ALL issues relating to the bond issue and club finances

[Number7]

I've never actually understood what's in it for the Glazers?

They're 4 years in nearly, and would have posted a £30million loss, this on the back of winning the European Cup and League Title, and having the worlds best player. They obviously knew there was going to be huge levels of debt, we all seemed too.

Surely they aren't planning on sticking around 20/30/40 years? What are the chances of them calling it a day after failing to capitalise on the most successful of seasons?

I never understood that from day one tbh, not to mention the damage this is doing for their global reputation as a whole, which will affect future business deals, surely.

 

[ralphie88]

The ownership of Manchester United's Carrington training complex could be transferred to a holding company controlled by the Glazer family and leased back to the club, according to the prospectus *circulated to potential investors in a £500m refinancing scheme this week.

Publicity publicity and more publicity, please. I don't care how sensationalist it is.

Unlike the Times's "worst fears" article a few posts above, this is NOT sensationalist, mate.

It's there in black and white. The Glazers are looking at gifting themselves United's training complex and then rent it back to the club. Meaning that when they sell - which now looks sooner rather than later - anyone buying the club will presumably need to either pay them rent or buy the training ground off them in addition to the club.

Isn't that called asset stripping? THAT was always our worst fear about the Glazers.

 

[esmufc07]

So we're selling our best players, now our training ground What next. Can they sell the stadium and lease it back?

 

[Number7]

My £101 in the Phoenix fund will pay for a set of 5 a side goalposts, if it helps.

 

[mariachi-19]

So they're going to take our training ground and lease it back to cover the shit heap, that they forced on to a club, that had no debt and owned Carrington and Old Trafford.

Starting to wish that they either refloated or fecked off.

 

[ralphie88]

So we're selling our best players, now our training ground What next. Can they sell the stadium and lease it back?

No, the Glazers wouldn't do that.*








* They can't, it's part of the security on their senior debt.

 

[Amir]

My £101 in the Phoenix fund will pay for a set of 5 a side goalposts, if it helps.

So will mine, so we can start thinking about Premier League level football.

 

[Ole'sbodyguard]

Has anyone got a link to this Prospectus or could PM me a copy?

I would like to read through this if possible as some of these proposals are what was muted back in 2005 as worst case scenario stuff.

 

[Number7]

Has anyone got a link to this Prospectus or could PM me a copy?

I would like to read through this if possible as some of these proposals are what was muted back in 2005 as worst case scenario stuff.

Isn't it 336 pages long?

 

[Ole'sbodyguard]

Isn't it 336 pages long?

Yep. I read long documents for a living, mate, I could get through that over a long period of time. The concepts and terminology might be out of my comfort zone but I am under the impression that as this is aimed at investors then it will be easier enough to get the basics of.

I've never got into this stuff before but I have seen links posted to the accounts in the past and other stuff.

 

[ralphie88]

Has anyone got a link to this Prospectus or could PM me a copy?

I would like to read through this if possible as some of these proposals are what was muted back in 2005 as worst case scenario stuff.

The prospectus - http://www.joinmust.org/docs/mufc-notes.pdf

And some ft commentary - http://www.joinmust.org/docs/longroom.pdf

 

[ooeat0meoo]

I'm telling you... this bond stuff is like selling searing hot stones to someone stranded on an ice berg. I say send it to the Harvard Law group that studied the predatory loan contracts of the past 10 years. I'd bet they would find it very interesting.

If anyone finds a link or copy let me know, I will send it to the Harvard Law students that study questionable junk bonds and the sort.

 

[ooeat0meoo]

The prospectus - http://www.joinmust.org/docs/mufc-notes.pdf

And some ft commentary - http://www.joinmust.org/docs/longroom.pdf

Holy crap!!! First page seeing all the banks involved - It's like a trifecta of the world's most fecked up and corrupt bankers and investment companies. (B or A, Goldman Sachs Int., and Royal Bank of Scotland) I know more details about the corruption of the first two, not as much about RBS. I do know they were restricted in the United States for dirty dealings, though.



Shooting this off to the Harvard Group, let you know if I hear anything.


Done, hoping for a response soon.

 

[hungrywing]

I'm telling you... this bond stuff is like selling searing hot stones to someone stranded on an ice berg. I say send it to the Harvard Law group that studied the predatory loan contracts of the past 10 years. I'd bet they would find it very interesting.

If anyone finds a link or copy let me know, I will send it to the Harvard Law students that study questionable junk bonds and the sort.

Would they get it back to us from their ivory tower in time to actually do something about it?

