Friday, 8 February 2013

£500m of costs later, could we see a debt free Manchester United again?

For almost eight years, Manchester United has been subject to a financial experiment to see whether a highly leveraged buyout could “work” on a football club. The only other experiment, at Liverpool, ended in a failure that continues to hurt that club to this day. At United, the Glazers’ purchase of the football club with borrowed money has been hugely costly both financially and emotionally, driving a schism between the club and its core support, sometimes even setting fans against each other.

In the last six to twelve months, there have been major developments which mean that the eight year experiment is probably nearing its end. A combination of unexpectedly high growth in TV deals, new commercial revenues (especially new shirt and kit deals), the impact of new regulation on the behaviour of other clubs and the pay down of significant bond debt means we are entering a new phase in United’s finances where it very possible that debt is virtually eliminated in the next few years.

Although undeniably a good thing, supporters should not become too excited about the prospects of a debt free Manchester United. The club has made it clear on its IPO roadshow that it doesn’t expect to spend more on transfers than it has historically. There is no sign whatsoever that the ticket price hikes that followed the Glazer takeover will be reversed. The club continues to refuse (against the advice of government and Parliament) to engage with supporters’ groups. The listing on the New York stock exchange means the owners will continue to prize profits over football. But financially, a big change is underway. This post explains that change.

The story so far: stacking up debt 2005-2010, paying down debt 2010-2012.....
As this blog has described in detail over the last few years, huge debts were loaded onto Manchester United when the Glazers bought the club. By June 2010 these had escalated to over £784m.

The infamous PIK loans were mysteriously repaid in late 2010. At roughly the same time the Glazers started using the cash earned from selling Ronaldo and signing the Aon shirt deal to repay a significant amount of the bonds that had been issued in February 2010. Finally, in August last year, half of the IPO proceeds were used for debt reduction (the other half going to the Glazer family of course). In total, the bond debt has fallen from £509m in June 2010 to £360m at 30th September 2012.

The next chapter..... rapid revenue growth AND higher profit margins
There can be no doubt that United’s media and commercial income is going to rise very significantly in the next three to four years. Unusually in football finance, I believe the club will capture more of this extra income than usual, in other words profit margins will rise above their historic level. This will generate significant cash, allowing debt to be largely eliminated.

Three sources of highly certain revenue growth
There are a number of factors which mean the club’s revenue growth is highly likely to accelerate in the next three years: 
  • Chevrolet. The new shirt deal adds £11.6m pa for the next two years (on top of what Aon pay) and then a further £11.9m pa (for a total of £43.5m pa) from the 2014/15 season.
  • Premier League rights. We have already seen the value of domestic live PL rights rise 70% in the next three year cycle. Total domestic rights (including highlights, online etc) will probably increase around 60% and we are awaiting the outcome of the international sales processes. Taken together, a rise of at least 50% in PL TV income is virtually guaranteed in 2014. Assuming only low growth from the CL and owned rights (MUTV), that would still drive media revenue up 35%.
  • Nike renewal. The long running Nike contract is beginning to pay out back ended profit share AND is up for renegotiation. Looking at other kit deals, an increase of £25m on the current £35-38m pa looks very achievable. Some analysts think the deal will double in value and they could easily be correct.

These three areas alone will add almost £110m to revenue by 2015 (35% of the 2011/12 figure). To put that in context, that’s the equivalent of doubling matchday income.

Other, less certain, sources of growth
Whoever thought of it, the commercial strategy of targeting diverse product categories and geographies has been revolutionary. There remains considerable potential to add new “partnerships” in a number of industry “verticals”. The club have identified 40 industry sectors where it is believed it can sign a global partner, compared to 13 such contracts currently. Add regional partnerships and I see no reason why such sponsorship income should not double again over the next four years, adding another 12% to 2011/12 revenue.

The same argument applies to the new media and mobile segment. Emerging market telecom companies appear to value the “content” link with United and there are plenty more territories to go for.

