Which imo is why they are selling. Esp with rising costs of borrowing capital.
Club Sale | It’s done!
- Thread starter JB08
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Feed the glazers, let them know it's Christmas time
The Glazers selling is the best proof you could ask for that the club is not destined to remain a money making proposition without big investment. If it were they would be keeping it.
Given that, and given they won't sell cheap, I don't see anybody but an Arab sports washing human rights abuse operation taking charge like at PSG, Newcastle and City.
Normally on these topics I am the type who convinces myself that it "must" be a specific suitor. Like in January, we just "must" get this or that player, makes too much sense not to. Etc etc etc. But on this one I am struggling to come up with any meaningful guess.
Normally the one walking out on top of an auction process is the one that can produce a calculation/business plan supporting the highest purchase price.
The Glazers want to "exit" their investment in Man Utd. Normally you have three "exit" options, (a) an IPO (you sell the shares to the share market), (b) Private Equity buyer (a buyer with money that isn't coming from the stock market), or (c) industrial buyers (Comcast buying Sky is a classic industrial buyer, you do it because it makes sense to combine two businesses, can further be divided into vertical/horizontal buyers, i.e. if you buy a competitor its horizontal and vertical if you there is some kind of supplier relationship).
These things really go in trends. Sometimes the stock market wins most "auctions", during other market climates the PE buyers dominates. Honestly, if this sale was made like early 2021, a SPAC raising 8bn and buying us could have been possible.
Would we be a good investment? Depends on what we mean with good. The Glazers would have made a heck of a lot more money had they bought shares in Facebook, Amazon, Netflix and Google 17 years ago than this football club. But if you buy this club for 6bn and invest 3bn in it, say 1.5bn in infrastructure and 1.5bn in the squad (150m per for 10 years) -- we would (should) establish ourselves again as a top 3 club in the football world. The other two, Real and Barca (as well as Bayern) can't be bought. Can you make money by just expecting a higher sales price in 10 to 15 years? Could we get 15bn in 2032? If so, it is a 5 percent return on the investment.
Is that enough? Nah. There need to be additional benefits.
Who would get those benefits? The thing is, with our brand, I think there are material additional benefits for any buyer. Compare owning Manchester United vs the Power Grid in Florida. If you are say the Apollo Investment Group, if the return is the same, if they buy us they improve their own brand, open doors, get in connection with people they otherwise might not get in connection with otherwise and so forth. If they don't want attention, you buy the power grid or finance a railway against a slice of tickets sales for 50 years or whatever.
Who is buying us? With this line of thinking -- the buyer would be the ones that get the biggest additional benefits of a purchase. Be it synergies, reputional types or whatever.
If we look at the industrial buyers, Comcast should be mentioned, the streaming services (Apple, Amazon, Netflix, Facebook and co.). Dolan/MSG?. The Chinese giants, Tencent, Alibaba and co. For some it could of course be a mix of a strategic investment and industrial upsides.
Does it make sense for Apple to buy us? They (a) got the cash at hand, (b) if they sell us in 10 years it very likely is with a profit, and (c) surely there would be some synergies with MUTV on Apple+, inside access to the players and coach, etc, and what not? Nope, as things stands right now, it does not make sense. Apple has a profit margin of 25.31%. On a 9bn investment, they need like increased profits of 1.5bn per year to get that margin on the investment. That would mean that we like have to bring 30 million subscribers to them -- which wouldn't happen. The same applies to more or less every other industrial buyer.
SKY, now a part of Comcast, tried to buy us in the past, but got mixed signals from the UK regulators and cancelled their plans. Haven't things changed a lot since though? Is "The Big Picture" complexly dead? Probably.
I would not rule out the industrial buyer, because in short its an ever changing landscape and just because something doesn't add up today, it doesn't mean that it won't add up tomorrow. But -- it will take them seeing something we aren't seeing.
If we look at the PE investors, we have (a) the wealthy individuals, (b) the directly and indirectly state connected funds (Abu Dhabi, Dubai, Saudi, Bahrein, Norway, Kuwait, Qatar and co) and (c) mainly US investors (like the mentioned Apollo Investment Group, Harris Blitzer Sports & Entertainment, consortium's around sports investors/pro team owners like Steve Ballmer, Stephen Pagliuca and the likes).
For which of these type of buyer does it make most sense, who gets the most additional benefits etc? Who has a lot of money right now? Strong currencty?
Looking at the large sample of recent transactions transactions that we have to look at -- 100% it makes the most sense for the state oil fund money.
The oil state funds won the auctions for City, Newcastle and PSG and in general invested the most money into the sport. The oil state funds did not win the auction for Chelsea -- but Saudi's were in it and were disqualified on a technicality. The UK more or less sold that club, and they obviously didn't want to take a club from an oligarch and sell to like MBS. (1) These funds have a longer investment frame than the PE investors. (2) They get the sports washing benefits. (3) Sport clubs will always be "valuable", or at least for foreseeable future. Making typewriters were a huge business once. The newspapers business is dying. The biggest cell phone companies died over like a handful of years (Nokia and Ericsson were 1 and 2). The best "brands" tend to do really well over time.
The biggest objection against a state controlled oil fund buying us -- is of course that they are kind of scarce. Abu Dabi, Saudis and Qatar already owns a team. But at the same time, Red Bull can own two Champions League teams. They only made a few minor adjustment in their governance, and UEFA approved one owner holding two CL team.
From my POV, it makes the most sense for Qatar to buy us. Simply because they (a) they already invested billions into PSG, they see a logic in that type of investment, the same logic x2 is there if they buy us, (b) they get the biggest synergies. Hence, Qatar is someone I think has some likelyhood of buying us. But would I bet money on it? Nope, not unless I got 20/1 in odds...
Qatar's interest in buying us has been played down by the Telegraph, but that was 'sources close" to them published just the day after. People tend to talk out of their arse. They are building a new Parc the Princes, of course beneficial to build two mega arenas in close connection to each other. Of course perfectly possible that they don't want two football teams.
The Saudi Media Group bid for Liverpool. They have an enormous amount of money. Hence, the Saudi Media Group is is someone I wouldn't rule out.
Abu Dabi --- through Sheikh Khalifa -- is interested in Liverpool. There is no rule against two half brothers or whatever each owning a PL team. I mean, in some way there is a symmetry behind it all. Two half brothers owning each of the Manchester teams.
Dubai. Bahrein is mentioned in relation to Liverpool. Kuwait. But like, these guys have had every chance to buy a football club. Why haven't they? What have changed? Is it because we are unique? Did they know Chelsea wouldn't be sold to a "state"? If not, why didn't they buy Chelsea?
Nah. my best bet is Qatar, Abu Dabi or the Saudi's. But who the heck knows. All of a sudden they look at how much heat Qatar has taken from the World Cup and loose interest in these type of investments. These things can easily change from year to year.
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Wow that's an amazing post. Thanks for the info my friend.
You bastards. Every time I poke my head in here in hopes of hearing a new rumor of grossly rich prospective buyers my hope is trampled and I leave depressed.
So they have taken us to the brink and now want out, but only if they get double what we should be worth, as there is bound to be someone who is desperate to come in and mop up all the mess they have made, and pay for all the stuff they should have already paid for already, but if they don't get their valuation matched then they will let us know and it will be business as usual, I think that's about right.
Honestly it's sick, and their business plan now rests purely on someone been willing to take on a vanity project or a consortium who wants a return, which will likely mean the sort of owner we have despised seeing at City and PSG that will put us with the clubs no one respects straight away, or another American buyer who will want a return, if it wasn't for the fact it'd harm the club even more then I'd love for them to be left to wallow in the mess they have made when no one pays up, whilst taking the full wroth of the fans.
I can't quite work out if them going public is because they are already far down the line with a sale, or if they have gone public to find a buyer, as if they already had one then it makes no sense them going public with it surely, you'd just announce the sale when it's done, it's not like they've got any fires to fight with fans right now where they needed to announce news like this to calm it down.
I suppose a theory could be they have an offer on the table which they will take if they have to, but want to put it out there first to see if a higher bid comes in.
Honestly it's sick, and their business plan now rests purely on someone been willing to take on a vanity project or a consortium who wants a return, which will likely mean the sort of owner we have despised seeing at City and PSG that will put us with the clubs no one respects straight away, or another American buyer who will want a return, if it wasn't for the fact it'd harm the club even more then I'd love for them to be left to wallow in the mess they have made when no one pays up, whilst taking the full wroth of the fans.
I can't quite work out if them going public is because they are already far down the line with a sale, or if they have gone public to find a buyer, as if they already had one then it makes no sense them going public with it surely, you'd just announce the sale when it's done, it's not like they've got any fires to fight with fans right now where they needed to announce news like this to calm it down.
I suppose a theory could be they have an offer on the table which they will take if they have to, but want to put it out there first to see if a higher bid comes in.
If the finances are really that bad, what’s to stop potential buyers waiting until the Glazers go near bankrupt and then buying the club on the cheap?
the downside to this would be the shipping out of our best players to bring money in.
the downside to this would be the shipping out of our best players to bring money in.
Our finances are bad in relation of what we need to do. The club needs serious investment in infrastructure, the squad needs investment as we are still not up to scratch. This is on the back of nearly 700m in debt. Any additional debt will cost a shit ton as we our capital structure is already highly leveraged.
If that debt wasn't there, the Glazers would easily borrow to invest in these things, especially infrastructure like Madrid and Spurs have done. The debt leaves the Glazers very little room to maneuver.
The club is not close to being bankrupt, even without a sale.
No disrespect intended, we've all got views but what is this trend of 'my opinion, but in bold' to give impression of expert analysis around this subject recently?
My opinion is that they bold it so it stands out more and peoples eyes are drawn to it more. As to why it’s become a trend.. that is much harder to answer but my opinion is that some social media apps have recently allowed you to bold words and this is how it has caught on and transferred to message boards
I instantly ignore any post doing it
I like the last one the best. "It'll be the Saudi's, Dubai or Abu Dhabi... but who the heck knows" not you evidently
we aren’t close to bankruptcy but we are close to having less and less available profit for transfers and general maintenance.
As fees get bigger it gives us less wriggle room and makes it way more important to do business well and smartly.
What clubs are spending 200m net a year on transfers and posting profits? There is nothing wrong with our financial situation. The issues we have are 1) How do we fund infrastructure spending without loading more debt onto the club whilst also spending the money necessary to revamp the squad. 2) How do we keep growing commercially when the toxicity around the ownership harms the brand. And 3) How do we still pay dividends to inflate the share price which has been the financial model for a decade whilst doing number 1. All these things disappear with new owners capable of investing. The underlying financial health of the club is very strong and the potential is huge hence why I have zero doubt we’ll be sold for lots of money.
He was asked for this thoughts. I dont get what's so funny.I like the last one the best. "It'll be the Saudi's, Dubai or Abu Dhabi... but who the heck knows" not you evidently
well there isn’t many clubs that can earn that amount of money. the issue is we’re paying 1:6th of our money earned on debt and dividends.
Anyway, im certain the club will be sold so hopefully all of that is not important eventually.
Freeing up an extra 90/100m a year of our own cash will be huge.
When you read what I replied to about bold statements giving off the impression of expert analysis and read the post it references as such, it becomes funny.
From what I can see we paid 33m in dividends last year (whilst posting losses…truly ridiculous) and 18m in interest payments. We haven’t been paying huge interest payments since the early days when the club genuinely was at risk.
It doesn't. He bolded the bits so that its easy to jump to when you can't be bothered to read the whole post.
feck all to do with expert analysis, especially when he caveats no one really knows and is just answering a post that explicitly asked for his views.
Really weird thing to get caught up on, aye. Messier has posted very interesting things throughout this thread, both technical analysis and his own opinions, and has made it clear when he was just expressing his thoughts. Weird that some people would find that funny.
As I said, I was replying to a post where it is stated that there is a trend to highlight opinions in bold statements to give off the impression of expert analysis. When put into that context, it becomes funny, especially when the post they are replying to implies that "they know their stuff".
I know they are just expressing their opinion, it's just the context that it's put in by the post I was replying to changes how it comes across.
I'm not even "caught up on it", so to speak, I just read it in a different context and found it funny. Not sure why I am being called out on my sense of humour.
what are you basing this on?
we're in a massive debt in a time when interest rates are soaring
the infrastructure of the club has been left to rot
and we need new owners to come in and bail us out
Qatar could be interested because they'll probably sell PSG soon.
There was rumours doing the rounds this WC that they're looking to sell a stake, not everything right now. Plus, after seeing how plastic PSG has become and how much they get involved with the running of things I'd be concerned about that lot taking over.
PSG, Qatar sheikhs, ligue 1 rights, BEin, The French, Platini, Airbuses have all done their jobs. They'll move on now.
As for PSG it's always been a nothing club to be fair, coupled with the fact it's in the French league, it wasn't surprising they went out down the route they did.
I’m basing it on reality not hyperbolic nonsense. The infrastructure of the club hasn’t been left to “rot” - we no longer have the best stadium or training ground in the country. We no longer have the best squad in the country. In order to achieve both those things investment in the short term is required above what the club alone can finance and the current environment with the glazers means adding more debt is a non-starter - it doesn’t mean the underlying financials of the club aren’t very sound. Yes - after committing a record 220m spend in the summer with no CL and after committing a 110m spend with the highest wage bill in football the summer before we have the same cashflow as Arsenal in December and have future payments over the next 5 years that are required to pay that squad investment off - that doesn’t mean the whole place is caving in - the club can easily afford those payments and still commit huge transfer spends each year. We need new owners to compete to a level we want to compete at with best in class infrastructure - we don’t need new owners to “bail us out”. The club isn’t in any danger of going bust - buy the club, invest money clearing the debt and find a financing model for the stadium and it’s basically guaranteed with the growth in football and potential of additional media revenue streams and virtual season tickets that in 10 years your asset is going to be worth double what you paid - that’s why many buyers are willing to spend billions on us. There’s some weird fascination on here and on Twitter to make out the club is dying and play down what a financial juggernaut the brand is - we’re a buyers dream.
when was the last time you went to OT mate? It’s been completely neglected since the Glazers took over
double in 10 years? That’s a crap return for an investor
you’ll beat that in an index fund with way less risk
I went at the start of the season. It wasn’t rotting. It needs investment. That doesn’t mean our underlying financials aren’t very sound.
We’ll find out if investors agree soon won’t we. I’m pretty confident we’ll go for 5bn plus and lots of bidders will be interested.
its a figure of speech mate
the fact we’re in debt that is not sustainable is the problem
that we managed this whilst neglecting basic upkeep is just further indication that we’re not being run sustainably
Good post! I think it’s the last paragraph in combination that — if they want to do a merger — it’s a resolution by the board gand not the Glazers, and the board directors must perform their due diligence before a merger or they could be held liable, I believe (this is high level complex Cayman Islands/US capital market legal questions of which I am not an expert, but roughly something like this applies).
That the Glazer’s would have a “preferred buyer” doesn’t really make sense. Like at least as long as that buyer isn’t some philanthropist. It is theoretically possible that they are extreme die hard Manchester United fans — but they don’t have any money. Avram Glazer’s net worth is estimated to be 1bn. A lot of that is Man Utd shares. If he wanted to fund the club building a new arena — he wouldn’t have the dough. Pushing in 100m for additional transfer funds is a huge cost for him. His dividend the last years has been like 6m per. If you live as a billionaire, the burn rate on that sum won’t be marginal. I don’t know, maybe they would sell to Radcliffe if possible.
But like selling to ‘the’ US consortium of their liking — that makes no sense whatsoever. 6 siblings.
With that said, it’s of course possible that they have an acceptable offer from a buyer which they will take if nothing better comes along.
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Ah fair enough, I thought it was higher than that. Still though, 50m a year is nothing to sniff about.
