It was quite ironic that the Premier League announced on Wednesday it is banning fully-leveraged club buy-outs via a unanimous decision.
Eighteen years ago the Glazers acquired Manchester United for £790m using loans to finance a large proportion of their takeover. United would have been one of the clubs who cast their vote in Wednesday’s decision.
It must be underlined that the Glazers did use some of their own funds in their 2005 takeover. But the irony lies in that the debt acquired from loans - some of them secured against the assets of the club - has been such a charged subject during their tenure.
It’s really no wonder why Sheikh Jassim bin Hamad al-Thani’s bid to take full control and wipe all debts seems so appealing. Even more so amid rumours that Sir Jim Ratcliffe may keep Avram and Joel Glazer on as minority shareholders.
ALSO READ: Premier League announces change to takeover rules amid United sale
The takeover process is in its seventh month and the conclusion is still unclear. It’s thought that a preferred bidder will soon be named but fans should not expect any kind of official update.
The last time the board communicated directly to supporters was in November’s sale announcement. Reports suggest both Sheikh Jassim and Sir Jim are now waiting on a decision from the Glazers following the submission of revised bids.
In the meantime, the share price of United had risen to the highest peak for a month and has rocketed more than 110 per cent in value since this time last year. The waiting game is benefitting the Glazers.
The high prices fuelled by constant speculation - whether accurate or not - is giving the Glazers a bargaining chip in negotiations. They value the club at £6bn and both bids fall short of that, albeit they have increased from the initial offers.
There is the possibility that the Glazers stay. Such a move would cause the value of the club to plummet but it is unlikely to ever go back to the prices of last year. The judgement of New York stock market traders regarding how much they think United is worth will dictate their investments.
With figures of £5bn and £6bn being thrown about amid intense interest, the valuation of the club has been laid bare. United are the second most valuable club in the world, and according to Forbes, it is worth £1.1bn more than it was last year.
Those kinds of figures don’t dissolve quickly and the longer the Glazers remain in charge, the more money lines their pockets. By waiting this long to make a decision, and putting prospective owners through continuous rounds of bidding, the current owners are squeezing as much value from the club they can. Whether they stay or not, they have undoubtedly benefited from the long-game.
READ NEXT:
