Delaney is not particularly reliable but the article states that they're the two favourites if the Glazer's go down the route of minority investment rather than the favourite options overall. The article does also say the possibility of the Glazer's staying on has grown in credence in recent weeks (although it doesn't explain why this is the case).
Club Sale | It’s done!
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He doesn’t explain it because he’s made it up
Whether the fans will "allow" this is completely irrelevant. Just as how the fans didn't allow the club to be drained for 17 years.
Despite all the "expert" financial analyses done in this thread and the supposed infeasibility of the Glazers staying in any capacity, I remain 100% convinced it's going to be Elliot or Carlyle. They will find a way. And nothing anyone can do to stop that from happening.
I've made peace with the fact that there isn't a satisfying ending here for me.
I’ll give you the bite
And ask you what I’ve asked everyone else who thinks it’ll be minority investment, and nobody has yet had an answer to,
Why would they go down that route rather than a world record sale now? How does that benefit them more? And how do you think it would work? After they do the minority deal, then what? What happens to capital investment?
But if you’re going to say what Harry said and try to tell me that the Glazers love the club, don’t bother
Truly astonishing stuff that Delaney knew feck all about these lads bidding hours ago yet has since managed to find out they’re favourites - something not even Sky who broke the story knew. What a phenomenal journalist he is.
Delaney is just the worst. Journalist and person.
Could someone explain to me how minority investment would effect things on the pitch? Would we be able to raise more than we currently can to spend on the team and infrastructure? Obviously an outright sale would be better, but would minority investment be better than nothing, more of the same or even make things worse?
David Rubenstein, Co-Founder and Co-Chairman of Carlyle, is a good friend of Jassim's father.
I just can't see how minority investment works. Presumably the Glazers that want to sell their shares are going to take their money and run. So it doesn't give us any extra funds, avi and Joel and providing extra funds or paying off our debt, so no extra money that way. So we'd be relying on someone making a minority investment, while the Glazers retain the class B shares and thus effective control of the club, but we'd be needing these minority investors to provide extra funds for the club?
I never said the Glazers love us. I said Joel and Avram are known to have a strong affinity towards the club and it's something that shouldn't be disregarded when it comes to minority investment vs a full sale.
They might think there's still good potential for long term growth.
It’s because it doesn’t work
It would be an option if the current owner was someone who loved the club and wanted to see it grow, and was willing to lose money to do so.
It astounds me how many people on here and online still don’t realise that the Glazers only care about money and don’t give a shit about the club
they go to about one game every two years
for a sports team they own
they couldn't give a feck about us
So they’ll turn down £5-6billion now, let the stadium, facilities, debts and playing squad deteriorate, so that not only will the next bidders have to invest more into the club (which will make their bids lower), Glazers will also get a smaller slice of that sale
The Glazers are all about money, that’s the beginning and end for them, so I don’t see why they’d risk that. They’d basically be relying on Ten Hag getting top 4 every season on shit loan signings against at least 3 teams with unlimited funds. Ridiculous risk
The involvement of hedge funds would suggest that some pretty keen business minds see potential for growth.
The whole point of the sale right now is that massive infrastructure spending is required, we have a ton of debt that is impacting on our ability to spend on the team, and we still have a number of glaring holes in our first 11 and squad that will likely require 400m plus over two summers to fully plug. How does the other Glazers selling their shares and Joel and avi staying help with any of that? Unless you think the other Glazers are going to charitably use the proceeds of the sale to invest in a club that they no longer have any ownership of?
Simon Stone reporting that a third US private equity firm - Ares Management - are now in the running too.
https://www.bbc.com/sport/football/65285468
https://www.bbc.com/sport/football/65285468
I find it incredible after 1037 pages that anyone thinks that Glaziers love this club. " Oh but they bought players" thats basically like paying the electric and council tax bills on the empty property on interest only loan on Kensington Palace Gardens, doing the least they have to to keep the boat afloat. Glaziers love $$$$$$$$ nothing more nothing less anyone who thinks anything else is deluded. At this rate I would call on Qatar and SJR to do everything to rid us once an for all of these parasites ( glaziers and any other hedge fund).
Why?
They’d still be circling if they knew it would never get over £5bn. Their ultimate aim would likely be to wrestle control from the Glazers and then sell up.
If we start with the premise that none of the Glazers like football or care about being owners of a football club and they are only in this for the money (a pretty fair assumption), then the only reason they would want to stick around would be because they think the club will be worth more in the years to come, than it is now and therefore they hang on for a bigger payday further down the road (while taking a chunk of money for the stadium/themselves from a minority investor in the interim).
They have not invested in infrastructure for 15 years and yet they have seen the value of the club rise by c. 800% in that time. If they go for minority investment, they presumably believe that they can continue to pull off the same trick for a while longer.
We don't know whether minority investment would mean some of the Glazers cashing in their chips and walking away (in which case they keep the money) or a share issue (in which case the club keeps the money) or some combination of the two. It is therefore pretty difficult to know at this point whether or not there is any upside for the club from Elliott/Carlyle coming in.
