ALL issues relating to the bond issue and club finances

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theimperialinn said:
A few points here:

We had cash reserves of £116m pre-bond issue.

I reckon we probably have about £45m post bond issue and a £75m loan facility.

Carrington is going nowhere - it's to be sold inter-group.

If anyone bought United Carrington would form part of the deal.

Gill talked about a long term lease and a 'peppercorn rental' meaning it would be of no use to the Glazers on it's own and this jig is purely for tax and cash management purposes.

The bond actually says that money can be transfered from Red Football Ltd to the holding company to clear it's indebtness - the piks.

The Glazers cannot pay themselves a dividend until the group figures start realising a profit
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On this point, I have to intervene.

If they were to create a company, and sell Carrington to that company for a nominal fee, then that company can in turn charge United rent to use Carrington.

What that company does with that rent bears no relevance to Manchester United or the debts. Its a company in its own right.

Because the Glazers would own that company, any rent coming in for Carrington would be theirs and theirs alone, and they wouldnt have to use that to pay any debts off. It is simply them paying themselves their own money via the back door.

Or in other words, getting it out of United without anyone asking any awkward questions as to where its going and why its not being used to clear off the debt.

The more I read about this bonds issue, the more I suspect that the Glazers are going to be siphoning more and more out of United without it appearing that they are getting it.

People will see RENT FOR CARRINGTON on the club accounts.
They will see consultancy fees
They will payments going to firms for work done at United

All the time those payments are going to the same person. Glazer..

You are 100% correct that they cannot pay themselves a dividend.. but they sure as hell can pay themselves in other ways....
 
fredthered said:
On this point, I have to intervene.

If they were to create a company, and sell Carrington to that company for a nominal fee, then that company can in turn charge United rent to use Carrington.

What that company does with that rent bears no relevance to Manchester United or the debts. Its a company in its own right.

Because the Glazers would own that company, any rent coming in for Carrington would be theirs and theirs alone, and they wouldnt have to use that to pay any debts off. It is simply them paying themselves their own money via the back door.

Or in other words, getting it out of United without anyone asking any awkward questions as to where its going and why its not being used to clear off the debt.

The more I read about this bonds issue, the more I suspect that the Glazers are going to be siphoning more and more out of United without it appearing that they are getting it.

People will see RENT FOR CARRINGTON on the club accounts.
They will see consultancy fees
They will payments going to firms for work done at United

All the time those payments are going to the same person. Glazer..

You are 100% correct that they cannot pay themselves a dividend.. but they sure as hell can pay themselves in other ways....
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Buying the complex in the first place would mean they have to put money into the club and then take a peppercorn rent.

We all know that's not going to happen which is why I think the complex would be sold inter-group - most likely RFSH or RFJV rather than a sale to a company outside the group.
 
There is going to be a massive tv deal for next season. Which is rumoured to be an additional 50 million pounds per team. If that's true utd's worth will go through the roof and the glazers will reject even the most lucrative of offers if it came.
 
GAngel said:
There is going to be a massive tv deal for next season. Which is rumoured to be an additional 50 million pounds per team. If that's true utd's worth will go through the roof and the glazers will reject even the most lucrative of offers if it came.
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I think it's 25% on what we get already.

I read earlier that season tickets sales were down from 65,000 to 58,000 this season.

I reckon next season will be even worse when you take into account the recession and boycotters.

I wouldn't be surprised if we only had 50,000 for 2010/11.
 
theimperialinn said:
I think it's 25% on what we get already.

I read earlier that season tickets sales were down from 65,000 to 58,000 this season.

I reckon next season will be even worse when you take into account the recession and boycotters.

I wouldn't be surprised if we only had 50,000 for 2010/11.
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I don't see a 20% drop in season tickets in one season. Not unless we were relgated. And the new shirt sponsor money + a few other deals more than make up for it. Utd's income will rise again next year which makes the worth of the club inflate regardless. If i were in the glazers position I could make it work and they have far better money men than me. How else could they steal the club for free.
 
GAngel said:
I don't see a 20% drop in season tickets in one season. Not unless we were relgated. And the new shirt sponsor money + a few other deals more than make up for it. Utd's income will rise again next year
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Even with the new TV deal it's possible it will fall next season. This season we've had the Ronaldo money and have also had an £35m up front payment for the new shirt sponsorship deal. And, of course, we may not make the CL final.
 
