Should United be a Plc.?

[Neil Thomson]

Kenyon said yesterday:
"I am not sure why most football clubs went public in the first place,

"They have not changed their management structure. They have not demonstrated that they can manage costs. They have not demonstrated that they can be anything other than a football clubs.

"There is huge uncertainty and all those things are not what the City like to invest in. They don't like shocks. They don't like great peaks and troughs, and football as an industry gives you that."

 

[Dans]

When a company's value fluctuates between 1bn and 250m that is a good question Thompsun.

 

[Neil Thomson]

The share price fell 5p afterwards, about 5% - was there a hint in there of a buyout?

 

[pathfinder]

Martin Edwards was/is a very good buisnes man, and i wasnt happy when he gave it all up. He built the best buisnes in the world off football by a mile. I just hope it stays that way.

 

[Fergiesarmy]

Martin Edwards is a cnut whose genious business skills included tying to sell a club for 10 million, less than 10 years before it was valued it a billion.

 

[thumper]

Thats what his share was worth at the time though, the value only truly leapt when SKY came in and UTD were more accessable to millions nmore potential supporters as well as all the TV money and opportunities it opened up. As a shareholder I'm happy that we are a PLC as the club cannot splash money around left right and centre and end up like Leeds/Chelsea etc . Imagine how much debt we'd be in after spending £90million in the last 2 seasons. As a footie fan I wish they'd release more cash for strengthening but the fact that my club is financially secure, the richest in the world and probably the best run club in the world far outweighs any other objections I'd have.

 

[Rams]

United are the only club where it makes sense to be a plc. We are the only club who rely mostly on it's merchandising (rather then tv money etc.) for it's income. In that respect we have more in common with i.e. Calvin Klein than Spurs!!!!

 

[kf]

Originally posted by thumper:
<strong>As a shareholder I'm happy that we are a PLC as the club cannot splash money around left right and centre and end up like Leeds/Chelsea etc.</strong><hr></blockquote>
Leeds are a plc! It's not being a plc that stops a club getting into bother it's the sensible financial management. Say what you like about Edwards (git of the first order imo) but he did get that side of it right. Kenyon is continuing to keep us within the bounds of what is financially achievable.

 

[thumper]

True but I think Leeds tried to buy their success from a not so stable financial situation and I dont think they thought through what would happen if they failed. We on the other hand probably because we have so many other fields of business on the go through out TV channel/merchandising etc have a much better handle on what we can afford to pay out and what the business can sustain. I think our main difference with other PLC clubs is that its run as a business and success on the pitch, while helpful, doesn't really affect too much the clubs cofferr's, and I'm glad of that cos it will sustain us through the not so good times if they happen again.

 

[great_se7en]

Originally posted by Rams:
<strong>United are the only club where it makes sense to be a plc. We are the only club who rely mostly on it's merchandising (rather then tv money etc.) for it's income. In that respect we have more in common with i.e. Calvin Klein than Spurs!!!!</strong><hr></blockquote>

How much of this do you affects things like the players we buy? Ever wondered why we seem to purchase establibshed, popular players like Veron, despite the obvious numerous other possiblities? When marketing a global image is involved surely the Argentine Captain in midfield can only help improve things?

 

[Neil Thomson]

Originally posted by thumper:
<strong>True but I think Leeds tried to buy their success from a not so stable financial situation and I dont think they thought through what would happen if they failed. We on the other hand probably because we have so many other fields of business on the go through out TV channel/merchandising etc have a much better handle on what we can afford to pay out and what the business can sustain. I think our main difference with other PLC clubs is that its run as a business and success on the pitch, while helpful, doesn't really affect too much the clubs cofferr's, and I'm glad of that cos it will sustain us through the not so good times if they happen again.</strong><hr></blockquote>
Whether its a Plc. or a Ltd. or just FC, all can be managed well, or badly. Our revenues are boosted by merchandise etc. but if we didn't finish in the top 4 it would have a huge effect, on revenue, and share price, and dividend, so we're certainly not immune from the financial effects of poor performance.

 

[kf]

Originally posted by thumper:
<strong>I think our main difference with other PLC clubs is that its run as a business and success on the pitch, while helpful, doesn't really affect too much the clubs cofferr's, and I'm glad of that cos it will sustain us through the not so good times if they happen again.</strong><hr></blockquote>
I agree. The plc generates income through sources other than football and it realises that it can't exist without the football. Also, the plc is able to generate more income if the club is successful on the field ('cos of all the glory hunters that buy shirts etc.). So the plc has a vested interest in making keeping the football club successful and a financial interest in keeping us viable. That way it should maintain the right balance between money available for transfers etc. and making sure we don't go bust!