Manchester United Football Club is an English football team headquartered in Old Trafford, Greater Manchester.
Newton Heath LYR Football Club was founded in 1878 as the workers team of the Lancashire and Yorkshire Railway depot in Newton Heath.
The club separated from the railway business in 1892 and remained privately owned for over a century, changing its name to Manchester United after being spared from bankruptcy in 1902.
Before going public in 1991, the club received takeover bids from media tycoon Robert Maxwell in 1984 and property trader Michael Knighton in 1989; another takeover bid came from Rupert Murdoch’s BSkyB corporation in 1998, before Malcolm Glazer’s stake was announced in September 2003.
Glazer’s stock had risen from 3.17% to roughly 15% by the end of 2003, and he had nearly doubled it in the year ending October 2004.
Who owns Manchester United in Details?
Manchester United is presently owned by the six children of the late previous owner Malcolm Glazer: Avram, Joel, Kevin, Bryan, Darcie, and Edward Glazer.
In 2005, Malcolm Glazer acquired a majority share of the team through his investment business, Red Football Limited.
When he died in May 2014 from a long illness caused by a stroke, the six Glazer children received an equal share of his 90% controlling stake.
Since their father’s stroke in April 2006, Joel and Avram have been in charge of running the club daily.
The pair are now co-chairmen, with Kevin, Bryan, Darcie, and Edward serving as directors.
In March 2021, Avram Glazer listed his shares for sale for £70 million ($97 million).
When and how did the Glazers take over Manchester United?
Malcolm Glazer began accumulating shares in Manchester United in 2003, following the suggestion of his sons and had fully owned the club by the end of 2005.
In March 2003, he spent over £9 million ($4.7 million) on his first 2.9%, which had risen to nearly 30% by the end of the following year.
In 2004, businessmen John Magnier and J. P. McManus clashed with Manchester United manager Sir Alex Ferguson.
The two controlled 28.7% of the club and partnered with Ferguson to invest in the Irish thoroughbred ‘Rock of Gibraltar’.
After a conflict regarding student rights, the businessmen decided to leave the club, and Glazer purchased their interests in May 2005.
This increased his holdings to almost 57%, much above the 30% level required for a takeover bid.
When Glazer gained control of 75% of the club’s shares in a matter of days, he was able to delist the business from the stock exchange, and Red Football Ltd acquired 98% ownership within a month, forcing a squeeze-out of the remaining 2%.
Ed Woodward, who later became the club’s executive vice-chairman, was intimately involved in the transaction as an advisor and was immediately hired by the Glazers in a ‘financial planning’ capacity.
Has anyone else attempted a takeover of Manchester United?
Before the Glazers’ 2005 acquisition, media magnate Rupert Murdoch attempted to buy the club in 1999, with his £623 million ($1 billion) offer accepted by the United board.
However, the government’s Monopolies and Mergers Commission eventually denied the merger, citing a potential conflict of interest given Murdoch’s sports media operations.
When Magnier and McManus attempted to sell the 28.7% stake subsequently acquired by the Glazers, one reportedly interested party was former Libyan dictator Colonel Muammar al-Gaddafi.
Mehmet Dalman, who was engaged in the Glazers’ ultimate takeover, claimed he was invited to Libya in 2004.
The Manchester United Supporters’ Trust (MUST) has been working to return control of the club to supporters since 2005, and they came close in 2010.
The Glazers’ involvement in the abandoned Super League plans for 2021 prompted increased calls from MUST for a change of ownership, with a 50+1 model proposed as an alternative.
A group of affluent United fans known as the ‘Red Knights’ explored a takeover attempt with them, but the plan ultimately failed because the group refused to accept the Glazers’ price. Lord Jim O’Neill and Sir Paul Marshall were part of the group, and they returned to the podium in 2021 to endorse the 50+1 concept.
In 2019, Saudi Arabia’s Crown Prince Mohammed Bin Salman was linked to several takeover bids for the club, with reports indicating a willingness to pay £3 billion ($4 billion).
In response to rumors, Woodward told club fanzine United We Stand that the Glazers are “in it for the long haul” and have no plans to sell the team.
Conclusion
United were debt-free when the Glazers took possession in 2005, but the takeover transaction recommended by Woodward reportedly burdened the club with more than £500 million ($920 million) in debt.
To the dismay of their supporters, Malcolm Glazer used loans to finance a large portion of the takeover rather than using their funds and a “leveraged buyout plan.”
This entails borrowing money against a future asset to purchase that asset, resulting in annual interest payments of more than £60 million ($110 million).
In the years since it has been widely claimed that the takeover cost the club more than £1 billion ($1.3 billion) in interest and other costs.
By late 2020, the club’s debt had soared by 133% to £474 million ($618 million), with revenues severely hampered by the Covid-19 pandemic.
The company’s tax registration was transferred from Old Trafford to the Cayman Islands in 2012, and the club has paid a yearly dividend, most of which goes to the Glazers, since 2015.
Dividends reported in the club’s 2018-19 reports totaled £23 million ($30 million). Around £18 million ($24 million) was reportedly shared among the six Glazer brothers.
TEAM income has more than doubled since 2005, thanks in part to the massive and diverse commercial partnerships acquired during the Glazer period, and Forbes 2020 ranked United as the world’s third-most valuable football team.
They also finished fourth in the Deloitte Football Money League in 2021, behind only Barcelona, Real Madrid, and Bayern Munich.