My forecast is that revenue will increase by over £150m (c. 50%) over the next three years (assuming top 4 PL finishes and CL quarter finals each year), and that of this increase, over £110m (35% growth) is virtually certain, with and the balance is very likely to occur.

Rising margins
If a huge increase in revenue can be forecast with some confidence, there remains more uncertainty over costs. Since the beginning of the PL era, United have reported stable EBITDA* margins in a tight range, throughout the plc and Glazer eras. In other words, costs have tended to rise in line with revenues.

[*EBITDA – “earnings before interest, tax, depreciation and amortisation” – is effectively cash profits before transfers. It is calculated by deducting cash costs from revenue. In 2011/12 cash costs totalled £228.7m and comprised wages and salaries (£161.7m or 71%) and other operating costs (£67m or 29%).]


I believe this pattern of stable margins will change in the future, and that margins will rise sharply above 40%. For this to occur, United’s wages to income ratio will have to fall. United will have to hold onto more of its revenue gains than has historically been the case.





Why margins will rise
The suggestion that a company that has consistently earned margins within a tight range is about to make a step change in profitability should always be treated with great scepticism. This is true even if new revenue sources are supposedly “high margin” (as sponsorship deals are), as such margin can easily leak away to other stakeholders – in this case players and agents.

On this occasion, however, I believe there are new factors that mean United will not have to pass on as much of every extra pound earned in income to the playing squad as it has in the past, in other words that margins can rise sharply.

There are two primary reasons behind this, firstly that much of United’s revenue growth is unusual to the club and not something competitors can replicate, and secondly that Financial Fair Play will effectively work to slowdown wage growth, forcing other clubs to “bank” rather than “spend” their own incremental revenue.

Factor 1: "United only” vs. collective revenues
The first point is very straightforward, if United can grow its income faster than other clubs, it can hang on to more of it. There is an important distinction to be made between collective revenue increases (such as bigger TV deals) and “United only” revenue gains (such as the DHL training kit deal). It is the former that tend to “leak” into player wages because by definition all clubs (or in the case of the Champions League, all major competitors) receive the same income boost. The last PL international rights deal gave every clubs c. £7m extra pa and pretty much without fail they all went and spent it on transfers and salaries. By contrast, if United sign a unique £7m sponsorship deal, the club has far more chance of retaining the cash. Much of the club’s expected revenue growth is going to come from “uncommon” sources; the new Nike deal, the Chevvy deal, the mobile partnerships etc, etc.

At United, the strength of the relationship between wages and (mainly collective) media income since 2000 can be seen in the chart below. The r-squared is 0.69.




By contrast there is not a very strong relationship between total revenue growth, (which includes the expansion of Old Trafford, commercial growth, ticket price rises etc) and wage growth as can be seen below (the r-squared is only 0.26).


Factor 2: FFP and Premier League regulation will change behaviour
Second and more importantly, both FFP and the new Premier League rules are coming and will inevitably change behaviour. The new regulations do not have to work perfectly to have an impact, rather they just have to alter the way other clubs operate. The main impact will be that clubs that risk breaching the rules will “bank” rather than spend additional revenues they earn. Thus the new PL deal will see a large number of clubs not thinking “let’s use this to boost the squad”, but rather “let’s hang on to this money to improve our UEFA breakeven result”. Both City and Chelsea need the £30-40m pa in extra PL revenue to have a hope of complying with FFP. If they spend the windfall, they will fail the test. The Premier League rules are specifically designed to dampen down wage inflation by limiting the amount of additional TV money that can be spent on player salaries.

This is a totally new dynamic in English and European football where previously every extra penny earned (and more) was spent on players. In the longer term, both sets of regulation makes the next Oligarch/oil sheikh takeover less likely too. If a loss of only €45m is permitted each year, it becomes impossible to repeat a Chelsea/City/PSG and initially run up €150m+ losses. In the last fifteen years a new big spending club has come along every few years. This is likely to end and as in any other market, the lack of disruptive new competitors should boost margins.