GAngel said:
I don't see a 20% drop in season tickets in one season. Not unless we were relgated. And the new shirt sponsor money + a few other deals more than make up for it. Utd's income will rise again next year which makes the worth of the club inflate regardless. If i were in the glazers position I could make it work and they have far better money men than me. How else could they steal the club for free.
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They already had that last year.
 
GAngel said:
I don't see a 20% drop in season tickets in one season. Not unless we were relgated. And the new shirt sponsor money + a few other deals more than make up for it. Utd's income will rise again next year which makes the worth of the club inflate regardless. If i were in the glazers position I could make it work and they have far better money men than me. How else could they steal the club for free.
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I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If the Tories get in we are likely to slide back into recession as well once they start chopping into the public finances.
 
theimperialinn said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If the Tories get in we are likely to slide back into recession as well once they start chopping into the public finances.
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We are going back into recession no matter WHO gets in. The .01% growth was just a blip.
 
theimperialinn said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If the Tories get in we are likely to slide back into recession as well once they start chopping into the public finances.
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Not to mention the Wembley ticket issue showing that loyalty gets you bugger all and with tickets being available for almost all home games via OU membership the only real gain to having a ST is to have the same seat for every game and being guaranteed tickets for the big games.

When weighed against the ACS scheme a ST is looking less and less like a worthwhile purchase.
 
theimperialinn said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If the Tories get in we are likely to slide back into recession as well once they start chopping into the public finances.
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I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If Labour get in we are likely to slide back into recession as well once they start chopping into the public finances
 
topper said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If Labour get in we are likely to slide back into recession as well once they start chopping into the public finances
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The recession will cause a drop again no doubt. The "Glazer problem" will only cause a further drop if there is a widespread call for a boycott by the supporters groups. I take it you are a David Cameroon supporter but the constraints of this recession are such that it wont make any difference who gets in
 
topper said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If Labour get in we are likely to slide back into recession as well once they start chopping into the public finances
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Because Labour will cut deeper than the Tories?

Stick to football, you don't understand politics.
 
topper said:
I think it's extremely possible that ST's could drop by a further 20%.

Given the current climate at OT and the amount of people struggling with the recession.

If Labour get in we are likely to slide back into recession as well once they start chopping into the public finances
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A bizarre statement considering it'd be widely regarded as highly i/unaccurate.
 
711 said:
Because Labour will cut deeper than the Tories?

Stick to football, you don't understand politics.
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and you do?



the counties finances are fecked (proportionally far worse than even the glazers have managed with United) so who ever is in power will have to both increase taxes and cut spending for at least the next parliament all of which will have an increasing effect on supporters ability to pay.
 
M13_RED said:
Because Gill slips and slides his way out of it. He doesn't answer a single question with a straight or factual answer.
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Drifter said:
Gill will only come out with his usual prepared spin
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Yes but surely it's better to highlight the flaws of his stance by letting him answer it with his usual spin to illustrate how clueless he actually is, rather than say repeatedly retell what he said in 2004, there was a good opportunity there missed to open the wound up and yet Gill came off as if he wasn't being allowed to speak and you can guarantee that's the best thing for Gill as, as you've pointed out, when he does speak he only digs himself further into the mire.
 
Crerand Legend said:
The recession will cause a drop again no doubt. The "Glazer problem" will only cause a further drop if there is a widespread call for a boycott by the supporters groups. I take it you are a David Cameroon supporter but the constraints of this recession are such that it wont make any difference who gets in
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Exactly the point I was making :D but yes I do prefer Cameroon to Clown ;)
 
AdZzUtd said:
Yes but surely it's better to highlight the flaws of his stance by letting him answer it with his usual spin to illustrate how clueless he actually is, rather than say repeatedly retell what he said in 2004, there was a good opportunity there missed to open the wound up and yet Gill came off as if he wasn't being allowed to speak and you can guarantee that's the best thing for Gill as, as you've pointed out, when he does speak he only digs himself further into the mire.
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The intention of the guy that asked the questions was to see what he would say when confronted with his own quotes, and how he's since gone back on them. He asked the question and the first thing that came out of Gill's mouth was a lie 'when said in context' or whatever he said. We all know the context, he even suggested that if he were in our shoes he would be sat on the picket lines. There was no 'lack of context' about it, Gill went back on his word and is now trying to lie his way out of it - he needs to be shown up for what he is, and people will still see this even though it was spur of the moment confrontation, and well done to the lad.

I can't imagine how I would conduct myself in his situation. All rationale and prior plans would fly out of the window and I'd just babble myself into a rage.
 
