Friday, Manchester United’s executive vice-chairman/lightning rod/chief figure of fun (delete as appropriate) was ‘grilled’ by investors when he reported on the club’s financial results for the third quarter. Much like the ‘grilling’ in the second quarter there was little surprise that investor questions focus little on Manchester United’s on the pitch challenges.
How Manchester United fans have missed that feeling: late winning goals in huge fixtures such as the FA Cup semi-final. Anthony Martial’s superb winner against Everton on Saturday has granted the 11-times FA Cup winners another final appearance in May; a chance for a first FA Cup trophy since 2004. It begs the obvious question: if United secures the cup, and potentially fourth place in the Premier League, does Louis van Gaal have a future at Old Trafford after all?
Everybody hates Louis van Gaal, and rightly so. In the stands, in the press, probably even in his own house. After all, since the Dutchman’s appointment in May 2014 he has taken it upon himself to tear apart the Theatre of Dreams. Whether its analysis that insults the fans’ intelligence, or the insipid football on show, Van Gaal has successfully alienated the world’s biggest fanbase. Yet, it is not only mistaken to think that all Manchester United’s problems lie at the Dutchman’s feet, but naïve as well. The cancer comes from the top.
At the secret Glazer family money bank, Joel, Bryan and Avram proudly toast inking their latest commercial partnership. Joel strokes his wad as Avram preens, proudly sporting a freshly waxed pony tail. Bryan, known as the ‘fun one’, is busy celebrating United’s latest success by polishing his tractor.
It’s a slow news day when the headlines are less about Louis van Gaal’s failure as Manchester United manager, than Ed Woodward’s success as a financial architect. Yet, as United slipped from second to third in the Deloitte Football Money League 2016, the annual financial ranking of Europe’s leading clubs, there will be little concern in the Old Trafford Boardroom. After all – there is huge revenue yet to come, even if Van Gaal’s tepid side is just fifth in the Premier League. Read More
It was, one supporter departing Old Trafford claimed, the worst Manchester United performance in more than 30 years. Perhaps not, there have been some truly devastating defeats in that time, but few supporters can remember less entertainment on a night where United’s passivity in the face of a supposedly inferior opposition reached a fresh nadir. Indeed, the Reds’ narrow FA Cup victory over League One Sheffield United, despite a rash of defeats in December, may yet come to be seen as peak Louis van Gaal – a day when the tide finally turned in the endgame of the Dutchman’s Old Trafford departure. Read More
Just when you thought the crisis has hit its lowest point, Louis van Gaal’s side found a way to burrow further into the abyss. Following another comprehensive defeat at the hands of Stoke City the club has now lost four games in a row, something the Red Devils have not suffered since 1961. The side is also now winless in seven games. Can the situation get any worse?
The answer might be yes – a home clash to finish the year awaits, with Chelsea visiting Old Trafford on Monday. Optimism hasn’t been at a lower ebb at any point during the Van Gaal era, and most fans are hoping he is either given his marching orders or falls on his own sword before the end of the year.
Criticism of the Dutchman is almost certainly justified, with defence of his methods now as flimsy as the efforts of his back-four. Despite Van Gaal’s successes in rebuilding the club from the ground up, for which he deserves credit, on-field performances have at best stalled and are arguably going backwards. Patience with the process has reached a pivotal moment.
Comparison’s with David Moyes grow by the day – the two managers records are comparable, with Van Gaal’s number no longer that favourable. Yet the common thread between the two men is less the results, but the man who hired them: Edward Gareth Woodward.
Woodward was promoted to the role of executive vice-chairman when David Gill stepped aside in 2013, following Sir Alex Ferguson out the door. Whilst Woodward is clearly a marketing guru, the former banker has essentially acted as the Chief Executive Officer, Commercial Director and Director of Football for United in the past two years. It isn’t working.
The reality, of course, is that Woodward is succeeding in running United as a business, but not as a football club. The question remains as to why Woodward appears to be immune to media criticism given that he now has two managerial failures behind him. If Van Gaal is in the firing line, then Woodward should join him.