Wages are still going up, just less quickly than revenue
Despite the dampening effects of regulation, it would be na├»ve to believe that football wages will stop rising. I would expect United’s wage bill to continue to grow substantially over the next few years (in my forecast I have assumed 24% up to 2015, only slightly slower than the 31% seen in the last three years). The key thing to note is that this wage growth is far slower than forecast revenue growth. With income rising c. 50% as described above and costs by only half this, EBITDA would rise 112%, taking margins from 29% last year to over 40% by 2014/15.



Margins over 40% would generate over £100m of surplus cash per year
EBITDA and margins are just a means to an end when looking at a company. Cash is king.

For United, many of the main cash outflows below the EBITDA line are quite certain. Interest this year (post the IPO debt reduction) will be c. £33m. Tax paid will rise as tax losses are used up and profits rise, but in a predictable way. The big uncertainty is transfer spending, and I have assumed £40m net this year and £30m thereafter. Add in £10m per annum of capex and the huge turnaround in “free” cash flow driven by the higher EBITDA becomes clear.



On these forecasts, United will be generating £80-100m of free cash flow in two to three years, and thus there is the opportunity for substantial debt repayment and/or dividends. 

I have assumed a 50/50 debt pay down and dividend split from 2014 onwards. This leads to a sharp fall in the club’s net debt position. Net debt would fall from c. £344m at the end of the last financial year (pro-forma for the IPO) to under £200m in three years. If no dividends were paid, the figure would be near £100m.


When measured against the size and profitability of the company, debt at this level is of no material consequence. The remaining bonds will be easy to refinance well before they are due to be repaid in 2017 at a significantly lower rate than the current 8.75%.

Even if margins don’t break-out, cash flow will rise sharply
Even if margins don’t expand from the historic range, United will generate very significant cash flow in the years to come. If we apply a flat margin of 33% (the average in the last five years) to consensus revenue forecasts, free cash flow in 2015 is still £67m, allowing £25-30m of annual dividends to paid and net debt to fall to 1.1x EBITDA by 2016.

Summary and thoughts
If United continue to qualify for the Champions League and make it out of the group stages, we can say with a high degree of confidence that revenue will rise by at least 35% over the next three years, and is likely to rise by 50% or more.

It is also likely in my view that EBITDA margins will break out from their historic range and could exceed 40%.

If this occurs, United would generate £80-100m of surplus cash each year from 2014/15 and be able to pay material dividends (a yield of almost 2%) AND repay most of the club’s debts. Even if EBITDA margins are only maintained at the average level of the last five years (c.33%), free cash flow generation would still be around £50-70m per annum, allowing substantial debt pay downs.

Many people, including me, have been highly sceptical of the United business model. It appears however that through a combination of luck (the TV boom) and judgement (the commercial strategy), the management have managed to deleverage the balance sheet and keep the club (reasonably) competitive on the pitch. With the net debt down to under £300m, FFP coming in and continued strong commercial growth, we are now facing a radically improving financial position.

None of this make the Glazers good owners for Manchester United. It will take many years before the club makes enough in profits to compensate for the huge costs incurred. If it wasn't for Fergie's miracle work United could have followed Liverpool or even Leeds down the slippery financial slope. However, in light of the rapidly improving finances, the terms of the debate on ownership will inevitably change. The costs will have been incurred (I estimate total costs from the Glazer structure will top £1bn by 2016) but they will start to become an unpleasant historical footnote

As the eight year LBO experiment comes to an end and the financial risk to United ebbs away, the club and its supporters surely need to re-connect. On issues like away allocations, ticket prices and engagement with supporters’ groups the club needs climb out of it bunker. For fans, the financial experiment is thankfully coming to an end, but much remains to be done; on supporter ownership and having a voice in our club and in making sure the cash flows into the football club itself and not the pockets of owners who still show no evidence of caring one jot for supporters.


LUHG

52 comments:

Anonymous said...

Do the glazers want us to be debt free though. What about all the tax benefits?

Andy Geoghegan said...

Great analysis again Andy.

Do you think it's likely that the half IPO proceeds that the Glazers took went towards whatever paid the PIK notes off?

Until we know what happened to this debt, it's still got to be a concern.

bpacman said...

