Manchester United: From Cash Cow to PR Project
Once upon a time, Rant mused that the Glazers might sell. Peter Lim, Chinese investors, and even the Red Knights were said to be potential buyers should the Glazers decide to cash-in on their prize asset. Conspicuous in its absence was Saudi Arabian sovereign wealth. If there’s any group that needs positive PR right now, it is the House of Saud.
The Saudi government’s strategy to increase soft power and diversify its economy away from oil has included investments in Formula One and WWE, among numerous tech investments. It won’t have escaped Crown Prince Mohammed bin Salman’s attention that near-neighbours Abu Dhabi and Qatar have benefitted internationally from the ownership of Manchester City and Paris Saint-Germain respectively.
From this perspective alone, recent speculation about Saudi interest in United makes sense. After all, there are few better ways to boost an international profile than by owning the planet’s most iconic football club.
At the time of writing, there are few details of any potential bid. Reports range from the Glazers not being willing to sell to United staying quiet about a possible takeover. Whatever the truth, the rumours initially benefitted the club’s share price to the tune of five per cent. The exact source of any takeover rumour is yet to be ascertained though that hasn’t stopped the news from capturing the imagination of the sports pages. Avram Glazer’s plan to attend the ‘Davos in the Desert’ Future Investment Initiative added fuel to the speculation, although he latter pulled out alongside many others. United already benefits from a partnership with the country’s General Sports Authority, while Saudi Telecom is the club’s longest running commercial partner.
Whatever the truth of Saudi interest, the Glazer family remains in a strong negotiating position. Now under no pressure to offload their prize asset, the Glazers can choose to keep United and milk the cash cow. Meanwhile, any sale would be well in excess of the current £3.5 billion market capitalisation – a very tidy profit on the heavily leveraged £790 million takeover 13 years ago.
Don’t expect the Glazers to make any moral judgements either; any decision will be made on purely business lines. United fans might find themselves in a difficult place, caught between vast new wealth and a pariah regime. If Bin Salman succeeds in at the mooted purchase, United’s mission could change from a being profit-making machine to a public relations institution for a country facing accusations of murdering a journalist, among other human rights violations.
The House of Saud will not run short of oil cash any time soon, but the regime is aggressively trying to improve its global image. United could focus the world’s attention away from the less savoury aspects of the Saudi government – specifically its record on human rights – much in the way City has for Abu Dhabi and PSG for Qatar.
"Figures familiar with the area say the centralisation of power around Crown Prince Mohammad bin Salman in a country where it has previously been very spread out has made such moves much easier. It is the Crown Prince who is claimed to be personally interested in bidding for the Glazer family’s private shares."The Independent
On another level owning United would see Middle Eastern politics potentially played out in the Champions League, Europe’s premier competition. Whether the greatest prize in the European game should turn into proxy struggle between oil rich Arab states is another question.
On the sidelines, literally and figuratively, is the United fanbase, which will have little say in any potential transaction. On a purely financial level, a Saudi takeover could see the club become debt free given the net worth of the House of Saud is estimated to be over $1.4 trillion. Moreover, a surefire way for any new owners to ingratiate themselves with the fanbase would be to pump money into all areas of the club, from investing in the stadium, building projects for the community, and into headline-making transfers.
After all, decisive action in the transfer market has worked wonders for the Abu Dhabi royals over at the Etihad Stadium. At United, new owners could put into place a proper football structure, while retaining the club’s highly successful commercial arm. Indeed, if Saud is looking for a template they only need to see how the Blue side of Manchester has gone about its business.
But then United – being the most valuable club in the world – shouldn’t be hamstrung financially with respect to the transfer market anyway. Executive Vice Chairman Ed Woodward famously boasted that “we can do things in the transfer market that other clubs can only dream of.” If anything is holding United back, it is the prioritisation of finance over football. The club has only belatedly recognized the need to revamp the sporting structure.
But what should the average supporter feel if Bin Salman spearheads a takeover at United? Certainly, there is unlikely to be appetite for mass revolt. BUT the question of human rights cannot be ignored. City and PSG are the properties of nations with questionable records. Indeed, United fans – among others – have pointed to that fact about the owners over at the Etihad. Should United be acquired by a country who’s record is perhaps even worse it should give supporters pause for much thought. Money would come at a significant price.
"Whether the Glazers retain ownership at United or sell to new buyers, the club faces the prospect of continuing as a business venture for uncaring owners, or a public relations tool for new ones."
Fans are powerless, and are unlikely to sway either party should a real bid come forward. Football is not known as a business that concerns itself too much with morals. The recent World Cup in Russia was hailed as one of the best in recent memory, although it was held against the backdrop of an increasingly autocratic country. Football has a habit of duping supporters and the media into focusing on the diamond without ever needing to explain how the precious stone was procured in the first place.
Whether the Glazers retain ownership at United or sell to new buyers, the club faces the prospect of continuing as a business venture for uncaring owners, or a public relations tool for new ones. It is a naïve strand of thought, perhaps, but many would welcome United becoming a football club once again.