[Archived] Glazer Set For Utd

[philipl]

The Independent have gone to the lawyers and exercised the right to see the details of Glazer's financing.

This is so spectacularly bad that the replacement finance must already be in place.

My guess is the type of long term- 25 years, insurance backed triple A, triple A paper that Arsenal are using for Ash burton Grove must be planned. NM Rothschild are both Arsenal's and Glazer's advisers.

However, Glazer has to wait until the early repayment penalties are out of the way and has some complicated refinancing to do of the bridging loan and other debt.

My guess is he is somewhat vulnerable to the fans making association with Man U a hazardous activity and very vulnerable if Man U continue their relative decline on the football pitch.

I suspect we will see his assault on football's structures sooner rather than later.

[Anti Euro Smiths Fan]

Link: Nike threatens to cancel United sponsorship

[philipl]

The important paragraph in that article is:

Ian Todd, the vice-president of sports marketing for Nike, who signed the 2000 deal with Peter Kenyon, the then chief executive of Man Utd, told The Sunday Telegraph: "We don't know what is going to happen next year. All options are open."

No doubt one option has been offered from Stamford Bridge.

[SIMON GARNERS 194]

As much as I dislike Utd,for one selfish person to be allowed to disrupt a club and plunge it into so much debt,uncertianty and upheaval is truely appalling.Glazer has no interest in football,never has and never will.

MONEY

[American]

Actually, I thought the most important paragraph was:

It has also emerged that Man Utd's financial advisers, including JP Morgan Cazenove, failed to secure promises from Glazer about his plans for transfer budgets, debt levels, team selection or ticket prices during the takeover discussions with the US sports tycoon.

Completely contradicting the "limits" you claim were made.

As for him being in it for the money, lots of owners are in it for the money.

(And has anyone else made the connection with the amount paid for United vs. the amount Roman has "wasted" on Chelsea? Makes his 500 million or so (I'm sure I'll be corrected) invested to date seem like a bargain.)

[philipl]

American, are you wilfully misunderstanding? Completely contradicts WHAT exactly?

The old Man U Board sought legally binding commitments as to the conduct of the company under Glazer- these included the MINIMUM amount of transfer funds Glazer would make available. Glazer refused to say anything and the Board duly reported that fact in its 18 page analysis of the Glazer offer.

The Independent Newspaper has now exercised the right to examine the documents lodged at Glazer's lawyers relating to the takeover of a London Stock Exchange listed PLC- Manchester United. The covenants signed by Glazer for the £275m of preference shares subscribed by the American Hedge funds sets a MAXIMUM amount for transfer fees of £60m over four years (£26m then progressively reducing in any one year) beyond which Glazer is in breech. He has NOT covenanted to pay so much as a minimum of one penny in transfer fees. He HAS covenanted to pay a smaller maximum number (£60m over four years) than the famous £20m a year for five years he talked about when he was trying to persuade the shareholders to sell Man U to him.

The difference between American sport and European sport is that American owners are largely in it for the money and European owners are not. In the UK, the ONLY people making money out of ownership rights were in fact Manchester United shareholders receiving a dividend and then a capital killing out of Glazer assuming they didn't buy following the Manc treble and at the peak of the stock market bubble (1999).

Abramovich has a huge capital gain on paper from Chelsea- he invested £150m to acquire ownership and clear the debts and about another £250m in transfers and operating losses. He probably has an asset in Chelsea worth about the same as Glazer paid for Man U- around £800m but the massive difference is Abramovich is underpinned by the 11 acres of Stamford Bridge in West London being worth £275m whereas 8 acres of Old Trafford in run down West Manchester are probably only worth £20m.

[blue phil]

A very interesting article appeared in yesterday's Daily Mail (which I can't locate online ) describing the links between Glazer and a certain Sheldon Adelson , who may be more familiar to the Yanks as a multi billionaire Casino tycoon . The latter is said to be worth £8 billion .

The article explains how Adelson , backed by the local council and the club directors , plans to build a hotel and casino complex on ground owned by the club right next to the ground at Salford Quays. Such a venture , which the relaxed gaming laws in GB presumably would not prevent , may be up and running as early as 2008 . If successful the business would accrue profits that would make the football club nearby seem small fry .