A great post as ever Andersred.

Many people may view the emerging financial situation as a vindication of the Glazer's strategy, but as you rightly point out, this could have all gone horribly wrong were it not for good fortune (the TV deals) and Fergie's continued excellence (albeit I can see that the sponsorship strategy they've adopted has been very succesful).

They gambled with the future of our club and seem to have won, but they could've quite easily cost us everything.

LUHG

GCHQ said...

Do you still reckon we need the Red Knights to come along and save us, Anders?

Come to think of it, what is Keith Harris up to these days...

Oh that's right, he's being blocked by the Football League from taking over Pompey in order to allow the supporters trust to gain control!! You couldn't make it up!!

Humble pie all round me thinks (well apart from yours truly obviously!)

Love United, love the Glazers.

andersred said...

Hi GCHQ,

And the £1bn the whole thing will have cost is of no importance? It was always obvious the domestic TV rights market was going to be impacted by BT? That UEFA and the PL would introduce financial regulation?

They got lucky. Tis all...

anders

H.U said...

Fantastic analysis, Andersred. 1st time reader, but I'll be making many more trips here after this.

Just one question, however. Did you account for (potential) title prize-winning revenue in the figures? I wasn't clear on whether it was included as a part of 'matchday' revenues or not.

Anonymous said...

what is Keith Harris up to these days ?
He seems to have dumped Orville....

Anonymous said...

There are many costs incurred by the takeover, most importantly that attending matches has become unaffordable. For many of us a large important part of our existence has been stolen from us. Love united detest glazers

Phil Blackwell said...

The value of hindsight is a wonderful thing. In 2005 it was clear that the potential risks involved with the Glazer takeover were great. Although united's governance had left a lot to be desired (Edwards, PLC) the prospect of becoming a plaything of the banks left most with a sense of depression. At the time it was thought that a Ferguson backed renounciation of the proposed takeover would have stopped it in its tracks. Now it is clear that due to the on the field success we have in effect ensured that the Glazers have the club were they want it. Fans should never forget that the Glazers took very little risks in taking over the club, and for the past 7 years we have been a Champions League qualification away from the whole sorry decarcle going spectacularly belly up.
Still I suppose that's business and sadly now business = football = business.

Andy said...

Just been reading the Bluevibe forum. They treat you like some sort of comedy character on there! Take a look.

Is it true that you only became interested in football when into your 20's? How old are you now?

Saiful Islam said...

How do you know the glazers won't take any of the free cash flow? They will pocket any profit, and keep the club in debt for as long as they see fit. For example, the IPO last summer could have halved the clubs debt, yet the glazers took a substantial amount of profit. Man utd are chained to debt, and believe you me, we will be stuck with this no matter how much profit we make, the glazers will siphone away anything

Anonymous said...

Sorry for my not so great English, it is not my first language but I would like to disagree with your "they got lucky" statement.

Commercial offices in London, Hong Kong and soon in the States. Remember with the old model there were no significant commercial growth. Sponsors per industry, sponsors per country. Worldwide telecommunications partners etc. Same thing with United branded credit cards. Pioneer deals like the training kit business, world record shirt sponsor etc. Ability to get sponsorship money in advance. (Aon, Chevrolet) There is a reason why they bought back the rights from DHL and the new Nike deal will be pretty great too.

Debt refinance stuff: Bond Issue 2010
The analysts: "Bad, who would buy it? It's toxic." (And I remember the crazy articles from the media after every annual report. The headlines were "84 millions loss at United, oh no everybody panic!" Whitout the explanation what the non-cash items such as the goodwill amortisation are. Or the unrealised fx losses.)
The reality: 2x subscripton and the Glazers did not touched the 95 millions dividend, didn't changed the stadiums name.
Wall Street IPO 2012
The analysts: Same shit like the price is too high, 5-10 dollars would be fair and there is no benefit for the club. The media created a witch hunt with the proposed share option. It is sad when a man like Fergie has to comment publicly that he will not have any personal gain from the IPO.
The reality: The share price is OK. Ask Soros or Blackrock Investments, there is even significant growth since the Q1 report and since the new sponsors. After IPO: Smaller debt, smaller interests. And the share option for the employees is a good thing, more cash remains at the club.