Woodward has not been clear of blame from the club’s fans since he was promoted to the top job. He is, after all, a figurehead for the Glazer’s ownership of the club – a controversial topic within itself – whilst appearing to place financial success far above on-field performance. Woodward, it appears, fails to grasp that on the pitch success also means that the dollars will follow.
Woodward’s first window in charge was underwhelming – he hired Moyes, then failed in pursuit of a string of star players, leading to a very public display of panic on transfer deadline day. Marouane Fellaini joined for £27.5 million in August 2013 when the Belgian could have been signed for four million less had he a move been completed in July.
This followed a tortuous summer, with fruitless pursuits of players that, in some cases, were never likely to join the club. It has become an unfortunate routine, with supporters teased on an almost daily basis once transfer windows open – an embarrassing turn of events for a club of United’s stature.
Woodward chased Leighton Baines through summer 2013, although the defender was never close to a move, with the vice chair leading a naïve series of low bids for both the left-back and his teammate Fellaini. The pursuit indicated a gross lack of experience in transfer negotiation and a lack of respect for the selling club, with Everton already hesitant to join negotiations.
Then, for all of United’s spending power and willing show of financial muscle, the club could not tempt Gareth Bale to stay in England and make the move from Tottenham Hotspur. Despite reportedly offering north of £100 million for the Welshman, Bale joined Real Madrid that summer for a world record transfer fee.
Cesc Fabregas also turned his back on interest from United and a year later led the Premier League in assists as Chelsea reclaimed the Premier League. Fabregas is struggling this season, but at the time the Reds Devils were in desperate need of creativity in midfield.
Fabregas’ compatriot Thiago Alcantara also seemed to be on his way from Spain before Bayern Munich’s late interest, and Moyes’ dithering, scuppered a move. The opportunity to sign Munich’s Toni Kroos was turned down a year later, which makes even less sense now than it did then as the German flourishes in Madrid.
The list goes on. Woodward’s apparent interest in Mats Hummels and Arturo Vidal approach farcical proportions, leading to accusations of amateurism in the transfer market. It was and is unacceptable given United’s stature and does not appear to happen to other European giants. The longer the club holds am interest in Cristiano Ronaldo the more it mirrors that of the ex who cannot accept their former partner has moved on.
Worse than amateur behaviour, United’s transfer policy seems to prioritise commercial interests ahead of playing needs. It led directly to United’s acquisition of Radamel Falcao and Angel Di Maria, neither of whom lasted 12 months in Manchester before bolting for greener pastures. The Argentine’s departure may prove to be a mistake, but Di Maria’s signature, despite his lack of fit within Van Gaal’s system, must also be questioned.
Then there is United’s chase for a central defender over the last two summers. It is, frankly, ridiculous that someone of a suitable calibre has not yet arrived at Old Trafford. Sergio Ramos used United’s interest to secure a new contract and the captaincy at Real Madrid, whilst Nicolas Otamendi now plies his trade on the other side of Manchester – and was signed at a relatively reasonable price.
Woodward might be a lifelong United fan, whose father attended the 1968 European Cup Final, but the executive apparently does not have the nous to lead United’s transfer policy. That is not to understate his genius in globalising United’s commercial operation, but what happens on the field is more important to the club’s future.
Woodward’s failings through five transfer windows and two managerial appointments is threatening to drive United into a sustained period of failure. Meanwhile, rivals at home and abroad have progressed far beyond United on the pitch, perhaps to the point that it will be hard to attract players from elite clubs, even if they are being forced out the door, as Di Maria was at Real.
The harsh reality is that even United’s English rivals are outpacing the Reds on and off the field. Pep Guardiola seems closer to the blue side of Manchester than the red, whilst United slips further down the league table with each defeat. United risks ‘doing a Liverpool’ and being left far behind. Perhaps for years to come.
And much of this regression can be traced back to decisions Woodward has personally made. It’s surely now time to start holding United’s vice chair to account if the club wants to move forward. The best scenario might that United’s future is one without its executive chairman.
It is 10 years to the week since the Glazer family confirmed the hostile leveraged buyout of Manchester United for £790 million. In the process the Glazers loaded the club with debt, alienated supporters and began the long road to inevitable mediocrity. Over the years Rant, both in it’s original guise (RIP all that content, thanks for nothin’ 1&1 Internet), and here since 2009, has written extensively on the takeover and it’s consequences.
Indeed, so extensive has been the coverage that another earnest article on the Glazer family’s fatuous regime is unlikely to be comprehensive. More than 50 reasons to still LUHG is a little better…
1. The hostile takeover. Nobody wanted it. Not the fans, not the United board, not Eric Cantona, Ole Gunnar Solskjaer nor David Beckham. Roy Keane did, because it made him “a few bob”, but probably not Sir Alex Ferguson, although the Scot said nothing and would go on to make millions from becoming the family’s most highly paid advocate.
2. The leverage. It wasn’t a takeover the family even funded, such as those at Chelsea or Manchester City. Instead, the Glazers borrowed almost £600 million from Deutsche Bank and JP Morgan, together with those mysterious Payment-in-Kind (PIK) loans, which bore interest rates in double figures. Yikes.
3. That debt. Talking of which, the debt eventually rose to £788 million – significantly larger than United’s annual revenue. Successive buy-backs, refinancing schemes and the 2012 IPO have removed the PIKs and reduced the overall corporate debt to a more manageable level.
4. But it’s still not gone. As it stands there is £380 million worth of debt on the club’s books costing something like £20 million in interest per annum. True, much of the cost is written off against tax, but there is no upside either. After all, United was a debt-free institution before the Glazers arrived.
5. £1 billion sucked out of the club. The Manchester United Supporters Trust (MUST), with the help of the indefatigable Andy Green, calculates that the family’s ownership has cost the club around £1 billion over the past decade in interest, debt repayments and other associated fees. Some of this figure has been recovered in taxes unpaid to the UK exchequer and dividends not realised, but the cost to the club’s finances still runs into hundreds of millions.
6. Death and taxes. They says only two things in life are inevitable. One came for Malcolm Glazer, although the family has dodged tax for much of its 10 years at Old Trafford. Debt is sometimes the capitalist’s best friend, but they’ve been stealing it from you, the taxpayer, for years.
7. Lack of investment 2005 – 2014. Whatever the extravagances of the post-Ferguson era there is little doubt finances restricted United’s ability to compete in a market forever changed by Manchester City and Chelsea’s free spending. Ferguson denied it, David Gill denied it, the Glazer family and their spokespeople denied it. You know better. Right?
[Source: The Telegraph]
8. “There’s nae value in the market.” There are some people who believed Ferguson’s excuse for this lack of comparative spending. The vitriol directed Rant’s way for pointing out the error of the Scot’s way was inevitable. For everybody else Ferguson’s take on the financial situation amounted to a gross lie. One directed at supporters. It was unbecoming of a Knight of the Realm.
9. The ‘Ronaldo Money’. On a similar theme, did anyone really believe that the ‘Ronaldo Money’ was ever earmarked for spending in the summers of 2009 and 2010? One would have to believe that Antonio Valencia was the best possible option available to replace one of the finest players on the planet. He just happened to be cheap. Honest, guv.
10. Michael Owen. Bebe. Antonio Valencia. Alexander Buttner. Value. Need we go on?
11. David Gill. ‘Safe Hands’, safer wallet. Gill has now retired to the luxury of life as a ‘consultant’ to the Glazer family and a FIFA Vice President safe in the knowledge that while he talked a good game back in 2005 – “debt is the road to ruin” – in reality Gill earned millions by negotiating the club’s way through a complex matrix of refinancings. Debt was indeed a road: to becoming a multi-millionaire.
12. Lack of transparency. Then again there has been very little transparency in the Glazer family’s financial shenanigans over the years anyway. The aforementioned PIK loans were refinanced secretly somewhere in the US, while the 2012 IPO included a move to register the parent corporation in the Cayman Islands. Home of the tax-free offshore account.
13. Ticket price rises. The inevitable fall-out from high levels of leverage was a significant hike in ticket price rises during the early years of the Glazer regime. Indeed, prices rose some 50 per cent between 2005 and 2010, with subsequent price freezes reflecting the relative lack of importance that ticket revenue holds as commercial and broadcast income grew.
14. Compulsory cup tickets. Want to watch United reserves and youth versus Scunthorpe for £53? Can’t make the game due to work or family commitments? Great! Here’s your ticket, whether you want one or not. Credit card already debited.
15. Those consultancy fees. Sure, “it’s their business and they can do what they like with it,” but the millions extracted by the Glazer siblings in superfluous management fees always exposed the ownership for what it was: not a “passion for Manchester United,” but a cow to be thoroughly milked.
16. “Franchise.” Yes, they did use that word.
17. Disenfranchisement. There is some irony in that acquiring the “franchise” the Glazer family has excluded thousands from the club to which they felt they belonged. Shareholders forced to sell against their wishes. Ticket prices rises that kept many away from Old Trafford. The youth for whom watching United is now a luxury not a way of life. FC United supporters who could take it no longer.
18. Cutting off supporters from communications. There was a time, post Rupert Murdoch’s failed attempt to buy United in the early 2000s, when supporters had a strong voice at the club. True, Peter Kenyon and David Gill may well have paid lip service to this group, but a voice of sorts was at least heard. No longer, although Ed Woodward has made some limited moves to redress this balance. The Glazers have offered one interview to the media in 10 years at the helm.
19. Where’s the next generation coming from? Which brings Rant to a wider point. Price rises and the ‘Blue project’ over in east Manchester threaten to undermine United’s local support for generations to come. It costs, at a minimum, £150 to take a family of four to Old Trafford on match-day. Unsustainable economics for most.
20. Stratford End Flags. “Tufty is a c*nt,” some people say. Rant couldn’t possibly comment on that, but the organisation does appear to be suspiciously friendly with the Old Trafford hierarchy. And the management allowed that banner.
21. The family’s business history. It’s embarrassing. From junk bonds to low-rent strip malls, failed fish food corporations and family feuding – it’s an episode of Arrested Development. Without the jokes.
22. The Glazers haven’t spent a penny of their own money. Through all of this not a penny has been spent by the family itself, even in the post-Ferguson, post-austerity world. Every penny spent is money generated by the club, not the family. The only financial relationship the Glazers have with United is to milk it for profit.
23. Cheap, embarrassing, sponsors. Mister Potato. Nissin Noodles. Kansai Paints. The Hong Kong Jockey Club. Globacom, the telecommunications company of record in Benin. Bakcell, the telecommunications company of record in Azerbaijan. Yanmar. Apollo Tyres. Gloops. Kagome. Blue chips they are not.
24. Yeah, this really happened
25. And while we’re on it… the narrative around commercial genius is largely exaggerated. After all, the Glazer family did not negotiate the huge rise in broadcast revenue that has come the Premier League’s way in the past decade. Nor did they drive the UK telecommunications market towards greater consolidation, with the convergence of telco, media, mobile and broadcast industries driving the value of sports rights ever higher in an otherwise highly commoditised market.
26. The Glazers do earn some credit for exploiting United’s commercial worth to the fullest, if credit is the right word here. But the worldwide rise in the sports rights and sponsorship market has also been exploited to a huge, possibly even greater extent, at Real Madrid, Barcelona, Bayern Munich and even Manchester City. The Glazers are not outliers, nor even pioneers, but riding a very lucrative wave.
27. Man they be ugly. Uncle Malc and the Glazer siblings fell out of the ugly tree and hit every branch on the way down. Rant wouldn’t like to call this carpetbagging dump of a family ‘trailer-trash,’ but dang if they don’t have webbed-feet then we’re not called United Rant!
28. Seriously ginger too. Not that there’s anything wrong with gingerness, you understand.
29. That pony tail. Have some dignity, man. There’s nothing on God’s good earth that is less dignifying than a balding middle-aged white man who thinks a pony-tail ensures his ‘cool’ remains intact. No way daddy-o. No exceptions. Unless your name is Samuel L Jackson.
30. Papa Glazer never set foot inside Old Trafford. He loved the club, just not enough to hop on a plane from Tampa to Manchester and show face at the ‘Theatre of Dreams’ from time-to-time. Did he not long for a warm Old Trafford reception?
31. Absentee landlords. Come to think of it the Glazer spawn rarely attend more than a handful of games each season anyway. Surely it’s more fun than watching the Tampa Bay Buccaneers? Even under David Moyes.
32. The ‘sister club’. Which brings us to the Bucs – the runt in the corner everybody pretends doesn’t exist. Owned and abused by the same family, Bucs fans are just as angry with the Glazers as United’s supporters. Over the past 12 years the Bucs have secured just two play-off spots, while attendances have fallen. The Glazers, at once stage, were forced to buy their own tickets to stop a media blackout demanded by the NFL when stadiums are half-full.
33. The Old Trafford pies universally suck. Remember that short-lived Jamie Oliver campaign to improve school food? Admit it, you were shocked that a school dinner could be produced for 17p and still be fit for human consumption. Old Trafford’s pies probably cost less to manufacture, but still retail at £4. Warmth is optional as, apparently, is meat in the ‘meat and potato’ travesty.
34. Champions Lager. The worst. To bastardise the peerless John Oliver: “it tastes like the urine of a scared rabbit” and the “ghost of a dead lemon.” The Singha now served at Old Trafford isn’t much better.
35. Gloablisation. Or should it be called de-localisation. The search for new sources of sponsorship revenue. The profile of the Premier League. Global media reach. Whatever the cause, the result is an Old Trafford supporter base that is decreasingly local and increasingly tourist. This is a sensitive subject of course. The way of the world, or the sad demise of 125 years of local tradition?
36. Dividing the fans. Talking of the fans: has there ever been a more divisive subject among supporters than the Glazer ownership? For those fervently committed to anti-Glazer activism over the past 10 years – whether that’s financial analysis, Green & Gold scarves, or match day boycotts – the bone-headed ‘support’ for the family has boggled-the-mind. And no this is not an anti-American agenda. Nor, most certainly, is it anti-semitism either.
37. Revisionism. This week’s public relations campaign to rewrite the history of the Glazer regime in the face of recent transfer market spending is classic revisionism. After all, the club is spending its own money, not the Glazers’. Money earned for being Manchester United. Paid for, directly and indirectly, by the supporters.
38. FC United. FCUM is a wonderful institution – a permanent reminder of football’s more sacred days. It is a club owned, run and operated by the fans, for the fans, without profit, but with much love. As it should be. This year FCUM will move into a new stadium, financed largely by supporters, but it took the alienation of thousands of Reds to make all that is FCUM. There is a bittersweet taste to that.
39. Fergie turning on the fans. Genius coach; bastard man, not least because of Ferguson’s fervent support for the Glazer family. Bought and paid for, Ferguson was never less than emphatic in lauding the Glazer regime even during the years of austerity. But did he really have to tell supporters to “f*ck off to Chelsea” if they didn’t like it? No. No he didn’t.
40. David Gill turning on the fans. See above. Rinse. Repeat.
41. New York IPO. It is one of capitalism’s crueller ironies. United, formed by the workers of the Lancashire and Yorkshire Railway, as a local institution for local families, is now traded algorithmically by computers in a data-centre in Hoboken, New Jersey. It is perhaps the inevitable outcome of globalisation. None of this makes it any less morally corrupt.
42. Registration in the Cayman Islands. Home of tax-dodging billionaires and Tory donors, Grand Cayman has long-held a laissez faire attitude to business transparency and standards. No questions asked, none answered. The perfect spot for the ultimate registration of United’s parent company.
43. Taking £75 million out of the club and lying about it. That IPO was supposed to be used to write down debt. At least that was the Glazer promise. Instead the siblings took millions for themselves, probably to pay down the refinanced PIK loans.
44. And then they did it again in a second release of capital last year.
45. That mysterious incentive scheme. Did Ferguson profit? Did Gill? The IPO also welcomed a new ‘Equity Incentive Reward Scheme’. Share options to the uninitiated. Somebody is making bucketloads of cash.