A lot , of course , is speculation , in particular the exact relationship between Glazer and Adelson . It is not unreasonable , though , to suspect that a deal has been made between the two - an obvious explanation as to why Glazer would burden himself with so much debt on such a risky enterprise as a football club .

The long term danger to Man Utd is obvious if looked at from the point of view that it is not so much the club that the money men are interested in as the casino/hotel business that will eventually be placed alongside it . If tens or hundreds of millions are coming in from the latter then the former will soon be regarded as a nuisance - especially if the RFW keeps turning up with requests for a chunk of the profits for players who will only help the football club to make relatively miniscule profits .

[USRoverME]

Those pesky NFL Rules prevent owners like Glazier to have any official dealings with a gambling enterprise, also make this relationship dangerous for Glazier. i.e.- he might have to hand over ownership of the Bucs or ManU and can't be involved with both...

[philipl]

Sky Sports have reported that Glazer will have to find £61m in interest and fees payments per year. Glazer has therefore borrowed an additional £109m in working capital to fund those service payments.

The bank borrowings he has taken on will end up costing more than double the amount loaned if he repays them at the end of their term.

Of course Glazer must have some formula for re-financing this lot but with the huge penalty payment for paying off the hedge funds in the first two years, he is sqeezed in the short term. The size of the numbers involved probably means he will struggle to keep his re-financing secret with a determined and sophisticated group of people like Shareholders United watching his every move- I doubt Glazer had bargained on being laid naked the way every aspect of his business and personal life is now going to be exposed in the British press.

This gives the football world and teams coming up against him in the transfer market something of an advantage:

Should Glazer go to Court about the Premiership TV Rights agreements being anti-competitive, the Premier League could find that legitimate delaying tactics might be every bit as effective as actually getting a ruling against Glazer- particularly if they can avoid an expedited trial.

Were Chelsea and Man U go for the same £20m rated transfer target, Chelsea would know that Man U would have an upper price limit they could not go beyond without selling a player or getting a legal waiver of covenant agreed, paid for and signed with the Hedge Funds.

So the sudden move Ferguson made to sign Rooney when Newcastle made an offer for him last summer would not have been possible this summer.

An interesting American article here observing that European commercial exploitation of sports is in many ways ahead of American practise. It points out that yields from American sports TV advertising rights have probably peaked with the availability of recorders which screen out the adverts. Sports fans can reduce three hours of gridiron to ninety minutes on the replay (and no doubt find it a much more satisfying experience).

Edited May 29, 2005 by philipl

[Parasyte]

Interesting read... I dont watch any US sports, and the idea of no bilboards or whatever seems a strange move. The NFL, etc, must have a helluva stranglehold on these sports.

[pg]

So if ManU somehow manage to miss out on the Champs League this season... does this mean that they are screwed?!?!

[philipl]

Two interesting transfer snippets on the Mancs this morning- Glazer has ordered Ferdinand be sold if he doesn't sign his £100K per week contract.

On the basis that an unhappy Ferdinand can probably only go to three or four clubs in the world who could beat that sort of weekly wage, I suspect he will leave for a relatively nominal transfer fee (or the Glazers will face a Bosman).

The other is that van Nistelrooyd has been offered to Barca in a part swap deal for Etoo. It would seem the RFW has fallen out with RvN permanently- a bit like the Staam bust up which effectively scuppered the Manc back line.

The scenario is unfurling nicely- the Mancs unsettle Etoo, Chelsea step in and buy him, RvN's value goes down because it is known he is for sale and RFW wants rid.

[RevidgeBlue]

There were a couple of interesting Scum stories in the press yesterday.

Firstly it was reported that a condition of Glazer borrowing so much money was that he had to undertake to cap spending on players to around £25m p.a. until 2014. That may not buy very much by then.

Secondly Nike were making noises about possibly taking their option to exit their £300m 13 year sponsorship deal in 2008. A spokesman commented that with Chelski champions, Arse winning the Cup, and Liverpool the Champions League it could be argued ManUre were only the 4th best side in the country.

