "to a lesser degree, the behaviour of players and staff on and off the pitch."

* Spiralling wages for players. United's wage bill for players and staff rose by £28.8m to £121.1m for the last year. On page 16 of the document, United say: "Over the past three years, salaries for players and coaching staff have increased significantly. If there is a continued increase in the level of salaries paid to top players and coaching staff in general, we may be required to increase the salaries we pay to avoid losing key members of the playing and coaching staff. Further increases in salaries may adversely affect our results of operations."

Outlining the risk factors of a bond issue is a standard practice within the industry but for an organisation as secretive as Manchester United, rarely have they had to be as candid about their fears for the future.

The club warn that there is the possibility of a terrorist attack on Old Trafford – "an iconic stadium and a potential target for terrorism" – and its potential for damaging the club's profitability.

The disclosures in the bond issue document have caused dismay for supporters' groups who have long opposed the debt-burden imposed on the club by the Glazers' 2005 takeover.

There has been outrage at the revelation that the Glazers have taken up to £20m out the club in management fees and loans.

There is also a risk that the family will seek to take earnings up to £70m from the club in order to pay back the part of the debt borrowed from hedge funds – the payment-in-kind loans – for which the Glazers are personally liable.

That part of the debt has grown from £138m to £202m and using the club's profits to reduce it could yet impact on the transfer funds at Ferguson's disposal.

News
Davis says: 'My career has been about filling a niche - there were fewer short actors and fewer roles – but now I'm being offered all kinds of things'
PeopleWarwick Davis on Ricky Gervais, Harry Potter and his perfect role
Voices
A Russian hunter at the Medved bear-hunting lodge in Siberia
Save the tigerWildlife charities turn to those who kill animals to help save them
News
i100
Sport
Frank Lampard will pass Billy Wright and equal Bobby Charton’s caps tally of 106 caps against
sportFormer Chelsea midfielder in Etihad stopgap before New York contract
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
The first film introduced Daniel Radcliffe to our screens, pictured here as he prepares to board the train to Hogwarts for the first time.
booksHow reading Harry Potter helps children grow up to be gay-friendly
Arts and Entertainment
A scene from Aladdin is performed at the Tony Awards in New York in June
theatreBrit producer Lythgoe makes kids' musical comedy a Los Angeles hit
Sport
Usain Bolt of Jamaica smiles and shakes hands with a competitor after Jamaica won their first heat in the men's 4x100m relay
sport
News
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
Caption competition
Caption competition
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

Bleacher Report

Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Day In a Page

Save the Tiger: Meet the hunters tasked with protecting Russia's rare Amur tiger

Hunters protect Russia's rare Amur tiger

In an unusual move, wildlife charities have enlisted those who kill animals to help save them. Oliver Poole travels to Siberia to investigate
Transfers: How has your club fared in summer sales?

How has your club fared in summer sales?

Who have bagged the bargain buys and who have landed the giant turkeys
Warwick Davis: The British actor on Ricky Gervais, how the Harry Potter set became his office, and why he'd like to play a spy

'I'm a realist; I know how hard this business is'

Warwick Davis on Ricky Gervais, Harry Potter and his perfect role
The best swim shorts for men: Bag yourself the perfect pair and make a splash this summer

The best swim shorts for men

Bag yourself the perfect pair and make a splash this summer
Has Ukip’s Glastonbury branch really been possessed by the devil?

Has Ukip’s Glastonbury branch really been possessed by the devil?

Meet the couple blamed for bringing Lucifer into local politics
Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup