With Manchester United calling off a €10 million deal for Adem Ljajić yesterday some media outlets have questioned the club’s ability to spend on players in the January transfer window. United, with a theorhetical £100 million transfer fund, brought in just Antonio Valencia and Gabriel Obertan in the summer. Is United’s £700 million debt beginning to bite?
The transfer window shut firmly today and with it United’s business for the summer ended. Having brought in two senior players and a further three in the ‘promising’ category, manager Sir Alex Ferguson has declared himself happy with his squad. But after the departures of Cristiano Ronaldo and Carlos Tevez earlier in the summer, the question is, do the fans feel the same?
“The bulk of the £80m fee we got from Real Madrid for Cristiano Ronaldo is still there, of course, and it seems to be burning a hole in the pockets of a lot of fans,” said Ferguson today.
“But you don’t suddenly scrap your transfer policy because of one defeat even if it was a bad one [to Burnley at Turf Moor].
“I have explained our strategy, based on my confidence in our squad with a few new faces, existing players maturing and more eager beavers on the way up, and I have no intention of abandoning it. I know we have the right squad.”
It’s a commendable show of faith by Ferguson, whose transfer policy – a few exceptions aside – has centred on buying players under-25 in recent seasons. It’s a policy that flourished with the development of Cristiano Ronaldo; bought for £12 million, sold for £80 million six years later.
Ferguson has built such a bank of credit over the seasons that to question his judgement is churlish. When it comes to players, the manager is normally right. In youth Ferguson may trust, but even the great man cannot guarantee success. For every hit there is also considerable risk in betting the house on youth. Indeed, of the younger players brought into the squad in the past two seasons none have conclusively proven that they will make it at the highest level. Coming into the new season there is considerable young talent at Ferguson’s disposal. Yet there are question marks over first team regulars Anderson, Nani and Ben Foster. Moreover there is no certainty that Fabio and Rafael da Silva, Gabriel Obertan, Mame Biram Diouf, Kiko Macheda or Danny Welbeck will make it either. Nor 23 year old new signing Antonio Valencia for that matter.
United must also deal with the inevitable decline of Gary Neville, Edwin van der Sar, Paul Scholes and Ryan Giggs; and the increasing injury prevalence of Rio Ferdinand as he enters his 30s. The result is that United cannot possibly line-up with 11 top class players as they have in the past. Ferguson has an awesome squad at his disposal but one with fewer proven stars than in the past. Indeed, only the aforementioned Ferdinand, together with Nemanja Vidic and Wayne Rooney can reasonably be described as world class this season.
United’s midfield is of particular concern. While well stocked, it is light in terms of proven quality.
There are also question marks about how the team will adapt to Ferguson’s tactics this season which – necessitated by the departure of Ronaldo – have evolved from a flexible three up front to a more conventional two.
That’s a lot of uncertainty and risk. A dip into the top end of the transfer market could have mitigated some of that. Ferguson felt it unnecessary and time almost always proves him right.
Manchester United is “using August as a testing ground for the current squad and may sign players at the 11th hour,” club sources told Sky Sports News’ James Cooper today. With the transfer deadline next Tuesday at 5pm GMT, United has less than a week to conclude any deals.
Manager Sir Alex Ferguson and managing director David Gill have both said that United will make no more signings in the current transfer window. “We’ve done everything we plan to do and it’s not easy doing business at this stage,” Gill told the channel shortly after the Champions League draw. However, the channel reports that the club is willing to move quickly if Ferguson feel the squad needs strengthening this late in the window.
With question marks hanging over several players in the squad – Anderson and Carrick were both left out of the squad taken to Wigan Athletic at the weekend – Ferguson may still decide to dip into the market despite multiple denials to the contrary. The club has recently been linked with former Chelsea winger Arjen Robben, who is available from Real Madrid for a fee of around £22 million.
United signed Dimitar Berbatov for £30.75 million past midnight on the final day of the summer transfer window 2008.
Manchester United’s Managing Director David Gill has today reiterated his manager’s stance – United will make no further summer signings after bringing in Michael Owen, Antonio Valencia, Gabriel Obertan and Mame Biram Diouf.
But with question marks hanging over Owen Hargreaves’ fitness and Ferguson’s options on the left side of midfield, is Gill right to keep £80 million from the sale of Ronaldo in the bank?
This summer Sir Alex Ferguson has returned to his austere Glaswegian roots, unwilling to spend the piles of cash he apparently has at his disposal. At least that’s the view of Manchester United’s managing director, David Gill, and the Glazer family, who have once again reiterated that the manager has money to burn. Quite how much Ferguson is not spending is anybody’s guess but if the Glazer’s official spokesperson on the Asia tour, Tehsin Nayani, is to be believed, then £60 million is the correct figure. But does anybody believe him?
