News Analysis

Wednesday 27 August 2014

Liam Collins: A high-stakes battle of Ferguson, Magnier and JP McManus

The fallout from the row over the 'Rock' reached as far as the United boardroom

Liam Collins

Published 12/05/2013 | 05:00

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Alex Ferguson with Horseracing Tycoon John Magnier and Susan Magnier.

WHEN Mull of Kintyre won the prestigious six-furlong Gimcrack Stakes at York on the August 18, 1999, none of the famous people connected to the horse could have foreseen that it would ultimately destroy the friendship of Sir Alex Ferguson and Ireland's most powerful racing figure, John Magnier of Coolmore Stud.

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The pair were casual friends and although Magnier had never been to Old Trafford, his longtime friend and associate, the gambler JP McManus, was a fanatical United fan, frequently flying by private jet to watch his favourite soccer team.

Ferguson, who grew up in the shadow of Glasgow's shipyards and remembered his father having a 'tanner Yankee' (a six-pence accumulator bet) on the horses every Saturday, had developed a casual interest in racing. "One of the reasons I like racing is that, largely, people leave me alone. And when they do talk to me it is likely to be about what is going to win the 3.30 rather than football," he said.

A tradition had grown up that the owner of the horse which won the Gimcrack Stakes would deliver an address to the prestigious Gimcrack dinner which is held in the city just before Christmas. Magnier was not much given to public speaking and nominated his friend Alex Ferguson to speak on his behalf.

For some unexplained reason, this offer was rejected by the racing gentry of York who were the organisers of the race meeting and the subsequent dinner. So, instead, guests were treated to Bob Lanigan, representing Coolmore, who sang a ballad commemorating the exploits of Mull of Kintyre and other Ballydoyle horses, which neighbouring Tipperary landowner Sir Andrew Lloyd Webber had helped to compose.

Co-incidentally, Magnier and his partner JP McManus had just splashed out £50m through a special investment vehicle, Cubic Expression, to buy a large stake in Manchester United from Martin Edwards, whose family had been the long-term owners of the club.

"That they [Magnier and McManus] are both friends of Sir Alex Ferguson, the United manager, sharpens the tabloids' teeth," wrote journalist Alan Ruddock at the time. "Ferguson has been at war with his board and particularly his chairman, Martin Edwards, over the past few years."

While he was eyeing up the prospects of Manchester United in the year 2001, John Magnier had not forgotten the snub to his friend Alex Ferguson and his own resolve that one day the Manchester United manager would give the Gimcrack speech in his own right.

Socially Alex Ferguson was now close to the 'Coolmore Crowd', flying over to Shannon to tour around Ballydoyle or being picked up by private jet to attend a charity dinner hosted by JP McManus at Adare Manor. There he played golf and mingled comfortably with the 'set' – John Magnier, Dermot Desmond, JP and their friends who included the legendary Tiger Woods.

In the summer of 2001, after three Coolmore horses trained by Aidan O'Brien raced in Alex Ferguson's distinctive red and white silks, Magnier and O'Brien noticed something special about a promising two year old called Rock of Gibraltar.

The end result was that Alex Ferguson was registered with Horse Racing Ireland as a 50 per cent owner of the horse with Susan Magnier, wife of John, on the August 17, 2001 – the same day as the horse was 'declared' to run in the Gimcrack on August 22. From then on, the horse ran in the colours of the 'Red Devils'.

"My first real memory of Rock of Gibraltar was at the Gimcrack Stakes at York in August. I had bought him a couple of months earlier and he had already won once," Ferguson said in 2002. But he hadn't actually paid any money for his share in the horse or contributed to its expensive upkeep. So what did 'bought' mean?

As far as Magnier was concerned, it was a formality to give Ferguson a thrill that many wealthy and powerful people crave: having a top-class horse winning prestigious races in their name and picking up a share of the lucrative prize money involved.

According to Martin Hannan, in his book Rock of Gibraltar, things were further complicated because in the Stud Book, the bible of horse breeding in England and Ireland, ownership was listed as 'Rock of Gibraltar syndicate' and not Alex Ferguson and Susan Magnier.

The Manchester United boss wasn't at York to see the Rock win the Gimcrack, but it was an event that set him up to make the speech at the "frightfully grand" Gimcrack dinner which he had been denied a few years previously.

"My deepest gratitude," he told the audience, "is due to two friends who are not here, Sue and John Magnier. I have been given the privilege of teaming up with them, and standing up before you this evening. Nobody could be blessed with better friends than them."

Rock of Gibraltar went on to win seven Group 1 races in succession in Ireland, England and France, becoming the 'wonder horse' of his generation.