46. Ed Woodward. Rant has no doubt Woodward is a brilliant marketeer. He may even be a decent man wrapped in the vapid shell of a management consultant, but he’s the worst kind of football executive. Customers, not supporters. Market exploitation, not lifelong passion. A media company, not a football club.
47. Endless tours. Summer tours were once fun; they still are to an extent. But where a quick trip to Scandinavia, with all the joys of Oslo that it would bring, was once the fair now United’s summer is replete with long-haul destinations. More than 20,000 miles of travelling during the last two summers. As Louis van Gaal has discovered, it is a far more about marketing than “preparation time” for the new season.
48. The official website. Is it the Glazer family’s fault that ManUtd.com is just so dog awful? Probably not, but the business practices certainly dictate that a ‘digital season ticket’ now costs in the region of £40 per year and the only way to read some content is to sell your personal data to the club.
49. The lob-sided stadium. There was once a plan, taken seriously at the highest levels of Old Trafford, to extend the south stand beyond its current single-tier base. The train track behind the stand is problematic, but the club had begun to embark on buying property in Railway Road in anticipation. That property was sold some time ago and plans shelved.
50. David Moyes. Not only did the Glazer family believe that they continue winning on the cheap with the Scot, but they actually let Ferguson hand-select his replacement! The man whose due diligence on Bébé extended to a single phone call from Jorge Mendes. Moyes was a disastrous appointment, whose wholesale failing as a manager of United’s standing reflects very poorly on his employers. It cost United more than £60 million and counting.
51. Marouane Fellaini. In a pre-or-post Glazer world would United have even countenanced purchasing this lanky, talentless, lump. And for £27.5 million? Not a chance. Fellaini is an outward sign of the failure to modernise United’s recruitment policy and processes – this is in part due to Ferguson’s lengthy reign, but the United hierarchy has not made enough progress either.
52. The women’s team. Last, but definitely not least, United once boasted a proud, if largely unsuccessful, ladies’ team. One of the Glazer family’s first acts as owners was to deconstruct the team because it did not fit with “the core business.” In 2013 the idea of bringing back the team was apparently mooted; the promised “assessment” did not bring back United Ladies.
Rant’s man in Switzerland uncovers secret talks at an advanced stage.
Manchester United’s ruling Glazer family is holding secret talks with Seppe Blatter as a precursor to the FIFA President joining the Board this summer, Rant has learned. In a controversial move, it is believed that the talks are at an advanced stage, with a formal announcement possible after the FIFA presidential elections conclude this year. Rant understands that talks were brokered by new FIFA vice president and fomer United managing director David Gill.
It has taken, by any reasonable assessment, just shy of £700 million in interest, repayments and fees, three refinancing rounds, and countless intrigue, but Manchester United’s huge corporate debt is finally under a modicum control. There have been times, many of them, when the day seemed unlikely.
Not that United is debt free – far from it, in fact, with more than £360 million still on the club’s books. But with annual debt interest now down to £20 million per year, the club is heamorrhaging the equivalent of just the one international-class signing per season, rather than four.
It poses an interesting scenario. With United’s corporate imperative no longer financial survival, there is the theoretical possibility that the Glazer family could finally unleash United’s revenue generating potential, investing in the club both on and off the pitch. After all, United’s cash-generation has never been stronger, while there is plenty of equity still to be released should the family issue more shares, as is believed likely.
History, of course, says supporters should throw that logic to the wind. After all, the family has a record of placing its own financial requirements first; United’s a distant question. The club’s August 2011 IPO in New York is a case in point, with the family backtracking on an initial promise to retain the proceeds within the club.
Yet, the question of investment is now on executive vice chairman Ed Woodward’s desk. The 40-year-old is juggling debt, the club’s rampant commercial drive, and the inexorable rise of wage inflation, as the Reds ponder moves in the January transfer window.