Yeah, that is a tricky one alright, will the Glazers sell their shares and benefit personally to the tune of billions of pounds, or issue new shares and dilute their stake so that the club can benefit, its hard to say which is more likely, if only we could look at the past actions of the Glazers to see whether they'd be greedy cnuts or benevolent owners
The difficulty will be finding a buyer who is willing to invest a big chunk of money with ALL of the money simply going to line the Glazers' pockets. If you're coming in as a minority interest, you're going to want either an exit strategy or a clear path to full ownership - that means that the Glazers will likely have to give something up if they want to stick around (some control or some equity or both). If they aren't prepared to give up either of those things, then minority investment doesn't work (unless you can find a very stupid investor who is happy to entrust their money to the Glazers' dubious business acumen).
HBJ and family have also invested with Carlyle previously.
You think Jassim and Carlyle are tabling a joint bid?
No idea whatsoever. However, HBJ and Carlyle have done business before. And Rubenstein is a good friend of HBJ (Jassim's dad).
Well, yes exactly, that's why I don't believe a minority investment is going to happen, theres no way for it to happen and benefit the Glazers as much as a full sale does
While I don't think so, it's entirely possible that jassim buys the Glazers shares and has partners buy the remainder of the publicly traded shares, which I think would allow Qatar to take us private but without the additional investment needed to buy up the remaining 31%
Let’s clear up some confusions.
There’re are six siblings owning 69% of total 100% MUFC shares. The remaining 31% is listed at the NYSE.
The siblings owns roughly shares between 13-19% each and when they sell the winning bidder has to do either one single purchase only, probably thru the Raine group who then distributes the money between the siblings. The other option is that the winning bidder do six separate deals with the siblings or depending how many of the siblings who sell a separate deal to each of the them.
These deals has no financial connection to each other as far as we know other than they probably use the Raine group to take care of the selling process. That means that any new owner has to finance the buying either thru their own money or a loan that is connected to the buyer alone.
With public access to the latest Q2 and annual report we know that MUFC can’t afford to much dividends or further loans. In fact the opposite that new or old owners has to significantly reduce the clubs principal debts, paying outstanding contract liabilities and not take out any new dividends. Otherwise the club is in danger to bankruptcy.
What is the financial upside for those siblings who remain as owners?
Why would the selling siblings accept anything less than full value of their shares? The new owners will never accept a deal without financial benefits who gives them total ROI and with that comes demands and assurance who and how the club will be run witch means that remaining siblings will lose control of the club.
No businessman with sense accepts such conditions when so much money is involved. This is the reason that a part sale makes no sense.
There’re are six siblings owning 69% of total 100% MUFC shares. The remaining 31% is listed at the NYSE.
The siblings owns roughly shares between 13-19% each and when they sell the winning bidder has to do either one single purchase only, probably thru the Raine group who then distributes the money between the siblings. The other option is that the winning bidder do six separate deals with the siblings or depending how many of the siblings who sell a separate deal to each of the them.
These deals has no financial connection to each other as far as we know other than they probably use the Raine group to take care of the selling process. That means that any new owner has to finance the buying either thru their own money or a loan that is connected to the buyer alone.
With public access to the latest Q2 and annual report we know that MUFC can’t afford to much dividends or further loans. In fact the opposite that new or old owners has to significantly reduce the clubs principal debts, paying outstanding contract liabilities and not take out any new dividends. Otherwise the club is in danger to bankruptcy.
What is the financial upside for those siblings who remain as owners?
Why would the selling siblings accept anything less than full value of their shares? The new owners will never accept a deal without financial benefits who gives them total ROI and with that comes demands and assurance who and how the club will be run witch means that remaining siblings will lose control of the club.
No businessman with sense accepts such conditions when so much money is involved. This is the reason that a part sale makes no sense.
No. He's a serial fabricator who belongs at a scummy tabloid like The Daily Star. It's a total mystery why he remains employed at The Independent.
The Glazers are such unbelievable wankers.You know they’ll find some way to either 1. sell Utd to some crap U.S mates of theirs. 2. Stay.
Both of these will piss off Qatar who’ll then buy Liverpool and dominate Utd for decades to come.
Maybe as a gross, nominal value it's close to that, but as real value for the owner the number is close to 250-300%. At least if you discount the debt (1 billion that doesn't go to Glazers pockets) and consider 17-18 years of 2-3% inflation rate. Plus you'd probably have to consider the capital gains tax (about 20%) to dillute the Glazers income. So still a very good deal for all that is worth (buy, invest very little for a long time, reward yourself with above market yearly dividends and leave receiving 2.5-3 times what you put in) , just not ridiculously good as 800% would be.
Thinking a potential better sale price in the future, they would have to consider:
A) The debt is increasing.
B) The inflation rate is higher, and therefore also the interest rates on the debt.
C) There's not a lot of room for more dividends.
So, the new better offer would have to overcome all of these variables getting worse.
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I don't know if someone else made that point but the fact that there are other unnamed bidders has been known from the beginning. They are/were just unnamed, they didn't magically appear this week, these aren't late developments or anything like that. Some papers seem to want to create news with old informations or half truth.