"You always have to be surprised when something like this happens," Magnier told RTE in a rare interview. "He is a tough, durable, versatile horse. No doubt about that. And Alex [Ferguson] is lucky."

After being unluckily beaten into second place in the Breeder's Cup Mile in Arlington Park in the US on October 26, 2002, the Rock was promptly retired to stud at Coolmore, Magnier's sprawling stud farm in Tipperary.

An article in the Daily Telegraph in November 2002 speculated that the horse's stud value could be as high as £50m Sterling and Ferguson's half-share would dwarf the money he was getting from running the most valuable football club in the world.

But when Alex Ferguson and John Magnier finally sat down to thrash out the future of Rock of Gibraltar, it was clear that there was more than just a cultural difference in their approach to the exact status of what 'owner' meant.

Magnier was clear – the ownership was a nominal honour that would entitle Alex Ferguson to 50 per cent of Rock of Gibraltar's earnings on the racetrack of £1,164,804 or one stud nomination a year in Ireland and one in Australia, where the horse would 'stand' in the winter. The probable value of these was over €150,000 a year for an expected 10 years. Ferguson initially insisted on his 50 per cent, but as negotiations proceeded, he held out for 15-20 per cent of the stud value of Rock of Gibraltar.

By the summer of 2003, the two men's friendship was seriously dented.

What made Magnier equally uncomfortable was the glare of a media spotlight that had settled on him and a worldwide horseracing operation. Rock of Gibraltar was already earning £10m a year in stud fees when Magnier finally offered Ferguson four stud nominations per year, which Ferguson rejected.

As the row between the two men escalated, it became a battle for the future of Manchester United and for Alex Ferguson.

When the row first arose, Magnier and his long-time associate JP McManus held 6.7 per cent of Manchester United. On October 7, 2003, it was disclosed that their company, Cubic Expression, had spent a further £62m acquiring another 10 per cent stake in Manchester United that had been held by BskyB.

Events were beginning to move almost as fast as the first-class thoroughbred about whom they were fighting.

Ferguson turned for backing to a group of advisers who included the well-known Dublin barrister Colm Allen and Tony Blair's former adviser, Alastair Campbell. Their cloak-and-dagger campaign, code-named 'Project Rathgar', was aimed at mounting a legal challenge to enforce Ferguson's half-share of the Rock.

In late 2003, Sir Alex began formal legal proceedings in the High Court in Dublin against Coolmore Ltd with a Statement of Claim which alleged that Alex Ferguson's name had contributed to the massive stud fees earned by the horse; that he was a half-owner of Rock of Gibraltar and that he was entitled to half its earnings which were estimated at €50m-€70m over the following 10 years.

As the row over the Rock continued, another figure had entered the United boardroom battle in the shape of American sporting tycoon Malcolm Glazer who had begun to build up a stake in the club.

The Irish shareholders, Magnier and McManus, put a series of questions through Cubic Expression to the Manchester United board and its solicitors relating to payments to players, the financial organisation of transfer deals and payments to Ferguson himself. This delayed negotiations between Manchester United and Ferguson on a new contract and Ferguson, the most favoured football manager in the world, was now put on a rolling yearly contract.

By February 2004, Cubic Expression owned 28.39 per cent of Manchester United and there were strong indications that Magnier and McManus might take over the club. But the intervention of a group of Manchester United fans called 'United4Action' brought the Magnier/Ferguson issue to a head, with claims that it was planning to hold protests on the issue at the annual Cheltenham race meeting in England.

It was a prospect that led Ferguson to deliver the following statement on the steps outside Old Trafford:

"The reputation of Manchester United is paramount to my thinking. The private dispute I have is just that and I don't want to exacerbate the whole thing. Cheltenham is such a great festival and I don't want it marred in any way. I am strongly opposed to any violent, unlawful or disruptive behaviour which may reflect badly on the club and its supporters in general."

Magnier took Ferguson's conciliatory words as a sign of goodwill and a settlement was agreed between the sides in which Alex Ferguson would be paid a lump sum of £2.5m, he would renounce all claims to Rock of Gibraltar, discontinuing the contentious legal action instituted in the Dublin courts.

But 'The Irishmen' had one more deal to pull off before the saga was complete – they sold their holding in Manchester United to Malcolm Glazer, the 76-year-old Florida-based owner of the Tampa Bay Buccaneers for an estimated £230m, netting Magnier and McManus an estimated profit of £80m on their Manchester United adventure. (Manchester United is now valued on the New York Stock Exchange at £1.5bn.)

Ironically John Magnier was at York, the scene of his triumphs with Mull of Kintyre and Rock of Gibraltar, when the sale was completed.

"I really don't have anything to add," said Magnier when asked about the deal by reporters. "Let's talk about horses now."

Irish Independent

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