The Red Knights, the group of wealthy Manchester United supporters hoping to wrest control from the Glazer family, expect to make a formal bid for the club in the close season.
The group met in London with the Japanese investment bank Nomura yesterday but, although they are confident of putting together an offer for a club that now carries more than £700 million of debt, there is a realisation that unless there is a dramatic fall in revenue caused by a season-ticket boycott, the Glazers are unlikely even to sit down and discuss it.
Having refinanced the debt through a £509m bond that does not require repayment for seven years, the Glazers have bought themselves time. If they are to sell Manchester United for more than the £800m they paid for it in 2005, analysts say there is no reason for them to do a deal with the Red Knights in the midst of a recession. Despite interest payments averaging around £41m, the club's turnover is still healthy – United declared a turnover of £144.7m in the six months to December, a rise of 20 per cent.
"The Glazers can wait six years until the economy improves and the value of Manchester United rises," said one leading football analyst, David Bick. "Why should they sell at a recession price? The only thing that would force them to negotiate is a dramatic fall in revenue, and the most likely way for that to come about is through a season-ticket boycott.
"The Green and Gold campaign [organised by the Manchester United Supporters Trust] has had a marvellous impact in terms of publicity but the Glazers have proved they are prepared to take dogs' abuse to cling on to Manchester United. They have not been hit in the pocket."
The Red Knights' original plan envisaged 50 wealthy supporters contributing £10-15m each, another 100 investing between £1m and £5m to raise a total of £700m. More problematically at the time was a hope that 100,000 United fans would stump up £2,500 each. That may not be such a pipedream given that membership of MUST has trebled from an estimated 50,000 to 150,000 in a month.
"The freeze in season-ticket prices announced recently is something I don't think would have happened without that protest," said Bick. "But the most pressing issue for the Glazers is their payment in kind (PIK) debt which stands at £202m and is racking up interest at the rate of 14.25 per cent.
"The PIK debt rolls up, so if you borrow £100m and don't pay it off, you owe £114.25m at the end of the year. I imagine that when the Glazers bought United, they did not envisage this PIK debt being around for five years. That would have to be renegotiated.
"Whatever they say in public, the interest payments have to be affecting United's ability to operate as they once did. In purely financial terms, the club are travelling down the same road as Liverpool but a few steps behind."
Key people behind the bid
Keith Harris Former Football League chairman who was involved in takeovers at Chelsea, Aston Villa, Manchester City and West Ham.
Jim O'Neill Goldman Sachs chief economist who was a United non-executive director before Glazer takeover.
Mark Rawlinson Partner in corporate law firm Freshfields. He advised United on the Glazer takeover.
Paul Marshall Partner in hedge fund Marshall Wace, he has an estimated fortune of over £200m.
Richard Hytner Deputy chairman of Saatchi and Saatchi and president of the Manchester United Supporters Trust.Reuse content