I know how ridiculous is when Woodward/Arnold/Gill says 'welcome our new official toilett paper partner in China' and clearly the 659 million followers/fans data is pure marketing bullshit, but who cares when it works? The model just works. They went to General Motors 'look you can spend your advert budget on one-off events like the Super Bowl or you can be our shirt sponsor. The Super Bowl is just for the USA. For the rest of the world is nothing more thab Beyonce's ass. But United is global. Do you want to sell many cars in Asia?'

As for the LBO we all know what is. We can say all the time how much money was wasted for the privilage to be owned by the Glazers. It is true. But we can't do anything after the events. The takeover was done. Where were the Red Knights 10-15 years ago? The window were open for more than a DECADE to build up a blocking stock. To qoute my favourite spanish comedian "that is a fachht"!

Btw I do not believe in the multi-ownership model. See Arsenal. Kroenke and Usmanov are virtually enemies, the United way is more efficient in my opinion. Of course everybody can thank Fergie what he does is amazing. And I delighted with the transfer policy, there is a good mixture of everything. Experienced players like Ferdinand, Carrick and young, homegrown players like Evans, Welbeck, Cleverley and good foreigners like Evra and Rafael. Fergie spent the second highest ammount on a goalkeeper, RVP is a present star and Kagawa a future one. I don't care much about the City and Chelsea transfers. Did any other club won the PL 3 times in a row?

I like your blog and twitter (congrats to your new son) but I was always sceptical with all this doomsday Leeds scenario. This business success is not just luck. Genius of Fergie and the know-how of the management. To qoute Joel Glazer from 2005: "I caution people that this is a marathon and not a sprint. Judge us over the long haul."

Again I apologies for any grammar mistake.

Mats said...

I think your estimate of this year's commercial income is a bit low. Guess we'll know a bit more next week.

Anonymous said...

The cost of a season ticket in some areas of the ground doubling in 10 years. Some friends of mine great matchgoimg reds for years now can't afford to go anymore. That's the TRUE cost of the Glazers' ownership, never mind all this bullshit about 'growing the brand'.

LUHG.

Simon, East Manchester said...

They won in 2005 when only a few people like myself boycotted and have never returned since. With some justification too as Old Trafford like an expensive morgue now full of middle class tourists that have displaced fans who used to go week in/week out for decades. I saw the FA Cup game the other week v West Ham on TV and the atmosphere was dreadful, the football not much better. Paying over £30 for that? No thanks.

This will be my final post on here as there's no reason for me to visit anymore. The tone of this piece sounds to me like Andy has thrown in the towel as well. GCHQ and people like him...I hope they now have the club they always wanted, it's a vacuous shell in the stands despite the fact the team is still successful on the pitch. Totally devoid of any soul and simply a business now more concerned about multi-million pound sponsorship and how much it can milk out of the folk who attend. It was a good 27 years while it lasted for me but as with the rest of the Premiership, it's overpriced nonsense now. I'm not alone in thinking this but I do have an alternative thankfully.

Good luck to all those who carry on with it.

Anonymous said...

While there may not be much news since the IPO , I will always read this blog . Yes , the IPO news up to now has "covered" the debt , as well as the various commercial deals. The irony is that the previous Bond arrangement allowed for a degree of transparency in the club finances.With most of Uniteds financial dealings concealed in the Cayman Islands ,and requiring only minimal public disclosure ,I would not be surprised if , in this current economic climate , we hear of something more catastrophic just down the road... Chris NZ

Jonny T said...

I know a fair few who walked when you did and I can understand the reasons.

In the stands the gradual drop in atmosphere is as much cultural as demographic or anything else - it started a long time ago, before the Glazers. It happened everywhere in the UK at least. People, regardless of background, turn up to be entertained and fewer want to partake in the experience more directly. It can still buzz occasionally - losing at home to Spurs was a disappointing result but the crowd really did push the team to almost reel it back in for one of the most thrilling matches at OT this year. It was my daughter's first and will live long in her memory.

On the pitch though I think the quality has gone up significantly in the last few years - great to have so many more competitive matches now! OK maybe with the exception of the defending perhaps...

The real crime is the amount the Glazers have appropriated from us and the consequent ticket price hikes and cup ticket lock ins which need addressing urgently if we're going to reconnect all the supporters and perhaps help with the match atmosphere too. We have to keep trying with that. If German clubs continue to be more successful I think we can point to them as an example of the way to go here (unless they sell out now too!) Of course may have done so for a long time when you think of safe seating.

Great blog Andy.

cheers
Jonny

Gary MacDonald said...

An absolutely awesome read buddy. Thank you for the time you took to even think about this, never mind writing it down!

You are a class act mate.

LUHG

Anonymous said...

or even safe standing

andersred said...

Thanks for the comments. Nice to know I've got my own thread on Bluevibe, even if they don't know anything about me.

Si (East Manchester). Sorry you won't be commenting on here again. I'm not "giving up", I'm just explaining the financial reality. With the club throwing off cash, there is no financial reason ticket prices couldn't be cut and the stadium enlarged. United remains a football club and there is still much campaigning to do to get English football to reconnect with its core support and make the game affordable.

That fight continues....

anders

Anonymous said...

As this lot of debt gets paid back, surely the response of the Glazers will be to issue a chunk more debt? The cash proceeds of the debt issue will go into their pockets, to represent the multi-year dividend they politically can't pay themselves.

Terry said...

Great read Andy!


"Chevrolet. The new shirt deal adds £11.6m pa for the next two years (on top of what Aon pay) and then a further £11.9m pa (for a total of £43.5m pa) from the 2014/15 season."

Should be "£23.5m pa". :-)

James Crawford said...

Andy,

What do you think about United's decision to buy out Sky's shareholding in MUTV?

I personally think the revenue from this could be as big as the vertical sector commercial partnerships.

I don't think we want to use MUTV to negotiate our own rights (like in Spain) but we can use our own station to leverage places like Indonesia and provide exclusive content to supplement the revenue from collective negotiation.

A mate of mine works at the station and told me many years ago that United were under investing in MUTV because they wanted Sky to sell its stake.

What do think the commercial revenues from MUTV could be?

Cheers Andy.

James

Mats said...

Terry,

the clue is «on top of what Aon pay».

When Chevrolet takes over from Aon, they'll pay what Aon paid, plus another 23.5m pa in total.
Just to do the math:
£11.6+11.9+20=43.5m pa.

Joaquim Da Silva said...

This is the problem about investing in sports teams. If this was any other business - say a movie studio or video game maker (both also in the entertainment business), the Glazers would be lauded as geniuses.

But because the model works completely differently, they are treated as evil men but the likes of the Abu Dhabi and Qatari Royal families are treated like...well, royalty.

Again, not saying that the Glazers have necessarily been good for United but have they been as bad as portrayed in the past?

warringtonred said...

The Glazers must be doing something right, as both AON and DHL wish to carry on being partners in the club after their current tenure expires on the shirts.

Ref the PIK loans, Tariq Panja of Bloomberg stated that around 20% of the PIK loan was bought back for 30% of their value in 2008 as Hedge funds sought some liquidity. It's possible even more was paid down due to the crash.

David said...

well anders you have fought a good fight against these carpet baggers from Florida. There is clear light at the end of the tunnel for the Glazers and with a combination of luck and good management they have won the war. I applaud all the United fans who continue to go to OT, personally I will never set foot in the ground, when the bastards took over a part of me died. History will show Fergie was the trigger stone in the club being sold and apathy from the fans right at the begining enabled the Glazers to cement their hold on the clubacurrye

Anonymous said...

GCHQ 1 - 0 Anders

ian said...

great posts always read . have been too see united a few times . As i live in wales i cant get there often. It is a shame when i read that fans wont go anymore . Im not a huge glazer fan didnt agree with the debt but the glazers have done wonders with the commercial side of the business, and i do think the debt will disappear in a few years evan if we 've wasted millions. keep up the good work Anders

Anonymous said...