 

[ooeat0meoo]

Would they get it back to us from their ivory tower in time to actually do something about it?

Who knows... it's worth a try. If anyone considers themselves a true fan, they'd do as I did and email this to any and all legal groups that could analyze the proposal to see if it's a viable and legitimate bond proposal.


If it gets out into the media fast enough that it's a scam, the Glazers might be forced to withdraw the bond proposal.

 

[ralphie88]

If it gets out into the media fast enough that it's a scam, we might be able to stop it.

To be fair I think the media, in conjunction with both MUST and IMUSA, have been on to this from the start. With the exception of one shoddy piece of journalism from the Mirror, the UK press in particular have been quick to see through the smoke and mirrors.

But every little helps. :thumbsup:

 

[hungrywing]

3:24 PM EST Ok, I see the big 'H' symbol in the sky. (In the daytime we use pyrotechnic smoke charges, at night, an 'H' bat-signal) Off to prosetly- proseylti- oh that's not even the right usage.

3:31 PM EST Here we are discussing your intel. There are four of us right now. Out of ten total, two are respectively the son and niece of high-ranking executives in RBS and Goldman Sachs. The rest of us are in no way connected to anyone alive in any institution anywhere on the planet.

3:32 PM EST We decide to call those two and tell them it was a false alarm.

3:35 PM EST One of them walked through the door and we had to tell her that there was a seminar on Estate Tax going on and if she hurried she could catch the last fifteen percent I mean minutes.

3:36 PM EST That's a wonderful photo on page four. Congratulations on the three titles during you've won during your history.

3:48 PM EST Hmmm.

3:56 PM EST Dude, you're screwed. Unless you can come up with about 40 million Euros for a crack legal team that could possibly counter the one that these folks have on retainer. We can introduce you to some available parties who will in no way be indebted to any of us for the referral.

 

[Sir Matt]

Where's Batman or Superman to save us from the evil bastards when we need them? Hell, I'd take Scooby Doo and the gang if the meddling kids got the Glazers out.

 

[Twisted_Woody]

To be fair I think the media, in conjunction with both MUST and IMUSA, have been on to this from the start. With the exception of one shoddy piece of journalism from the Mirror, the UK press in particular have been quick to see through the smoke and mirrors.

But every little helps. :thumbsup:

So you are telling me this whole thing is a scam?

How....?

 

[VoetbalWizard]

if i were vidic or a player at united that wasn't united through and through, i'd take a look at this bond prospectus and say, feck this lark, i'm off to madrid or barca...

and i wouldn't blame them if they did.

 

[RK]

To be fair I think the media, in conjunction with both MUST and IMUSA, have been on to this from the start. With the exception of one shoddy piece of journalism from the Mirror, the UK press in particular have been quick to see through the smoke and mirrors.

But every little helps. :thumbsup:

How about a matchday song? If it were controversial enough it would get picked up on somewhere. And as you say every little helps, it's either that or just wait for the glazers to pull out.





Of our arses.

 

[AlwaysRedwood]

if i were vidic or a player at united that wasn't united through and through, i'd take a look at this bond prospectus and say, feck this lark, i'm off to madrid or barca...

and i wouldn't blame them if they did.

You mean they might leave before the Glazers sell them? Good luck with that.

 

[Rood]

Unlike the Times's "worst fears" article a few posts above, this is NOT sensationalist, mate.

It's there in black and white. The Glazers are looking at gifting themselves United's training complex and then rent it back to the club. Meaning that when they sell - which now looks sooner rather than later - anyone buying the club will presumably need to either pay them rent or buy the training ground off them in addition to the club.

Isn't that called asset stripping? THAT was always our worst fear about the Glazers.

At the moment it seems this move is more of a tax dodge - would be a bit like giving your house to your wife and renting it back from her - you can then claim the rent as an expense.

However, if they were to sell the training ground to someone else or keep if for themselves then I agree that this would be the worst thing the Glazers have ever done.

Isn't it 336 pages long?

No it is only 322 pages - get your facts right

 

[peterstorey]

No it is only 322 pages - get your facts right

And only mentions the PIKS once which is a bit naughty.

 

[theimperialinn]

Why not? The first tranche were paid off? The bit I don't get is how you can underwrite the bond issue with Man Utd assets which are already pledged against the existing debt? Unless the bond is simply a high-risk securitization of future gate receipts.

From what I can make out from the accounts the senior debt is secured against the fixed and floating assets of Red Football Ltd. If this debt is cleared then the bonds can be secured on them. The PIKs are secured against the shares of Red Football Ltd. Therefore the security just switches from the senior debt to the new bonds.

