Would a change in ownership be a good or a bad thing for Manchester United?

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The Independent Online

In Malcolm Glazer's dream scenario, he will take control of Manchester United, brandish the golden key to the lucrative (but arguably mythical) American and Asian markets, and then start plotting towards the fateful day when English football clubs are given the freedom to negotiate their own television deals.

In Malcolm Glazer's dream scenario, he will take control of Manchester United, brandish the golden key to the lucrative (but arguably mythical) American and Asian markets, and then start plotting towards the fateful day when English football clubs are given the freedom to negotiate their own television deals.

If and when that day arrives - perhaps within three years, quite probably within a decade - he will be in a position to reap the rewards of United's global fanbase, exploit the armchair fan for every pound, dollar, yuan and yen he can extract, and, in all likelihood, help to widen the financial abyss between football's "haves" and "have-nots" to irrecoverable levels. That would constitute success.

In the meantime, he might take some of his own fortune, which at around £560m, including assets, is not to be sniffed at but far from Abramovich-esque, and enable Sir Alex Ferguson, or whoever replaces him in the shake-up, to increase his spending power, by a relatively small amount.

Analysts are sceptical that Glazer will be able to raise enough money to make a bid unless he sells his holding in the Tampa Bay Buccaneers (unlikely) or part of his American property portfolio, and even that might leave United little room for spending on players.

If Glazer's takeover goes well, and he can borrow enough cash against United's future earnings to fund it, he might, however, allow United's manager to go on the kind of spree not seen (outside of Chelsea) since Peter Ridsdale was signing the cheques as he "lived the dream" on borrowed money at Leeds United.

And therein lies just one potential problem for Glazer, the 76-year-old American "sports tycoon" whose only major sporting success to date has been the purchase of the Buccaneers. (He paid $192m [£107m] for them in 1995 and transformed them into Super Bowl winners by 2003, trebling the value of the franchise in the process). On the flip side of his dream scenario is a nightmare, not just for him but for United's fans.

Glazer will have to borrow heavily to buy United. With the club's value rising to around £700m yesterday, the purchase price, not to mention working capital, is beyond his reach on his own. The investment bankers, JP Morgan, are understood to be already looking to raise capital for Glazer, although they declined to comment yesterday. It seems Glazer's buy out would be guaranteed in a securitisation deal against United's future earnings. Leeds similarly borrowed against future earnings only for Ridsdale's dream to collapse.

If Glazer seeks total control of United, the logical extension is that he will delist the company at some stage, removing the checks and balances of a plc, limited though they often prove and irrelevant as they were at Leeds. Glazer has, to date, shown no inclination to be transparent about his intentions or answer to anyone. The nearest he came, earlier this year, was to issue a statement to the Stock Exchange, and then only under pressure, to say that he might (or might not) bid for United in the future. If his ownership style at the Buccaneers is any indication, he will not want the inconvenience of answering to a board and shareholders.

A scenario in which a delisted United, with heavy debts, is under the sole control of a foreign owner with no background in football might seem unlikely now, as does one in which United have a terrible season or two and fail to qualify for the Champions' League. Yet since the demise of Leeds, the phrase, "It just couldn't happen" no longer holds water.

So there are the two extreme scenarios: a dominant, thriving United who turn their back on the ethos of collective rights bargaining and profit from it to the detriment of everyone else via Glazer's links to media magnates such as Rupert Murdoch; or a debt-laden United who teeter one or two bad seasons from the slippery slope of Leeds.

Somewhere in between lies what is likelier for United under a Glazer regime, which might be nowhere near as seismic. Glazer could raise enough finance to buy the 28.89 per cent holding of JP McManus and John Magnier and satisfy himself with majority (and effective) control. Nothing much need change, although Glazer will clearly want to recoup his investment somehow, possibly by raising ticket prices, as he has done at the Buccaneers.

The most pertinent question remains, however: why on earth would United's board recommend any takeover by Glazer, based on future earnings from hitherto untapped markets, when an effective plc with decent management could tap those markets itself? The easy answer is if he offers a large financial incentive to existing shareholders.

Yet that in itself is not the only factor the board will consider, not least because around 18 per cent of United is owned collectively by fans with small stakes. Those same fans, including many members of the influential Shareholders United group and the Independent Manchester United Supporters' Association, will also campaign against any takeover by Glazer, as they did against Murdoch in 1998 and again last year at the merest hint that McManus and Magnier wanted control. By pressing ahead, Glazer risks not only acres of bad publicity but alienating the very customers on whom he would rely to make money.

A mistaken belief that he can somehow tap enormous extra income from a business already near the top of its market might yet prove a headache for Glazer. His ignorance of English football culture, especially at United, may do likewise. In the past few weeks the Buccaneers have had PR headaches over performance (no wins from four games), ticket prices (rising steeply, 20 per cent this year), heavy-handedness (a season ticket holder thrown out for flying a Stars & Stripes) and lack of public spirit (refusing refunds to fans affected by Hurricane Charley). It would take a lot less at United to see him branded as an unwanted, mercenary chancer with no understanding of the club. And the fans might not put it so politely.

BUYING INTO THE DREAM WINNERS AND LOSERS IN THE STRUGGLES TO OWN UNITED

1902

John Henry Davies, managing director of Manchester Breweries, invested £60,000 in Newton Heath, with debts of more than £2,500, and changed the club's name to Manchester United.

1931

James W Gibson, a manufacturer of army uniforms, injected £30,000, settling outstanding debts and paying wages.

1958

Louis Edwards, owner of a large company of wholesale meat suppliers, became a director. He bought up shares progressively so that in 1964 he became a majority shareholder (51 per cent) and was appointed chairman.

1980

Martin Edwards, already on the board of directors, inherited his father's stake after his death.

1984

Martin Edwards rejected a £10m bid from the newspaper magnate Robert Maxwell.

1989

Michael Knighton appeared to have bought the club for £20m, with Edwards due to receive £10m for his stake. The deal fell through when it became apparent that Knighton did not have the necessary funds.

1998

Manchester United plc, having floated in 1991, accepted a £623m bid from BSkyB which was eventually rejected.

2001

JP McManus and John Magnier bought £30m of shares through their company, Cubic Expression.

2004

United announce an initial approach from Malcom Glazer.

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