RedPhil1957 said:
and you do?

the counties finances are fecked (proportionally far worse than even the glazers have managed with United) so who ever is in power will have to both increase taxes and cut spending for at least the next parliament all of which will have an increasing effect on supporters ability to pay.
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I quite agree, whichever party wins will have to cut spending and that obviously will put downward pressure on ticket sales.

However that's not what Topper said - he said 'if Labour get in they will start chopping public finances'.

You are correct, Topper was wrong.
 
711 said:
I quite agree, whichever party wins will have to cut spending and that obviously will put downward pressure on ticket sales.

However that's not what Topper said - he said 'if Labour get in they will start chopping public finances'.

You are correct, Topper was wrong.
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:D read my post and the one that I copied it from - then see difference between the two then ...the important bit.... engage brain and then have a good laff ;)
 
topper said:
:D read my post and the one that I copied it from - then see difference between the two then ...the important bit.... engage brain and then have a good laff ;)
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Whoops, you're right, I hadn't read Imp's post, it was him that started it off and he was wrong, not you.

My apologies Topper (on this occasion, without prejudice).
 
topper said:
:D read my post and the one that I copied it from - then see difference between the two then ...the important bit.... engage brain and then have a good laff ;)
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is this right?-

"For every pound supporters spend between now and 2017, the Glazers will suck out 79 per cent in debt interest, dividends and ‘management’ fees."

Oh! and vote tory, feck yourself twice over.
 
Glazers To Suck Out a Further Half a Billion From Man Utd, Or 70p in Every Old Trafford Pound | Pitch Invasion

Glazers To Suck Out a Further Half a Billion From Man Utd, Or 70p in Every Old Trafford Pound

Posted by Tom Dunmore on 1/22/10 • Categorized as Politics and Economics

We’re sorry that it has been all Manchester United debt all the time this week, but it’s been a key topic we’ve addressed here for years, and it’s both sad and shocking to see every last concern about the club’s future under the ownership of the Glazers realised as their refinancing effort has been put under the microscope.

What has been difficult for those of us with no training in the deliberately obscure arts of high finance wizardry is to understand in plain language what the Glazers’ latest bond issue means for Man Utd, both in explaining the state of the club’s finances (which have never before under the Glazers had to be so openly explained in the fine print of the bond issue’s prospectus) and in what the future holds now.

The best source has been the Financial Times, and one post on the Alphaville blog brilliantly dissects the situation and puts the numbers into language we can all understand, and which might make United fans throw up in their throats.

To put it plainly: the equivalent of 70% of all matchday income is going to pay the interest on the debt from the Glazers’ takeover, to go out as dividends to the Glazers (!) and to be spent on “management fees and expenses” to the Glazers, which will total over half a billion pounds at the minimum (at current profit levels) by 2017.

So even if the club continues to run an operating profit for the next seven years — which will be dependent on continuing successful performance at the highest level — the club will likely be saddled with the same amount of debt by 2017 and the Glazers will have sucked out half a billion pounds from the club. Even if the club somehow makes a lot more money than expected, half of that will go to the Glazers as well. Oh, and if the club spirals downward and operating profit no longer covers these costs, the bond issue allows the Glazers to sell off assets including Old Trafford to pay down their own debt.

Read the whole thing for the full explanation, but the crux of the matter is as follows:

The small print of Red Football Ltd’s bond prospectus shows that the Glazers have structured the issue to allow them to take at least £20m of dividends out of the club every year. An additional, so far unnoticed, clause allows a further £25m to be paid out in dividends at any time. Add these payments to the £70m already known about, the Carrington deal and “management fees” and at least £220m of the club’s cash will flow directly to the Glazers between 2010 to 2017.

With interest on the bonds and the extra cost of leasing our training ground back, the total that will be sucked out of the club between now and 2017 will exceed half a billion pounds, to add to the huge cost already imposed by the Glazers.

Let’s go over that again. The small print of the bond issue means that the Glazers get to suck out 50% of Consolidated Net Income from the club every year; if profits hold steady, that’d be £23m a year until 2017.

In fact, this bond issue is deliberately structured in such a way, that (assuming they can hold profits where they are) this is the minimum sum they can take each year. If there is any rise in profits from better TV deals or higher prices for supporters, half the extra money can be paid out in dividends.

Adding management fees, expenses and the interest on the bonds, every year 79% of the operating profits of the club will be taken out.