I've followed this debate from the very beginning in various places including Redcafe.

I'm almost embarrassed for most of you LUHG morons. Yes, they are owners and will look to profit from the club in the end (no different to any other owners) but their plan and actions during the last 8 years or so have been 100% spot on. There has been some outrageous comments made by lots of people, including Andersred, and lets not forget about the shameful episode on Panorama, where Andersred claimed some kind of intimate knowledge about how the Glazers were to use United money to prop up their other businesses, and that we are doomed.

This and many other conspiracy theories have now been rubbished and any idiot can see that their business plan, which has no doubt been modified along the way due to the international banking situation, has worked very well indeed. The suggestion that this is luck is just sour grapes by those claiming it was going to be different.

Finally, I also hope that the Glazers interact more with the fans and fans' groups in the future, but there has to be fundamental change within those fans groups in order to allow this. The likes of MUST have behaved disgracefully in the past towards the owners and they need to change their tune (perhaps by getting rid of that muppet Drasdo for a start) so that perhaps we can start again working with the owners rather than against them, and hopefully having more of a say in the things which matter to us (ticket prices and such) rather than the all out war we have seen in the last few years.

Anonymous said...

I'm the guy above. Forgot to say excellent work with the figures and analysis - the situation does indeed look to be very positive for us.

Although I have disagreed with you in your analysis in the past, keep up the work - information from both sides of the debate is vital for someone like me in order to make any sort of opinion and you, and the likes of GCHQ, have worked tirelessly in order to provide that.

Anonymous said...

The final act of this sorry saga is yet to be played so the 'wise after the event' people still need to err on the side of caution. Anders has made plenty of forecasts, some good some off the mark, but at least he has given the fans some sort of idea as to what has gone on at the club and, as he also states, without Fergie and the ability to be able to sell the likes of Ronaldo who knows where this club would be.

Just the fact that the red knights existed, along with the many fan protests,alerted the glazers that all were not happy at the club and that has to be good.

Anybody who thinks that the glazers will form any sort of relationship with the fans is living in a dream land, as long as any old visitor is prepared to put money into the coffers the glazers will be happy, when the fortunes of this club take a downturn, as history tells us it eventually will, then we will see the glazers's true colours.

When you see the only clubs comparable to ourselves in size and revenue(Barca and Real)going from strength to strength while the money has flown out of United the job of Fergie takes on even more significance.

The Sports Clash said...

the reds are back again

85truemans said...

And now we see the £10M a year training kit deal with DHL superseded by a £15M a year training complex deal with Aon. That presumably falls into the "Other, less certain, sources of growth" category, where every little helps.

As an aside to that, I wonder if there is a clause in the Aon deal that precludes the sale of the Old Trafford name for the duration of the contract. If I were representing Aon I would have asked for it as the training ground brand will be devalued the moment Stadium is given a commercial name. If, however, I were representing United I would have said a firm 'no'.

Anonymous said...

Fantastic analysis there Anders. Can we put the whole ownership thing to bed now?

I'm no fan of the Glazers but in the end they got it right. Everybody thought they were mad to pay £800m of mostly borrowed money for United and that money from TV deals and commercial revenue had peaked. Only three years ago the Red Knights insisted the club was worth less than £1bn. But right now it's valued at £1.8bn even allowing for the debts.

Maybe it takes a bunch of outsiders to see past the perpetual pessimism that seems to infect all commentators on English football?

The club was never in danger. Whatever had gone wrong financially the best solution for all involved would have been to sell the club as a going concern. That's what we have that Leeds and even Liverpool don't - United are profitable. This is both our curse (people keep buying, selling and generally dicking around with us for their own gain)and our blessing (we can indeed "never die").

Sepak Bola said...

Glory Glory Manchester Untied this Season.....

Matt said...

Thanks for all you've done Anders.

It could so easily have gone differently and while I'm glad it didn't, I do wonder what it is we're supporting these days.