Three matches into the Asia tour and fans now have a better idea how the team is shaping up ahead of the coming season. This includes significant weaknesses in wide areas and central midfield. Many fans expected those deficiencies to be addressed but Fergie has instead gambled on the potential of Antonio Velencia and Gabriel Obertan, and fitness of Michael Owen, while the big money has been spent by Real Madrid and Manchester City.
But fans should not worry about United slipping behind domestic and continental rivals according to the club’s management.
“We should not undersell our key assets. We have the history and heritage of Manchester United and 76,000 people in the stadium every week. I still think we are a major attraction,” said Gill this week.
“We’re not at the whim of someone pulling out and losing interest. That’s because we’re operating for the medium and long-term. United has been around since 1878 and our job is to make sure it’s still around for many more years in a sensible fashion. That’s by generating our own income.”
And that income was substantial according to the best estimates. United’s revenue is close to £300 million with profits wiped out by debt service interest payments of £81 million on £667 million of debt.
Nayani’s calculation was based on annual interest payments of £43.5 million, operating profits of £80 million and additional transfer profits of £25 million. A calculation that reveals a significant proportion of United’s interest payments were rolled back into the overall debt. The same was true of the £30 million paid for Dimitar Berbatov this time last year. It means that by the time United’s next accounts are published the club will owe more than £700 million to the banks.
Despite this Ferguson is free to spend the £80 million that was generated from the sale of Cristiano Ronaldo to Real Madrid this summer – less that used for Valencia and Obertan – according to Nayani.
But Gill is emphatic that United is not prepared to pay the same astronomic weekly wages as City and Madrid. Ronaldo will pick up more than £200,000 per week at Madrid and Tevez £150,000 at City – far more than either was earning at Old Trafford.
“It’s highly unlikely we’d want to go to those levels,” said Gill. “We don’t think it’s necessary because we’re looking to the medium and long-term. We knew what we’d do if Ronaldo went, we were going to get Antonio Valencia and the situation with Carlos Tevez needed sorting.
“Tevez didn’t want to stay so we made a substantial bid for Benzema but he decided he wanted to go to Madrid. Then we moved for Michael Owen.
“We also bought young players in Gabriel Obertan from Marseille and Mame Biram Diouf from Molde. We’re not in the market for 27, 28 or 29-year-olds for loads of money. It doesn’t make sense.”
It’s a policy that is unlikely to change in the current economic environment. While the manager has cash to spend this summer, he is likely to have less next year as the debt continues to bite. Good value or not, Fergie would do well to spend now. Nayani’s maths suggest that without player sales United will continue to increase its debt, or be forced to substantially cut the transfer budget.
The club’s management will point to the new £20 million per season shirt sponsorship deal with Aon that comes into play from summer 2010. The club has also substantially increased the total number of sponsors, which will show another large increase in revenues when the accounts are published next March. The current $12 million Asian tour is just part of that process.
For the moment, Ferguson has a £60 million sized hole burning through his back pocket.
Michael Owen will be manager Sir Alex Ferguson’s final prominent signing of the summer, according to the boss himself. While speculation has focused on who will replace the departed Cristiano Ronaldo and Carlos Tevez, Sir Alex insists that United has acquired the right signings, at the right price.
Speaking at the unveiling of Michael Owen, Antonio Valencia and Gabriel Obertan this afternoon, Ferguson blamed the inflated transfer market for the failure to land a big-name signing.
“Everywhere in England and in Europe the players’ values have shot sky high,” said Ferguson.
“I don’t think any of the transfers that you see happening are realistic but for some reason the market seems to have caught fire this summer. It is a very unusual summer and difficult to get value because of that.
“It’s always been the case that Manchester United have to pay a bit extra. But this summer we were not prepared to do that because we have got some very good young players.
“There didn’t need to be a kneejerk reaction to losing Cristiano Ronaldo. We did very well to keep him for six years. He wanted to go, and we allowed him to do that.
“We shouldn’t panic because one or two players are leaving. I think we have a very, very good squad with good young players in all positions.
“We asked about Benzema and we had a value for him. Lyons have done well because they got €42m but I think we took a sensible view.
“It’s the end of our business, so forget all these stories about who we’re supposed to be getting.”