Or perhaps we should turn it around the other way and look at it from the fans’ point of view because this outflow is no less than 70% of all United’s matchday revenues. 70 pence from every pound spent by supporters on match tickets, food and drink, programmes, even car parking, and 70 pence from every pound spent on corporate boxes and executive facilities will go straight out of the door in dividends, fees and interest.

79% of the operating profits taken out. Or what amounts to 70% of matchday revenue, the money fans are directly spending at Old Trafford.

And the kicker?

By 2017, despite having pumped more than half a billion pounds out of Manchester United, the club will still be saddled with the £500m of debts it has today.

Many supporters, commentators and people in the wider football world have been astonished by the revelations concerning the Glazers ownership of Manchester United that have come to light in the last week.

This paper demonstrates that the pillaging of the club over the last four years by the owners is set to continue and indeed accelerate in the years to come. Nobody can be in any doubt; not the fans, the Football Association, the Premier League, UEFA, the government or indeed the manager or players that what is being allowed to happen is nothing less than a violent assault on one of Britain’s best known sporting institutions. There can no longer be any excuses by the football authorities to not immediately and urgently intervene (through rule changes if necessary) to prevent people, who have no interest in football beyond their own greed, from acting in this way.
 
Red Defence said:
All balls and no brains. That's the way to go.

Anyway what good would resigning have done? Wouldn't have helped him or United.
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It would have probably put unbelievable pressure on the Glazers, and really kick started protests from the fans a long, long time ago. If the apathetic fans we have to deal with saw the Chief Executive resigning, there'd be no doubt about it in everyone's eyes; things would need to be done.
 
M13_RED said:
I forgot that you had an advanced knowledge of internal affairs from your office in Israel :rolleyes:.
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Don't be a dick.

If you've got nothing constructive to say don't say anything at all, and that wasn't constructive.
 
Brwned said:
Don't be a dick.

If you've got nothing constructive to say don't say anything at all, and that wasn't constructive.
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So blind statements are constructive?

Gill opposed this takeover 5 years ago, saying it was too aggressive.
If and it was a big if, the Glazers had managed to secure individual TV rights we'd have been creaming it in and not worrying. It was a massive (sorry) part of their plan. Plan B was suck us dry and we'll end up looking like the tits of a 67-year-old whore.
 
ralphie88:

Has there been any discussion about a petition or generic email explaining supporter anger about the general inaction of those at the highest levels of both football and government concerning the state of football finances and the case for excluding sports teams from much of the thinking about private business ownership (for obvious reasons)?

I would be willing to set one up, although, ideally, it would be preferable if it was available through one of the supporters groups, because they can automatically email all members and ask them to forward it to their MP.

Though I am not convinced that politicians are really that interested, particularly in an election year, I was pleasantly surprised when I sent a strong email to my MP about the inhuman treatment of United supporters in Rome a few year ago. Politicians only act when they come under pressure to do so, and this surely has to be the right time to apply that pressure, given the financial state of clubs in this country.
 
M13_RED said:
I forgot that you had an advanced knowledge of internal affairs from your office in Israel :rolleyes:.
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What will attacking Gill do? Drive the Glazers away? All it MIGHT do is drive Gill away, so they'll just bring in their own 'suit'. Nothing gained.
 
711 said:
Whoops, you're right, I hadn't read Imp's post, it was him that started it off and he was wrong, not you.

My apologies Topper (on this occasion, without prejudice).
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No problem mate but sunshine below hasn't got the brains to do what you did


robertsoncrusoe said:
is this right?-

"For every pound supporters spend between now and 2017, the Glazers will suck out 79 per cent in debt interest, dividends and ‘management’ fees."

Oh! and vote tory, feck yourself twice over.
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I'd stay of the weed n/and/or booze mate - you don't seem capable of handling it :D
 
M13_RED said:
It would have probably put unbelievable pressure on the Glazers, and really kick started protests from the fans a long, long time ago. If the apathetic fans we have to deal with saw the Chief Executive resigning, there'd be no doubt about it in everyone's eyes; things would need to be done.
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Don't think the apathetic fans would have bothered any more than they did. To them a CE resigns and you just get a new one. Life goes on.

To be fair though there was an awful lot of aggression out there towards the Glazers anyway, it was a very fractious time, but a lot ignored it and couldn't be bothered. The Glazers were relatively unconcerned by the animosity towards them, they were on the way to owning the biggest club in the world and that was alll that mattered.

Gill resigning might have made some feel better temporarily but it wouldn't have done any good in the long run. He could see that and so could we. The Glazers would just have put their own man in. We didn't want that.
 
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