Still, United’s Q1 figures issued this week demonstrate strong revenue growth – up 29.1 per cent to £98 million for the first quarter of the financial year. Commercial income rose 62.6 per cent on the back of a dozen new sponsorship deals, while record Premier League broadcast rights income, and the summer season-ticket influx contributed to a surge in turnover. United reported operating cash flow of £32.3 million in Q1 and cash profits before transfers up 36 per cent to £22.2 million.
The Premier League’s £3 billion deal for domestic rights, which represents a 70 per cent increase on the previous contract, has significantly bolstered United’s coffers. And this is a bubble not yet ready to burst: BT Sport’s victory in outbidding Sky for Champions League rights is likely to ensure English clubs earn an extra £10-£15 million each annually from 2015. BT will pay £900 million for Champions and Europa League matches over three years.
“Sport is the ‘must-have’ content, its value has grown dramatically,” said Woodward, speaking to investors on Thursday.
“We are excited by the continuing rise in the value of sports content, evidenced, amongst other things, by the recently announced BT deal for the UK rights to broadcast the Champions League and Europa League matches. This deal represents a meaningful increase over the current arrangement.”
Players continue to be the principle winners of the rights inflation though, with United’s staff costs rising by 31 per cent to £52.9 million in Q1. UEFA’s financial fair play rules are yet to bring deflationary pressure on salaries it seems, although Woodward argued that “a fall in the acceleration around player wage growth” is now being felt in the Premier League. Just not at Old Trafford.
Yet, it is debt not wages that has most afflicted United since the Glazer takeover. Obligations still run to £361 million, although debt service costs have fallen on yet another round of refinancing. United owes around £200 million in bank debt, at a rate fixed between three and four per cent interest, with the rest in bonds at almost nine per cent.
By the time United is free from arrears, if ever, the club will have wasted more than £1 billion on the Americans’ debt.
Still, with more than £80 million in cash sitting in the club’s bank account at the end of the quarter, supporters may ponder not only transfer market muscle finally being flexed, but investment in a stadium that has remained largely unchanged since the family took control in 2005, notwithstanding commitments made prior the family’s arrival in Manchester.
Indeed, the argument for new spending on the pitch is strong given the club’s rocky start to the new season under manager David Moyes. The Scot presumably still hankers for a new left-back and high-quality central midfielder.
Whether Woodward has the will or means to secure new acquisitions is a question that will only be answered at the end of January. Certainly, supporters expect a far more professional approach to the market, whether substantial cash is spent, or not.
Meanwhile, the Manchester United Supporters Trust (MUST) is actively pressing the club to invest in new infrastructure. Woodward’s arrival has re-opened lines of communication between principal supporters’ groups and the club, with MUST and the Independent Manchester United Supporters Association (IMUSA) previously ostracised by Sir Alex Ferguson and David Gill.
While MUST chief executive Duncan Drasdo’s recent meeting with Woodward remains off-the-record, the group is believed to have pressed for the introduction of German-style rail seats, potentially – and controversially – part-funded by supporter investment in new shares.
“We’re interested in exploring ways to progress introducing a section of these seats,” Drasdo told the Independent this week.
“We can see potential for fans who wish to, to invest in shares in the club, with the funds ring-fenced for specific purposes such as rail seats or stadium expansion. It would be an excellent demonstration of the value which can be derived from fans investing in and sharing ownership in their club.”
“The cooperation and the participation of fans in the ownership of the club brings an improvement to the atmosphere as well a financial benefits to the club.”
In MUST’s call there is some wry humour. While Old Trafford’s bean counters posted record financials, just eight miles to the north east, FC United of Manchester broke ground on a new stadium at Moston this month. Set to open August 2014, the community-funded 5,000 capacity venue will be FC’s first permanent home, nine years after the club was formed in the wake of the Glazers’ arrival.
Moston Community Stadium will cost £5.5 million to construct, with £2.5 raised by supporters, and the rest granted by Sport England, the Football Foundation, Manchester City Council and Manchester College. It is the kind of kind of community effort actively shunned by big brother to the south.
The irony in big United turning a financial corner, after eight years and £680 million wasted, is surely not lost on those in Moston. Whether security now pushes United to invest in team and stadium is open to question. After all this time, few supporters will bank on it.