 

[peterstorey]

From what I can make out from the accounts the senior debt is secured against the fixed and floating assets of Red Football Ltd. If this debt is cleared then the bonds can be secured on them. The PIKs are secured against the shares of Red Football Ltd. Therefore the security just switches from the senior debt to the new bonds.

It's that timing mechanism I don't get. The security needs to be in place as the bond is launched but still needs to cover the senior debt until the bond is subscribed. Presumably there's some kind of underwriting and effectively a bank guarantee until the bond transaction is complete (or flops).

 

[theimperialinn]

It's that timing mechanism I don't get. The security needs to be in place as the bond is launched but still needs to cover the senior debt until the bond is subscribed. Presumably there's some kind of underwriting and effectively a bank guarantee until the bond transaction is complete (or flops).

I haven't a clue, I don't know the mechanics of these deals. I've just read the FT analysis of the prospectus. Looks like the Inland Revenue have asked a gew questions about the players image contracts and employers NIC. A potential litigation has been estimated at £5.5m from 2000/01 to 2008/09.

 

[Rood]

It's that timing mechanism I don't get. The security needs to be in place as the bond is launched but still needs to cover the senior debt until the bond is subscribed. Presumably there's some kind of underwriting and effectively a bank guarantee until the bond transaction is complete (or flops).

There is a whole load of banks listed on the first page as 'Joint Lead Managers': JP Morgan, BofA, Deutsche Bank, Goldman Sachs, RBS and KKR

So I guess they are underwritting it all.

 

[x42bn6]

Can't see it's been posted before, so here's the prospectus: http://i.dailymail.co.uk/pdf/ManUtdProspectus.pdf

 

[sammsky1]

Glazers' self-interest weighs United down

Gabriele Marcotti
January 13, 2010

TheGame - Times Online - WBLG: Roger Johnson shows tactics may hide potential


Oli Kay writes about United's bond issue and I'm reminded of the absurdity of allowing the Glazers to do what they did. They turned the world's most financially successful club, one that turned a profit every year, into a monstrously indebted entity, while paying themselves £10 million in fees and borrowing another £10 million from the club. And, through it all, once the media got bored with the story, once the majority of United fans (with the exception of organisations such as the Manchester United Supporters' Trust and a few others) were lulled into a sense of security by success on the pitch and once the Premier League decided there was nothing it could do (or, probably, wanted to do), nobody did a thing.

Let's put this another way. Since 2005, United have spent more than £325 million in interest payments. Before 2005, they spent virtually nothing, because they were virtually debt free. Here's a little game you can play. How could that £325m have been better spent? Could it have been used to limit the increase in ticket prices, which have nearly doubled since the Glazers' arrival? Could they have been used to strengthen the squad and win more silverware?

That's the bottom line. These people bought the club, added little to it — last time I checked, David Gill and Sir Alex Ferguson were still running things — took millions out of it for themselves and had to give hundreds of millions of United's money to the banks.

"If it were a race, then United are dragging their owners behind them like a broken tractor, while City's owners are providing rocket fuel, " wrote Duncan Drasdo, chief executive of the Manchester United Supporters' Trust. "It just shows what a fantastic job Sir Alex and the players have done that we are still ahead despite the deadweight of the Glazers' ownership. Manchester United doesn't need a sugar daddy. We just need to get rid of the leeches."

 

[Rahul]

Theres only one bond that can fix this.

 

[RedCanuck]

I've never actually understood what's in it for the Glazers?

I wanted to post on the topic so I'm taking this opportunity Number. I've been inundated with the doom and gloom from the press so I went and took a look at some numbers.

Whatever can be said about the Glazers, I doubt that they are stupid. Considering they invested 275 million pounds of their own money into the original purchase its doubtful they don't have a good handle on the financial aspects of the club. That money would have bought any other team lock stock so taking a leveraged position as they did must have some logic.

Whatever else we think of the Glazers, they took advantage of a great business opportunity. The PLC left too much money on the table. The Glazers saw they could substantially increase revenues that were unrealized under the PLC. Unfortunately for ST holders they took the biggest hit, but increases in capacity at OT, new sponsorships etc have seen the clubs revenues increase substantially since they took over. According to Deloitte's estimates the revenue (excluding player sales) in 2005 was 246 million euros. In 2008 those same revenues were 325 million euros. That represents a 32% increase.