Many United fans will be disappointed that the manager is not willing to open the cheque-book up and spend some of his reported £125 million summer transfer budget. A top class forward, left winger and defensive midfielder would undoubtedly enhance United’s team. But assuming that Ferguson’s budget is still available should he want it (and that may be a leap of faith given the club’s debt), then there is much to be admired in the boss’ approach. The United board has long been criticised for paying over the odds. This summer, in the face of bankrupt spending by Real Madrid, and the petro-dollars available at City, Ferguson has placed faith in value, youth and his own intuition.
While United does retain an interest in Gremio’s attacking midfielder Douglas Costa, it is likely that a deal will only be done for the Brazilian if his club backs down from their demanding for an eye-watering £20 million. The under-21 international is undoubtedly talented but when leading pundits in Brazil question whether United are “being conned,” then the club is right to set a price, and stick to it as they did with Karim Benzema.
Moreover, most United fans will appreciate the faith that is being placed in the talented youth team duo of Danny Welbeck and Federico Macheda. Ferguson has built his reputation on placing faith in the vitality of youth and there’s nothing wrong with doing so again.
The major risk is that of Owen, whose form and injury record over the past few seasons is far from impressive. With no top-class forward now likely to join United this summer, Owen will be relied on more than many United fans had first thought. It’s a risk that Owen rejects.
“It does irritate me that so many people have doubts,” said Owen, who has been handed Ronaldo’s number seven shirt. “If there is one thing I am angered by, the injury thing would be it.
“There is no doubt I have had injuries in my career. But there is a long list of players that have had a broken metatarsal. I was foolish trying to rush back for the World Cup and my leg had just come out of plaster. But I played 33 and 32 games in the last two years in a team that was not in Europe and did not go on a decent cup run. Still I was continually labelled injury-prone, which gets up my nose.
“I am 29 and have played over 500 games for club and country. That says it all.”
However, even if Owen remains fit and regains the form of old, the consequence of not spending big this summer will be felt on the pitch. History shows that Owen, Valencia and Obertan – 12 goals between them last season – cannot replace Tevez and Ronaldo who scored 41.
While Rant rarely engages in idle gossip, newspaper reports have once again linked United with a £20 million move for Real Madrid outcast Klass-Jan Huntelaar. It’s not the first time that the club has apparently expressed an interest in the former Ajax player, who scored eight goals in 20 games for for the Spanish club last season. Manager Sir Alex Ferguson had reportedly been tracking the striker before his £19 million move to Madrid in January.
However, the arrival at Real of Cristiano Ronaldo, Kaká and Karim Benzema this summer means that Huntelaar will be available for transfer, just six months after moving to Spain. The forward, who has scored 13 goals in 23 appearances for the Dutch national team, has become a victim of President Florentino Perez’ bank-loan inspired revolution at Real.
The question is, do United really need another central striker? That is not to doubt Huntelaar’s quality as a goalscorer, who’s record at international and club level is better than a goal every other game. But with Wayne Rooney, Dimitar Berbatov and Michael Owen now at the club, there would seem to be little room for another forward. Indeed, there was really little point bringing Owen into the squad if Ferguson is also after Huntelaar as both occupy the same role. This argument is even more pertinent when youngsters Danny Welbeck and Federico Macheda are brought into the equation.
At the same time, the club has also been linked with a £25 million move for Aston Villa’s excellent winger Ashley Young. The former Watford wide-man has progressed immensely in the past two seasons to become a regular in Fabio Capello’s England team. However, for a player who is unproven at international or Champions League level, Young would cost a fortune. Primarily because United would be shopping at one of the league’s leading teams, but also because there’s always a premium on English talent.
But United are weak in wide areas, despite having Ryan Giggs, Nani, Zoran Tošić, Ji-Sung Park, and new signings Antonio Valencia and Gabriel Obertan in the squad. Serbian wonderkid Adem Ljajić is also due to join the club in January 2010. But Giggs aside none are proven at the highest level, and unfortunately the legendary Welshman is in the twilight of his career.
Together with Valencia, Young would add extreme pace in wide areas – something United will lack through the middle of the park next season. While Tošić, Ljajić and Obertan may well prove themselves in the long term, nothing is guaranteed. Park, meanwhile, deserves his place in the squad as a willing worker but is never going to win a game on his own. Nani is in the last chance saloon.
Young, although frighteningly expensive, will be available if he expresses his desire to leave and does have the requisite quality to make a real difference at the top level. He would surely be a better use of more than £20 million.
The headlines have been dominated by the departure of Cristiano Ronaldo and Carlos Tevez this summer. Then Sir Alex Ferguson pulled the biggest suprise of the close season with the acquisition of aging Scouser, and former England international Michael Owen. But work behind the scenes has largely focused on recruiting the next generation of United stars, with Charlton Athletic’s Sean McGinty (15), Girondins de Bordeaux’ Gabriel Obertan (20) and Empoli’s Alberto Massacci (16) joining the club.