Yes of course. The main point is that, in spite of all of the Glazers' mismanagement, the value of the club has risen steeply during their ownership. They may well be acting under the impression that this trend will continue and that, even with very little investment, the club will be worth even more in 3-5 years. I think that they would probably be wrong about that, but it doesn't much matter what any of us think.
It makes sense what you write about the Glazers distinct lack of love for the beautiful game however with interest rates about to spiral and the debt at nearly £1bn, the hedge fund who decides to buys a minority stake with venture capitalist money would demand a significant board presence and have a say in day to day financial runnings.
Let’s play devils advocate and say it happens, If they are buying 20% voting share rights for let’s say 1/5th of the value demanded for voting shares so they want £6bn and will collectively relinquish 20% of voting and shares now giving them a 49.5% stake while the new VC own 20% at £1.2bn.
The VC investing, will have a 7 year plan to get a ROI of at least 20% back on £1.2bn invested so will want £1.5bn back when the club sells for say hypothetically £8bn in 2030.
Here is the realistic obstacles ;
1. The servicing of the debt currently at £600m (forget amortised Transfer debt that’s a completely different line ) currently £20.5m per year and about to rise very quickly. It makes sense that VC will have Accountants and IT number crunchers all over the business, trust me when our £250m per year company was bought by Sun life, we had a meeting every day, just to do forecasts and financial projections. The first thing they will do is try and manage and renegotiate the debt, pay off half so they can apply a 7 year forecast through club projection software program, incorporating p and l to pay off the other half of £300m.
That means the club would need to make a profit of £45m per year that could not be used in buying new players or paying dividends but instead pay off the debt, so they can reduce the liability of the business and be part of a sale which would be ultimately debt free. The interest payment would still be £10m per year to service the debt and now after these decisions, there would only be £900m left of £1.2bn invested for a minority stake.
2. Squad improvements, contrary to popular belief who ever buys us with FSP coming into play we still have to sell to buy, however after the club pays their credit card bill of £200m off, let’s say some of that is revenue generated but £100m is still needed from VC investment, which now decreased to £800m
3. We then go buy Harry Kane, which is £100m upfront no payment plan but the club can amortise the figure over 4 years in their accounts and we agree to another £200m in player transfers, the Glazers will throw the book at transfers just to keep the fans from burning the place down, we will amortise the other signings and offset then against player sales however we might have to pay £40-50m in back payments from the £300m we owe to other clubs, just to keep Uefa off our back. The £800m is now down to £600m.
4. Training Ground upgrade at Carrington , they might spend and build a cheap 7,500-10,000 stadium for women and youth but that’s now highly unlikely as there is not much growth in revenue from this area of the club in their bigoted opinion so they maybe just spend £50m to keep ETH happy and put some modern recovery pods in training complex, rather than £250m Qatar would spend, Capital now reduces to £550m
5. We know already that Glazers and Elliot’s were looking at one stand extension and a cheap stadium refurb, a big screen etc which was recently quoted at £280m so a cheap refurb probably to start next season 23/24 and be completed 24/25 season, all parties would want this as that gives the club an extra 14,000 Season tickets and increase revenue, however no guarantee the roof or the toilets are fixed, who cares the Glazers won’t be turning up anytime soon!
This leave the club with cash funds of probably £250-270m in the bank as working capital however, part of the deal agreed by VC would be no dividend payments unless the club made in excess of £75m of profit one season and all parties must work towards new marketing deals and increasing Turnover, Revenue and Net profit. If the club can reduce the debt quicker, all parties must agree and no dividends can be paid out.
This new partnership would need CL football every season, they would have to win a couple of PL or a CL in the next 7 years and hope that PL clubs can soon stream their own games at 3pm on Saturday for this to work. The club turnover would have to increase to £800m by 2025/26 and at least another £100m of the debt paid off so the club had now reduced debt to £200m.
I can see the appeal because Avram and Joel think they can carry on as usual with someone else’s money because they own the Crown Jewels of soccer clubs, just because their Daddy Malcolm willed it to them!
They are living in dreamland to think that any Venture Capitalists won’t be watching their every decision, sabotaging and contradicting their every move waiting to pounce and show them how a real business vulture or shark acts. I don’t believe the Glazers are that stupid however if they are, you know what, more and more I’m warming to it, because it only ends up one way, them bankrupt and the VC buying the club for peanuts, then selling it to the Arabs in 3 or 4 years for £5-6bn which they could have got this year !
However I suspect it’s more deliberate leaks to the media in order to get a certain SJ to bid £6bn and then it’s over, either way I don’t care anymore and nor should you, as long as we support the team, the manager and we finish the season strongly that’s the most important thing right now not this sideshow that endorsed by the worst owners in football history !
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Is estate tax playing a part here too? Was a factor in Broncos sale.
I keep saying this - we will never truly compete for the league with the Glazers in charge. The surest way to get them out is a catastrophic collapse of form between now and the end of the season.
The increased value of pretty much all top level sports entities is based on the global development of sports entertainment, the globalization of broadcasting, gambling and the larger visibility afforded to brands through advertisement. It's not about specific owners quality and it's not limited to a single sport/league. Whether United will be more valuable in the next 10 years isn't really about the club itself but the entire eco-system.
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