You can download the Deloitte report here:
Deloitte Football Money League 2009 | Sport Business Group | Deloitte UK

I've read reports this week that wages as a percentage of revenue at United are on the order of 45%. That is consistent with where it has been in the past and is the envy of every other club in the world.

Add it all up and the fact remains that United are in great shape as an operating business.

What I would really like to find out from the Harvard Group are the implications of the Estate Tax on the Glazers holding of the Tampa Bay Buccaneers. Would not surprise me in the least if they sold up that club when the Estate Tax is due on that capital gain.

 

[Crerand Legend]

Interesting points, sometimes it hard to know what to believe

 

[B Cantona]

Glazers' self-interest weighs United down

Gabriele Marcotti
January 13, 2010

TheGame - Times Online - WBLG: Roger Johnson shows tactics may hide potential


Oli Kay writes about United's bond issue and I'm reminded of the absurdity of allowing the Glazers to do what they did. They turned the world's most financially successful club, one that turned a profit every year, into a monstrously indebted entity, while paying themselves £10 million in fees and borrowing another £10 million from the club. And, through it all, once the media got bored with the story, once the majority of United fans (with the exception of organisations such as the Manchester United Supporters' Trust and a few others) were lulled into a sense of security by success on the pitch and once the Premier League decided there was nothing it could do (or, probably, wanted to do), nobody did a thing.

Let's put this another way. Since 2005, United have spent more than £325 million in interest payments. Before 2005, they spent virtually nothing, because they were virtually debt free. Here's a little game you can play. How could that £325m have been better spent? Could it have been used to limit the increase in ticket prices, which have nearly doubled since the Glazers' arrival? Could they have been used to strengthen the squad and win more silverware?

That's the bottom line. These people bought the club, added little to it — last time I checked, David Gill and Sir Alex Ferguson were still running things — took millions out of it for themselves and had to give hundreds of millions of United's money to the banks.

"If it were a race, then United are dragging their owners behind them like a broken tractor, while City's owners are providing rocket fuel, " wrote Duncan Drasdo, chief executive of the Manchester United Supporters' Trust. "It just shows what a fantastic job Sir Alex and the players have done that we are still ahead despite the deadweight of the Glazers' ownership. Manchester United doesn't need a sugar daddy. We just need to get rid of the leeches."

Bah this puts me in a spot, because I think Marcotti is one of the worst pundits out there. Cant fault anything he's said there though

 

[hungrywing]

Theres only one bond that can fix this.

We can't afford him.

 

[kietotheworld]

Glazers' self-interest weighs United down

Gabriele Marcotti
January 13, 2010

TheGame - Times Online - WBLG: Roger Johnson shows tactics may hide potential


Oli Kay writes about United's bond issue and I'm reminded of the absurdity of allowing the Glazers to do what they did. They turned the world's most financially successful club, one that turned a profit every year, into a monstrously indebted entity, while paying themselves £10 million in fees and borrowing another £10 million from the club. And, through it all, once the media got bored with the story, once the majority of United fans (with the exception of organisations such as the Manchester United Supporters' Trust and a few others) were lulled into a sense of security by success on the pitch and once the Premier League decided there was nothing it could do (or, probably, wanted to do), nobody did a thing.

Let's put this another way. Since 2005, United have spent more than £325 million in interest payments. Before 2005, they spent virtually nothing, because they were virtually debt free. Here's a little game you can play. How could that £325m have been better spent? Could it have been used to limit the increase in ticket prices, which have nearly doubled since the Glazers' arrival? Could they have been used to strengthen the squad and win more silverware?

That's the bottom line. These people bought the club, added little to it — last time I checked, David Gill and Sir Alex Ferguson were still running things — took millions out of it for themselves and had to give hundreds of millions of United's money to the banks.

"If it were a race, then United are dragging their owners behind them like a broken tractor, while City's owners are providing rocket fuel, " wrote Duncan Drasdo, chief executive of the Manchester United Supporters' Trust. "It just shows what a fantastic job Sir Alex and the players have done that we are still ahead despite the deadweight of the Glazers' ownership. Manchester United doesn't need a sugar daddy. We just need to get rid of the leeches."

That doesn't take into account dividends paid to shareholders pre-2005.

 

[mariachi-19]

Whats in it for the Glazers as mentioned, is that £325 million thats been paid in interest. If they can find a way to pay off the debt and leave us debtless, the return is massive. United would only need £150 million of that amount to remain as one of the most successful clubs in the world and $285 million in profit for the glazers for 5 years work is over $57milllion annually. Thats nearly double what they've taken out of the club every year 'which really puts it in to perspective how piddly that £20 million is'.

