Manchester United chief executive says there will be no Wayne Rooney sale to Real Madrid this summer, with money also available for further player signings if Sir Alex Ferguson wants them. Well he would, wouldn’t he? The ceo who cries wolf but really just wants season ticket and box sales before supporters realise the game is up!
For while United may well spend this summer – there is theoretically a £75 million credit card facility available to Ferguson – the club’s business model is so massively leveraged that it is now hemorrhaging money from every pore.
Gill remains tight to the party-line, claiming Ferguson is under no pressure to reign in the spending this summer or say anything to the contrary.
“The money is there,” Gill told the Manchester Evening News.
“People say Alex is saying that because he has to. Anyone who knows Alex Ferguson knows he wouldn’t say that if he didn’t mean what he said.
“We are not in a situation whereby Alex is restricted in what he wants to do with the club and his methods as a manager.
“We have never said: “You can’t do that, we have to pay interest on the debt.
“People don’t believe it. We never said to him: ‘You can’t go for that player because he’s too much’.”
Gill’s problem, with United’s financial predicament now exposed by the January bond issue, is that few take the 52-year-old executive’s word at face value.
Tellingly some analysts now believe that player sales are deeply ingrained into the club’s underlying business model. It’s hardly a surprise to fans following Sir Alex’ statements on the transfer market in recent weeks, with the Scot not only forced to shop at the bottom of the market but specifically required to buy players that retain a resale value.
The question fans must ask is why acquisitions require a resale value if the club isn’t de facto prepared to sell?
It’s a new paradigm that only the hugely naïve believe will have no lasting effect on United’s transfer strategy, with the club losing more than £66 million on non-football related expenses in the last quarter alone.
“The loss shows that the business model doesn’t work unless there are player sales,” Philip Long, partner at PKF accountants and business advisers,told the Guardian newspaper today.
“It’s an absolute mess – when the full-year interest is accounted in and there are no items like last year’s sale of Ronaldo, what’s going to happen?”
It’s a question that needs no answer.
Few believe that Rooney, United’s most valuable asset, will leave this summer, with the former Everton striker settled in the North West.
Indeed, optimists could point to the ‘guided’ net £25 million per annum transfer budget available to Sir Alex, plus the money from the sale of Cristiano Ronaldo last summer.
In reality if Ferguson spends anything this summer the pressure to sell leading players in a year’s time – before the club files the 2011 year-end accounts – will be overwhelming.
Indeed, with the Payment-in-Kind (PiK) loans moving from 14.5 per cent to 16.5 per cent in August the smart money is on the Glazer family drawing down both the £70 million cash and the £6 million special management fees provided for in the bond document.
Those fans seeking a marquee signing this summer need only look at the numbers, with United sitting on a cash pile of £95 million set to lose 80 per cent of its value in the coming weeks.
While that raid will happen fans are now unlikely to discover the truth until the Autumn, with any cash removal taking place after the financial year-end on 30 June and therefore reported at the end of November.
As the Americans love to say: ‘you do the math’.