McGinty, a centre-half, has been capped at under-17 level by Ireland, with United reportedly reacheing an agreement for a compensation package with Charlton for the youngster. The 15 year-old was apparently offered a scholarship at The Valley, but rejected it in favour of a switch to Old Trafford. He is likely to move North with entire family.
Right-back Massacci is unlikely to cost United much, if anything, as an under-18 international transfer. The player himself broke the news of the impending transfer to United by claiming that Ferguson had personally called him to offer him a deal.
“When they called me, I really couldn’t believe it,” he said. “I didn’t believe that it was really him (Ferguson) on the phone.”
“I had an hour-long chat with him, in English. He seemed to me a modest, simple, incredible person. In life a chance like this only comes past you once, and you’ve got to grab it with both hands,” he added.
Winger Obertan, who has been capped eight times at under-21 level by France, will join from Laurent Blanc managed French champions Bordeaux. The player has appeared 77 times for Bordeaux, scoring four goals, although the vast majority of those games have come from the bench. The player spent the second half of last season on-loan at Lorient and can operate on the left-wing or up-front. He also scored against England under-21s in a friendly at the City Ground in March 2009.
“There is a very strong likelihood that the deal will go ahead,” said Bordeaux President Jean-Louis Triaud.
“Manchester United want to sign him and, for our part, we would be delighted to see Gabriel playing for such a prestigious club. We will make the official announcement when the time is right.”
Arsenal, Inter and AC Milan are all believed to have been interested in Obertan, but United moved first and has reportedly had a deal in place for several weeks.
The summer recruitment continues a policy that has seen the acquisition of Rafael and Fabio da Silva, Rodrigo Possebon, Federico Macheda, Davide Petrucci, Joshua King, Magnus Wolff Eikrem and Etzaz Hussain from overseas in recent seasons.
While the policy reflects the global nature of the football transfer market, it is also symptomatic of an outdated Football Association rule that bars United from signing youth players more than 90 minutes drive away. McGinty’s transfer goes ahead because the club has agreed a compensation package with Charlton.
But the rule will continue to encourage United, as well as other top clubs, to look abroad for the best talent or risk falling behind. And with transfer fees currently stratospheric, who can blame the club for seeking to hoover up the world’s leading youth talent?
A story broken in the Manchester Evening News, and followed-up by The Guardian and Independent this week have suggested that United are embarking on a under-26s only recruiment policy. The strategy, which comes into effect this summer, means that United will not recruit players 26 and over for large transfer fees that they cannot expect to recoup further down the line. It is a policy that ensures United are out of the running for David Villa and Franck Ribéry, as well as Kaká for whom they did not make a bid.
The policy, according to reports, is aimed at maximising the potential re-sale value of recruited players, which degrades markedly once a player passes 30. But it begs a question: if re-sale value is of greater importance in player recruitment than on-the-field ability, are United now a selling club?
In truth, Dimitar Berbatov aside, United’s recent recruitment policy has focussed on youth anyway. This is underscored by the acquisitions (at no little expense) of Anderson and Nani in the summer of 2007, together with the controversial aggressive recruitment of youth team players from oversees, including Federico Macheda, Davide Petrucci, Rodrigo Possebon and the Da Silva brothers.
But buying young is also a policy that comes with risk, as any supporter following Nani can attest. The £17 million that United spent on recruiting the winger is lost forever unless the former Sporting Lisbon player demonstrates a marked improvement in form next season. Moreover, Arsenal supporters will point to the destabilising effect that a ‘buy young’ strategy can have on the team. With Ryan Giggs, Paul Scholes and Edwin van der Sar facing potential retirement in 2010, United could be shorn of significant experience in years to come.
More worrying still is what the new strategy says about the long term state of United’s finances. In the light of Cristiano Ronaldo’s sale to Real Madrid this month, the plan has an undertone of long-term debt service. In essence the club’s policy says ‘we will not buy players whom we cannot sell on’. While this may be sound business policy, it is not necessarily the right policy for the good of the team. Significantly, it also means that United expect to sell players on in the future, rather than retain their services past 30. The gold medal scenario for United’s management hierarchy is then that of Ronaldo; buy low, sell (very) high.
In light of United’s huge £699 million corporate debt buying low to sell high in the future is a scenario that makes short-term business sense. The risk, however, is that United recruit too many failures – players with talent that is never fulfilled. Without proven talent coming into the club, United run the risk in the long term of degrading the team’s on-the-field success. With silverware comes sponsorship dollars, without there are none. And where’s the financial sense in that?