 

[Red Indian Chief Torn Rubber]

That doesn't take into account dividends paid to shareholders pre-2005.

Indeed.

 

[Number7]

I wanted to post on the topic so I'm taking this opportunity Number. I've been inundated with the doom and gloom from the press so I went and took a look at some numbers.

Whatever can be said about the Glazers, I doubt that they are stupid. Considering they invested 275 million pounds of their own money into the original purchase its doubtful they don't have a good handle on the financial aspects of the club. That money would have bought any other team lock stock so taking a leveraged position as they did must have some logic.

Whatever else we think of the Glazers, they took advantage of a great business opportunity. The PLC left too much money on the table. The Glazers saw they could substantially increase revenues that were unrealized under the PLC. Unfortunately for ST holders they took the biggest hit, but increases in capacity at OT, new sponsorships etc have seen the clubs revenues increase substantially since they took over. According to Deloitte's estimates the revenue (excluding player sales) in 2005 was 246 million euros. In 2008 those same revenues were 325 million euros. That represents a 32% increase.

You can download the Deloitte report here:
Deloitte Football Money League 2009 | Sport Business Group | Deloitte UK

I've read reports this week that wages as a percentage of revenue at United are on the order of 45%. That is consistent with where it has been in the past and is the envy of every other club in the world.

Add it all up and the fact remains that United are in great shape as an operating business.

What I would really like to find out from the Harvard Group are the implications of the Estate Tax on the Glazers holding of the Tampa Bay Buccaneers. Would not surprise me in the least if they sold up that club when the Estate Tax is due on that capital gain.

Cheers.

I know we've seen increased revenue, but how much is negated by the interest repayments? Surely there isn't too much room for this to grow....attendences have probably fallen a fair bit this season for example, and we've jsut signed the new shirt deal.

We keep announcing new sponsorship deals...when does this start becoming unattractive through the numbers of sponsors we have?

 

[Sunny Jim]

Sold Trafford: Glazers ready to sell Manchester United's home to ease crippling debtBy Ian Ladyman
Last updated at 12:25 AM on 14th January 2010
Comments (0) Add to My Stories Manchester United's debt-ridden owners the Glazers have for the first time raised the previously unthinkable prospect of selling Old Trafford.

The American family had steadfastly refused to consider such a controversial move since they plunged the club into debt when taking it into private ownership in 2005.

But in the prospectus sent out to potential investors ahead of a £500million bond issue, the Glazers have warned that ‘the indenture governing the Notes (bonds) will limit our ability to sell or transfer, but not prohibit us from selling or transferring our training ground facilities and our stadium.’
Up for grabs? The Glazers' prospectus reveals they could sell Old Trafford

The prospectus also reveals that:

The club has none of its own money for new players.

United may have to SELL players to service the debt in the future.

The Glazers may have to refinance AGAIN in the near future.

The club has already drawn down a £36m cash advance on an £80m four-year shirt sponsorship deal that doesn’t begin until the summer.

Burden of debt: United owner Malcolm Glazer

Fears about Old Trafford will concern fans the most, however, with many suspecting that the Glazers intend to sell and then lease back United’s famous stadium and the state-of-the-art training ground at Carrington.

Ever since the Glazers bought their club, United supporters have suspected that the ground would one day be sold or, at the very least, renamed.

In a section of the prospectus headlined ‘risks related to our debt’, investors are warned: ‘Although in the sale or transfer of any of these properties, the transferee will be required to enter into a long-term lease with us to enable us to continue to have substantially the same access to such property as we currently do, if we sell or transfer either or both of these properties, we will no longer control them.’

It is understood the Glazers are required by law to outline all possible risk to potential investors in the document.

It is also the case that the Carrington training centre is much more likely to be sold as the family have deliberately not secured any of their credit facilities against it, as they have with the stadium.
Nevertheless, industry experts last night stressed that using Old Trafford as security in this latest round of refinancing does not offer the stadium any particular protection against its sale in the future.

As regards Carrington — opened 10 years ago — it appears its future is in genuine doubt as the document reveals it ‘may in due course be transferred to a holding company or affiliate of the Parent. In the latter event, we will be granted a lease’.

Figures show that United have not spent a net penny on player transfers for three years. Manager Sir Alex Ferguson is likely to have to dip in to a new £75m credit facility if he is to spend more than he can raise through sales this summer.



Read more: Sold Trafford: Glazers ready to sell Manchester United's home to ease crippling debt | Mail Online

sorry if it was posted before


anyway