There was I thinking the 'because' was a clickable link!
Well at the minimum, they're planning to sell a stake
https://theathletic.com/3944200/2022/11/28/psg-owners-investment-qatar/
https://theathletic.com/3991146/2022/12/12/united-sale-manchester-glazers/
First real news in ages.
“Raine is aiming for a full sale in the first quarter of 2023 at a price between £6billion and £7billion. Whether that money and timetable can be achieved, only time will tell — and there are people in the City of London who believe such a valuation far surpasses reality, which we will explain later.”
“[Raine] have privately communicated that many parties have registered an interest.”
“…some to believe potential bidders will wait for United’s financial position to worsen before making a move…”
“Amazon has been mooted as a possibility by some close to the talks. […]A spokesperson said: “Amazon declined to comment on rumour and speculation.”
Apple was reported to be considering a move, […] there is no interest in tabling a bid.”
…
India is mentioned ‘as the next frontier’ after China and the Middle East
“…Ambani’s son Akash, 31, is, however, reported to be a big Arsenal fan…”
…
“When it comes to offers to Raine, serious talks are yet to materialise.”
“Undisputed, and not previously reported, is that Joel and Avram tried to buy out their siblings last summer. That is what those talks with Apollo, a private equity firm, were really about, rather than finding funding for a stadium rebuild.”
The article is finished with a section speculating on potential buyers, it is a good read but no new info from what I can tell. It’s mostly based on speculation from a US lawyer who also do these type of deals and experts on the Middle East.
First real news in ages.
“Raine is aiming for a full sale in the first quarter of 2023 at a price between £6billion and £7billion. Whether that money and timetable can be achieved, only time will tell — and there are people in the City of London who believe such a valuation far surpasses reality, which we will explain later.”
“[Raine] have privately communicated that many parties have registered an interest.”
“…some to believe potential bidders will wait for United’s financial position to worsen before making a move…”
“Amazon has been mooted as a possibility by some close to the talks. […]A spokesperson said: “Amazon declined to comment on rumour and speculation.”
Apple was reported to be considering a move, […] there is no interest in tabling a bid.”
…
India is mentioned ‘as the next frontier’ after China and the Middle East
“…Ambani’s son Akash, 31, is, however, reported to be a big Arsenal fan…”
…
“When it comes to offers to Raine, serious talks are yet to materialise.”
“Undisputed, and not previously reported, is that Joel and Avram tried to buy out their siblings last summer. That is what those talks with Apollo, a private equity firm, were really about, rather than finding funding for a stadium rebuild.”
The article is finished with a section speculating on potential buyers, it is a good read but no new info from what I can tell. It’s mostly based on speculation from a US lawyer who also do these type of deals and experts on the Middle East.
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So, what's the news?
I think the total investment could cost that much. The stadium alone, redevelopment or new stadium could easily top 1bn. I reckon the Glazers will be delighted with taking home 3.5-4.5bn.
Good question!
I think that the below can be labeled as "news":
I have just read through the article. Given that they have talked to people with insight in the process, some might be found between the lines.
Yeah, I posted about this a bit back. These type of 'price tags' can refer to anything, and there is a wide gap between the lows and highs on that spectrum.
If we look at the Chelsea takeover, it was reported by Sky as: "Todd Boehly completes £4.25bn takeover". Chelsea had been financed by Abramovich through loans to the club which was cleared before the sale. Boehly paid 2.5bn and promised to invest 1.75bn in a new stadium etc. By the same standards -- a "£6bn takeover" would mean that someone paid 6bn - 0.680bn debt - 1.75bn = 3.57 bn for all shares of the club. On the other side of the spectrum, the price tag could refer to Glazer's 68% stake of the shares of the club. Right? In that case, the purchase price for all shares would be 8.8bn. So 6bn takeover can mean anything from 3.57bn to 8.8bn.
The article refers to "Raine’s top-end valuation of £7billion", which in business lingo 100% would refer to a company on a cash free and debt free basis (CFDF), but exclusive of any commitments or plans to invest in a stadium.
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