On a serious note, I think the following is clear about the take over process.
1. Anyone can gain 100% of the control of the club and 69% of the economic rights by buying all of the shares held by the Glazers.
By doing this, you gain the exact same control of the club as the Glazers has today.
The current bid from 9-2 for the Glazers shares is £2.9bn. So anyone that want to get the same control and ownership of the club as the Glazers can outbid 9-2 if they pay more than £2.9bn. In addition 9-2 pledges to invest 1bn into the club according to reports.
So in essence, from the Glazers and fans of MUFC’s point of view, 9-2’s bid for the club is slightly lower than what Boehly paid for, and pledged to invest in, Chelsea. Boehly paid 2.5bn for the club and pledged to invest 1.75bn in the club, for a total of £4.25bn. 9-2’s bid to the Glazers is £2.9bn and they pledge to invest a billion, so in total 3.9bn.
In addition, they would also seek to buy the shares listed on the NYSE for app. 1.3bn.
But overall I think it’s quite clear that 9-2 is not QSI and that this is a project they have a fairly limited budget for. The Glazers has picked an awful time to sell the club from a macro economic point of view, with interest rates sky rocketing etc. But remember that Saudi Arabia made a bid for Chelsea but didn’t even get through to the second round, just because a bidder origins for an oil state, it doesn’t mean that they have unlimited funds. It could also be that Sheik Jassim’s position took a big hit from Credit Suisse going bust. Qatar was the biggest share owner of Credit Suisse and Sheik Jassim was on CS’ board
2. Ineos bid to the Glazers is for all their shares for app. 3.5bn, ie valuing the club at close to 6bn (at the bottom line, this means 600m more for the Glazers, but they won’t get all immediately). According to information in the FT — the purchase price would be paid to the Glazers in tranches. Ie they would sell shares representing a controlling stake (more than 50% of the series B shares) in the first tranche and then the rest over the coming “years”. What is new in the FT article is that they intend to change to AoA so that others than the Glazers can own B shares. If no such change is made, the voting strong B shares would convert to A shares if sold to a non Glazer.
If Ineos comes out on top, it’s after a pretty modest bid. Remember they offered to pay just as much as Boehly for Chelsea (after the deadline), ie £2.5bn for the club and Ineos also pledged to invest £1.75bn in Chelsea’s squad and stadium. With this bid, Ineos would have to pay a little more, to get a little less (69%), of something a lot bigger MUFC. Hopefully the £1.75bn investment figure still stands, it’s a figure that should make us the club that can invest the most in our squad in the world over the coming decade.
3. The Glazers obviously seem very intrigued by 9-2 and are dragging out the negotiations with Ineos to give 9-2 time to raise their offer. The process aimed to finish in late March, and after that two “deadlines” has passed without a preferred bidder being appointed.
Will 9-2 come back with an improved offer? Like many surely will remember, I had “Qatar” as my favorite back in November/December before either of 9-2 or Ineos even had declared their interest. And while it’s hard to get full insight into how business is done in these countries, we know enough to conclude that it is perfectly possible for them to be irrational, but when they say something, they deliver (with ‘they’’, I mean Sheik Jassim, not some Twitter account with Arabic text in the bio). Before anything is done, sealed and delivered with Ineos — I wouldn’t rule anything out.
But with this said — “11.59 pm” has passed three times already in this process. We are into June 4 (possibly 5 before I hit send). If Jassim like have told Avram ‘give me a call before you close with someone else’, Avram’s phone bill to Qatar is probably pretty significant by now…
The FT article obviously came from either top of the Raine Group or one of the other central advisors. Reading between the line, they are basically ridiculing the 9-2 bid. Talking about it in terms of how “serious it is”, the “penny dropping” regarding key elements, and so forth. They obviously also feel that Ineos really is playing hard ball.
So I don’t know what to think. Anyone wanting to hold out hope for 9-2 should be able to do so — nothing is a done deal yet — but objectively, the only thing they have going for them is Avram holding off appointing Ineos the preferred bidder.
4. Given that 9-2 obviously doesn’t have unlimited resources for this project (under normal conditions, I don’t think it’s a bid that make it to the second round of bids, it’s Chelsea money for a lot bigger club in MUFC) — should we be worried that they will buy the club and then not invest enough? I doubt it. We know practically nothing for certain about either bidder, but I think both alternatives would provide sufficient resources for us to be the No 1 in the football world in terms of financial resources. Like anything else is bad business.
It does feel like many think that 9-2 is a safer bet to invest more into the club — what is the basis for that? Is there a logic in assuming that since QSI got PSG for free and then invested 2bn into the club, 9-2 will buy MUFC for 6bn and then invest 2-3bn into the club? Maybe, I don’t know. But is it a certainty? Anyone claiming that must know something I don’t.
5. I want to add one last thing, we are a long way into the process. Like we talked about above, the economic climate this spring has been a nightmare. Big banks going bust, interest rates skyrocketing, a war in the middle of Europe and tension between Russia and NATO, asset prices tanking completely — and so forth. Had the club been sold during the fall of 21’ when the stock market went crazy, there certainly would have been interest from SPACs, crypto players, and other super high net worth individuals.
Ineos and 9-2 announced their interest what, I’ve lost track of time, but like 5-6 months ago. Recession is looming. But investors are about one year ahead of reality. Even if the 6 worst months are ahead of us, it will start to look up a few months into 2024. Inflation won’t survive a recession and the world’s problem — which we are aware of today — aren’t bad enough to sink the world economy for any longer period of time.
Investor just have two modes, they are either panicking and are on suicide watch or they have blinders on and try to get their hands on as many assets as possible.
With more and more investors starting to get their head above water so to speak — I wouldn’t at all be shocked if a third bidder comes in and just swoops up the club. If so, probably an US consortium, perhaps even some Asian investors. The current bids — 2.9 and 3.45bn to the Glazers (this is of course all that matters) — just isn’t that much for a club like MUFC.
