From Glazers to Qatari Royalty: What's Next for Manchester United?

Synopsis:
The Glazer family's controversial ownership of debt-ridden Manchester United is expected to end with Qatari royal Sheikh Jassim's £6 billion takeover. The deal promises to erase the club's £725 million debt, marking a potentially transformative moment for the team. Read the blog to learn more.

Football is not just a sport; it is a business, a big one!

Manchester United Football Club [MUF] (Nicknamed the Red Devils) is a professional football club based in Old Trafford, Greater Manchester, England. The club competes in the Premier League, the top division in the English football league system.

Manchester United, a globally supported club, was the top-earning football team in 2016–17 with €676.3 million in revenue and the world's third-most-valuable in 2019 at $3.81 billion.

Manchester United has the second-highest average attendance of European football clubs.

The club has the world's third-highest social media following among sports teams (after Barcelona and Real Madrid), with over 62.8 million followers on Instagram as of August 2023.

Manchester United vs. Liverpool is considered the most famous fixture in English football and one of the biggest rivalries in the football world.

Manchester United has won 12 English Premier League titles since that league’s inaugural season in 1992–93.

Total revenue of Manchester United from 2009 to 2022(in million U.S. dollars)

Manchester United's link with the stock market

As the second English football club to float on the London Stock Exchange in 1991, the club raised significant capital, with which it further developed its commercial strategy.

A key sponsorship relationship was with sportswear company Nike [NKE] who managed the club's merchandising operation as part of a £303 million 13-year partnership between 2002 and 2015.

On 30 July 2012, United signed a seven-year deal with American automotive corporation General Motors [GM]. The new $80m-a-year shirt deal is worth $559m over seven years and features the logo of General Motors brand Chevrolet.

Since the start of the 2015–16 season, Adidas [ADS] has manufactured Manchester United's kit as part of a world-record 10-year deal worth a minimum of £750 million. Plumbing products manufacturer Kohler became the club's first sleeve sponsor ahead of the 2018–19 season.

The financial services industry is the most heavily represented, totaling 14 agreements with Manchester United in 2022/23. Technology, travel & tourism, beverages, and consumer goods & services follow this.

Let's dig deep into history and the Glazer Era

Malcolm Glazer was a businessman and owner of a sports franchise in America who died in 2014.

In May 2005, Malcolm Glazer purchased the 28.7 per cent stake held by McManus and Magnier, thus acquiring a controlling interest through his investment vehicle in a highly leveraged takeover valuing the club at approximately £800 million (then approx. $1.5 billion).

The Glazers, current and controversial owners of Manchester United, are unpopular among many fans.

Inherited by Malcolm Glazer's six children, the family took full ownership of the club in 2005 after acquiring shares in 2003.

Some challenges under their ownership

Failure to invest in Man United infrastructure

Player recruitment failures under Glazer ownership

Commercial interests in football results

Why do they want to sell?

The Glazers are selling United because of debt. The club was debt-free when the Glazers took ownership in 2005. However, the purchase agreement recommended by former executive vice-chairman Ed Woodward is said to have added more than £500 million in debt to the company.

To the dismay of fans, Malcolm Glazer used a leveraged buyout scheme to finance a large portion of the takeover rather than using his funds.

Due to the Covid-19 epidemic, the club's debt had increased by 133% to £474 million by the end of 2020.

Manchester United Saga

The takeover of Manchester United has been ongoing since November 2022.

As the Manchester United takeover saga rumbles on, Qatar’s Sheikh Jassim bin Hamad Al Thani and British billionaire Sir Jim Ratcliffe are two frontrunners to take over at Old Trafford.

While Sheikh Jassim’s offers for a total buyout, the Ratcliffe proposal is for a staged takeover (69%), allowing members of the Glazer family to retain their interest for a set period.

Sheikh Jassim: New Era for Manchester United?

The vision of the bid is for Manchester United Football Club to be renowned for footballing excellence and regarded as the greatest football club in the world- Sheikh Jassim

Sheikh Jassim has reportedly won the race to become the new owner of Manchester United in what will be a £6bn deal – with a date set for when the Glazer family’s 18-year reign will end.

Sheikh Jassim will buy 100% of the club and will also wipe out the gross debt of £725 million that was racked up over the Glazers’ stewardship of United.

The Sheikh Jassim Bin Hamad Al Thani takeover of Manchester United from the Glazer family is expected to be completed by October. Sheikh Jassim is the chairman of the Islamic Bank of Qatar (BIQ) and a member of the Qatari royal family.

Will Man Utd thrive under Qatari Royalty?

Immense success, passionate fans, and periods of transformative change characterize the history of Manchester United. The potential takeover by Sheikh Jassim might mark the beginning of a new chapter for the club. Fans worldwide will be eagerly watching how this possible change in ownership impacts the club's fortunes, both on and off the pitch.

Is the sale of the club off Market?

News broke that the Glazer family will pull the club off the market, so the club's shares fell by more than 18% in New York on Tuesday, slashing almost $740 million off the soccer club’s market value, their share seeing biggest ever one-day fall.

When this Man Utd takeover saga began, it was reported that the Glazers wanted around £6bn to £7bn to sell the club. But now, this amount will not be enough for Manchester United as the Glazers want more.

Glazers saw the NFL team Dallas Cowboys getting sold for £7.7bn. And, for the Glazers, Man United are on the same or even more significant level than the NFL team. Sheikh Jassim and Sir Jim Ratcliffe are still waiting to buy the club. Glazers are hoping to attract up to £10billion.

Wrapping Up

Sheikh Jassim's potential takeover of Manchester United could mark a transformative era, promising financial stability and a renewed focus on footballing excellence. However, only time will tell if this change addresses deep-rooted issues and restores the club to its former glory. Fans worldwide are watching closely, hopeful yet cautious.

Read this blog to know more about the game.