I'll still believe that your influence helped to stop them asset stripping to the extent they would've done otherwise... so thanks again for that and everything else.

Kara Hilbrands said...

Wow! This was a really great analysis of United spending. Learned a lot! Glory Glory Manchester United!

Anonymous said...

I guess we now know the reason for the rushed IPO. And the scant mention of Fergie in the IPO. It raises a few questions though....
Is it a duty of a leading football club with an outstanding manager to inform investors pre ipo that the outstanding manager is set to retire within a year?

The Red Devil said...

Glad it all turned out well in the end.

Now it is time for MUST to disband and perhaps reform under a different guise with a fresh outlook and perhaps a new person at the helm.

Club/fan dialogue needs to be re-established but MUST aren't the body to do it. They burned all their bridges long ago.

There are still aspects of the Glazer regime that are unsatisfactory from the pov of the match-going fan and these perhaps could be addressed with a group speaking on behalf of the fans which the club are actually willing to engage with.

Thank you for all your work over the last few years Anders. I have little doubt that you and others did have an effect overall.

Anonymous said...

@ Anonymous 22.29 2 April ...Your comment about "the final act in this sorry saga" yet to be played out , and note that we will see " the true side of the Glazers" when the clubs fortunes take a downturn rings true . Just like the commentator noted during the 1989 Liverpool -Arsenal title decider , "They think its all over", we should only talk about the debt as being finished when there is indeed official confirmation that it has been paid off . After debt repayment, the vast majority of the finances that the name Manchester United reaps from various sponsors should then be
reinvested properly into the team to buy quality players (domestic and international), plus quality management and coaching staff to take us forward not just domestically but to success in Europe .Another thing :- We do not want to become another Arsenal in which the owners see certain league and cup placings to achieve certain financial targets as being more important than winning trophies , both domestically and in Europe ( in which the latter which would be an insult to the legacy of Sir Matt Busby ). Actually, Raphael Honigstein , the German football writer, on his Twitter account was curious to see what Uniteds current owners thought about winning titles , and also asked if the appointment of our latest manager was the beginning of the Arsenalisation of Manchester United ...

DrFager said...

I agree with the above post, "It's Not Over Until Its Over".

When the debt is entirely eliminated, while the team is still competitive, then and only then is this over. (Or could be viewed as a "win" for the Glazers)

With Fergie, lagging behind other clubs in spending power could be overcame. Without the old man leading the charge, I suspect at some point having only the 3rd or 4th most amount of money available for transfers (annually)could catch up to us. (Despite being the fiscal king of the league)

And this is all overlooking the fact that the Glazers will sell the club once the debt is eliminated, and they have siphoned off as much money as possible in the process. So a best case scenario for this ordeal is we remain competitive while they strip the club of 1b, and then they sell for massive profit, potentially putting us right back in the same situation. (WHOS TO SAY THE NEXT OWNER WILL BE ANY BETTER?)

Wait until the next owner leverages 2b against the club!!!

Paul said...

And new articles soon Anders? They are a great read

Benny Hakeem said...

You forgot to factor in the (on top of what AON pay) part.

Yalang Renghold said...

Now such a good football club are liabilities. How is this possible. Their annual football shirts are a great many benefits.

Low APR cards said...

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Anonymous said...

Who is that GCHQ moron who loves the Glazers? Apart from United being lucky these leeches have capped us from spending more per season on big players (players who could've done more to help us been more successful in Europe instead of losing out twice to Barcelona due to lack of quality signings) - United were spending roughly same amount 10 years ago on good players (£27mill each on likes of Rio & Rooney) and now we sign players for roughly same amounts who are reaching their 30's (like Van Persie and in past Berbatov). Glazers pfffttt!!!!

Tamara said...

To be honest i can never see MU without debt, i don't know way but they simply work like that. This maybe is not very big problem until they have money to pay them.

Anonymous said...

Anders old chap. Do these figures need another Daisy Nook? Just wondering how a year out of the C/L might affect United's figures plus the potential second year if they only qualified for the Europa League.

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