Things seem to be unravelling nicely.

[bellamy11]

Apologies if this has already been posted:

Official page of the Manchester Buccaneers

[coffeeman]

Apologies if this has already been posted:

Official page of the Manchester Buccaneers

320085[/snapback]

Pure class!

Can't believe the mancs taking it seriously

[American]

That's one of the funniest things I've ever read. Gotta love the uppity ManUSA fans reactions, too.

[pg]

Cheers for the link Bellamy!!

[broadsword]

Just been peeing my pants over that one.

There's so many thickos in this country it ain't true!

[bellamy11]

It really is superb. He's added his list of EPL teams now. We're listed as:

Blackburn Pyros

Northern prison side

[modes98]

ah love it! Proper quality!

[philipl]

That is just a brilliant web-site!

The scrap over football's future initiated by Glazer is getting closer. Taken from World Soccer News:

The SU spokesman said: "Glazer's business plan projects EBITDA (operating profits) in the year to July 31 2006 of 57.1 million pounds (103 million dollars) and in the next year July 31 2007 of 89.1 million pounds (161 million dollars).

"Where can he find another 32 million pounds (58 million dollars) of operating profit in one year's trading?

Manchester United supporters are taking legal advice over a possible challenge to Malcolm Glazer's bid to take the club into private ownership. I very much doubt the supporters would succeed but they might assemble enough of a legal argument to delay Glazer- having bought 76% of Man U, Glazer is cash out to the tune of £600m already and time is money as they say...

Putting things into context, there are only 18 clubs in the world with turnover (total sales income) of more than the £57m - the amount of operating profit (up a cool 125% over Man U's current profitability) Man U are projected to make by Glazer in the year beginning just 26 days from now.

Glazer has to do that in the context of being friendless in his customer base with a large vocal and highly influential minority hell bent on stopping him.

Undoubtedly Glazer has a very good anti-PR firm working for him the way that news about Man U has been killed in the media. It is significant that the most commercially- managed voice in soccer, David Beckham, is the only one which has said anything vaguely positive about Glazer.

I still have not seen anything that convinces me that Glazer will be in anything but deep trouble with this gamble.

Edited June 4, 2005 by philipl

[cn174]

Well Glazer's sons are just about to join the board as Roy Gardner and two others have stepped down.

http://news.bbc.co.uk/1/hi/business/4617585.stm

Meanwhile Man U move for Ji-Sung Park. http://news.bbc.co.uk/sport1/hi/football/t...utd/4616589.stm

Nothing to do with wanting to increase merchandise revenue in another country I dont expect

Edited June 7, 2005 by cn174

[Korean John]

Well Glazer's sons are just about to join the board as Roy Gardner and two others have stepped down.

http://news.bbc.co.uk/1/hi/business/4617585.stm

Meanwhile Man U move for Ji-Sung Park. http://news.bbc.co.uk/sport1/hi/football/t...utd/4616589.stm

Nothing to do with wanting to increase merchandise revenue in another country I dont expect 

321734[/snapback]

That's patronising (at best) and shows your ignorance of the facts. Park Ji-sung is South Korea's best player and recognised by most as PSV's best player. He ran the game against Milan in the Champions League semi-final.

Not all Asian players are coveted because they represent merchandising opportunities. Park is probably the best Asian player right now and we'd be lucky to have him at Ewood.

I'm not sure Man U is the best move for him but if he shines for the Champions League Semi-finalists then why isn't he good enough for a team that only reached the last 16.

[Parasyte]

Of course Man Utd are buying him because he's a good player, but I'm sure the incentive of increasing profit in Asia is one reason why they are going for him instead of another defender. I would.

[Korean John]

Of course Man Utd are buying him because he's a good player, but I'm sure the incentive of increasing profit in Asia is one reason why they are going for him instead of another defender. I would.

321833[/snapback]

He's not a defender. He plays in midfield.

Why is it that anybody in England thinks that an Asian player has to be bought to sell t-shirts?

What profit will it increase in Asia? China or Japan have no interest in Park. In will please the South Koreans but will not make Man U much money in merchandising.