if you look at my spoilered bit it talks about a lot more how the debt could affect us than just getting players, but that is in the risk reporting and they have to say what could possibly happen.
ALL issues relating to the bond issue and club finances
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I say that when you do a comparative cost-benefit analysis between the old PLC structure and the current ownership then you'll appreciate that we're better off with the Glazers.
Not bad
So they're offering shares pretty much on the debt to pay the debt. Whilst they are keeping their own shares (the b shares) that will give them 10x the voting power.
Don't go reading to much into the risks section statements. They have to suggest worse case scenarios.
Reducing the debt by 25% is a step in the right direction.Hopefully big interest in the sale may see an increase in the debt serviced.It will be a great day for us all when the debt is wiped clean and more of the money our club makes gets re-invested in the team.
I thought that nice Mr Gill said the debt wasn't a problem (post pay rise obviously)? this is all very confusing... 
I thought that nice Mr Gill said the debt wasn't a problem (post pay rise obviously)? this is all very confusing...
Again don't read to much into the risk section, it also states that the club could be affected by a fall in the popularity of football. The Premier league losing it's appeal and us possibly being fined or relegated.
So does this make us worse when we float GCHQ?
We are moving towards a semi Plc structure where we have the problems of Dividends that apparently make us so much worse of than half a billion in debt!
I cannot see you as anymore than a troll if you fail to critique the financial implications of this in the same way you have always done re Dividends for shareholders.
We are moving towards a semi Plc structure where we have the problems of Dividends that apparently make us so much worse of than half a billion in debt!
I cannot see you as anymore than a troll if you fail to critique the financial implications of this in the same way you have always done re Dividends for shareholders.
The fact that it's happening is an admission that the club is hindered by debt.
Hopefully there will be interest, if we can wipe out 50% of our debt we will be in a very strong position going forward.
Good move from the glazer's at last.
Good move from the glazer's at last.
wtf does it matter? If they see an investment opportunity (canning factories, trailers, shopping malls, whatever) that they think will make them more money they'll mortgage the club right back up again anytime they feel like it.
They are in this for one thing and one thing only, money, they couldn't give a shit about United as a football club.
No it's not.
The start of an exit strategy? I always envisaged them selling up bit by bit rather than in one big lump.
Why are they doing then?
Hope this works.
Exactly. A lot of ridiculous scaremongering going on as usual. It was just the same when the last prospectus came out in Jan 2010.
Why do this now and not 5 years ago? Or next year?
They are doing it to make money to pay off the debt. That as it gets paid off puts the club further into their pockets. Giving them more ownership of the club. It's not proof that we are hindered by it, it's just the next step in their strategy, same as the bond issue and this one isn't even a full on ipo, it's a tester to see if there's an interested market. When they start putting up their 'b' shares will be when they are struggling.
I thought that nice Mr Gill said the debt wasn't a problem (post pay rise obviously)? this is all very confusing...
It isn't a problem. It just makes (common) sense to swap some debt for equity considering that we're paying c. 8.5% on the bond debt.
No it isn't proof that we're hindered by it, at the rate cash has been spent on the servicing of the debt any club would be though.
Wonder if Fergie will be doing a promotional video to drum up interest.
Granted a lot of people are going to look at worst case scenarios and you seem to be able to explain it better than most but it's not exactly good news every time we do something to reduce the debt interest etc.
Genuine question (I'm not trying to stir or catch you out) - if Ferguson had a health scare tomorrow, had to retire and we finished 5th, what would happen? Would the decreased revenue matter short-term? What about 3/4 years without CL football.
It makes sense, depends who benefits ultimately though.
This is actually very true. Any well run company has an optimised mix of debt and equity - obviously we have no equity at the moment.
However, the thing I think we'd all like to see is some kind of long term plan. At present there appears to be no indication of when/ if the Glazers want to reduce debt to a more manageable level.
What will be interesting will by the dynamic of having shares that are floating. Basically, the worse we do on the pitch, the less able we are to increase revenues, and therefore our share price should go down. So the only way to maintain our share price is to release enough funds to allow us to remain attractive on the pitch.
Real
You have always argued equity is more expensive than debt. (And funnily enough it can be depending on dividends but ignores the inherent risk to the club of debt.
Something fans should be more interested in than money the owners make.
Where was your (common) sense when we switched from completely debt free equity ownership to debt laden ownership when the Glazers took over?
I am out of this thread.
Now I understand why I gave up two years when I pointed out the benefits of equity over debt which you now graciously can see for yourself.
These shareholders will have sod all power and the reduced interest payments from the debt to equity swap will more than make up for dividends paid to those shareholders.
Except we've not been. The prospectus on this actually shows we're coping very well. I'm not a Glazer fan and I don't want them involved with my club in anyway shape or form but I've just read the full sales prospectus and it makes very chilling reading for me because they are running it soundly and through these constant strategies they keep getting more and more of our club fully under their control.
It does strike as being a bit risky/desperate to do an offering now.
$100m - Jesus I hope they sell more than that. It's barely two quality players.
$100m - Jesus I hope they sell more than that. It's barely two quality players.
The club has loads of equity! That's why they're selling some of it to reduce debt attracting an 8.5% average interest rate.
To be truthful though the lack of voting control these 'a' shares have is silly and may deter buyers.
Tell that to Google and Apple. Two of the biggest and best run companies around with Zero debt. The importance is not debt or equity.
The importance is cost v risk. There are far more certain risks (and costs) of debt that equity does not have.
..
Thats just a figure to test for interest. If the buyers are there it will go the full amount of the debt. If I was an investor I wouldn't touch these shares though.
The club has no equity.
The Glazers own it all.
The debt has a charge against the equity but again that is not the clubs charge it is the banks who lent the money.
The more the debt goes down expect the glazers to take out more money from the club to finance whatever the feck they want.
Exactly my point.
Oh well. Not quite as good as I had originally thought!
Come again?
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