Thursday 8 December 2016

Ten years on but Glazers' story is only just starting

Despite a decade in which they have faced mostly hostility, there is no sign of the Americans leaving

Mark Ogden

Published 11/05/2015 | 02:30

'When Cristiano Ronaldo was sold to Real Madrid for a world record £80m in June 2009 – the proceeds of the sale were not reinvested in the team'
'When Cristiano Ronaldo was sold to Real Madrid for a world record £80m in June 2009 – the proceeds of the sale were not reinvested in the team'

If the bankers and financial advisers had had their way, the Glazer takeover of Manchester United in May 2005 would never have happened. "There were so many bumps in the road and obstacles that had to be cleared," one key player in the takeover process recalls now. "There was no recommendation from the United board that shareholders should support the bid and you just don't do hostile, leveraged takeovers.

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"There was also no certainty that the Irish (John Magnier and JP McManus) would sell their stake, so it was a hugely challenging process and the people who should have been calm and measured - the bankers - were worried.

"But the calmest people in the whole process were the Glazers and they were the guys urging everyone else not to overreact and stay calm, even though Joel Glazer was suffering from appendicitis during the build-up to the takeover."

Appendicitis was the least of Joel Glazer's concerns, with the Florida-based owners of the Tampa Bay Buccaneers facing almighty resistance from supporters and shareholders alike as the family attempted to complete a £790million takeover of United. Effigies of Malcolm Glazer, the head of the family, were burned outside Old Trafford, a reserve-team fixture was halted by supporters in balaclavas, who presented themselves as the 'Manchester Education Committee', holding aloft an anti-Glazer banner, and the club's plc board was headed by the chief executive David Gill who, in August 2004, had warned that "debt is the road to ruin" when a takeover began to appear inevitable.

But despite the "bumps in the road" between October 2004, when the Glazers approached the 30 per cent stake barrier that would have triggered a compulsory takeover bid, to the day in early May 2005 when Magnier and McManus agreed to sell their 28.7 per cent holding, the Americans resisted the concerns and fears of their advisers and ploughed on with the takeover, despite a rising share price that forced them to rely on hedge funds to seal the deal.

Sixteen years after Michael Knighton failed to complete a £20m takeover of the club, and six years on from the Monopolies and Mergers Commission's decision to block BSkyB's £623m takeover bid following another fiercely-fought supporter-led campaign against prospective new owners, English football's biggest club was now in the hands of a reviled family from Florida and facing an uncertainty.

Many fans turned their back on the club, some choosing to form the breakaway team FC United of Manchester in protest, while others braced themselves for higher ticket prices and the sale of star players to help pay the debts imposed by the Glazers mortgaging the club to pay for the takeover.

Fears were also raised of Old Trafford being sold off to the highest bidder in a naming rights auction, but while Cristiano Ronaldo was sold to Real Madrid for a world record £80m in June 2009 - the proceeds of the sale were not reinvested in the team at a time when the Glazers' financial empire began to run into difficulties in the United States - the stadium remains unbranded.

Having plunged the club into debt to the tune of almost £700m with their leveraged takeover, hostility reached fever pitch when a vehicle carrying the Glazer brothers, Joel, Bryan and Avram, was attacked outside Old Trafford two months after the buy-out was completed.

It led to Joel appearing on the club's in-house television channel, MUTV, to allay their fears. "Judge us over the long haul, don't judge us on a day or the last several months," Glazer said in July 2005. "We would have not got involved with Manchester United if we did not feel that the club, under our ownership, could continue to be the great club it has been.

"A lot of businesses have debt. Debt can mean different things to different people, but I can assure everybody that the structure that was put in place is a structure we're extremely comfortable with. It is not a bottomless pit, but the way this club has been operating in the past is going to be the way it's going to operate in the future. This should not scare you. It is business as usual, business as it's always been. It is time to put all the distractions aside, compete on the pitch and win the trophies everyone wants."

Bobby Charlton also joined in the call for calm after speaking to the Glazers about his concern.

"I'm like any other football fan," Charlton said. "I've been waking up in the night wondering what was going on. But they (Glazers) allayed a lot of my fears. I asked them questions about the future of the club and the future of people who were wrapped up in the club. They were receptive to everything and said they would do everything they could to make this a successful football club."

Among the playing squad, there was silence. Equally, Alex Ferguson, whose power could have mortally wounded the Glazers at any stage, also chose to work with, rather than against, the owners.

Roy Keane, the captain at the time of the takeover, offered a phlegmatic view of the change of ownership in his recent autobiography, The Second Half. "From the players' point of view, it didn't bother us too much," Keane wrote. "I had a few shares in the club as part of my contract. So the Glazers coming in was worth a few bob to me."

On the field, United have won 15 trophies under the Glazers, but the present and the future appears to be a different landscape, one which many believe has been shaped by decisions made between the sale of Ronaldo and Ferguson's retirement in May 2013. It was a stormy four-year period, marked by underinvestment in the playing squad and refinancing.

Decision

During the 'value years', the Glazers' decision to float a £500m bond issue in 2010 sparked the birth of the green-and-gold campaign, with supporters brandishing scarves in the colours of Newton Heath, the club which became Manchester United, in protest against the owners.

When David Beckham, returning to Old Trafford in a Champions League fixture with AC Milan, placed a green-and-gold scarf around his neck in March 2010, it seemed as though a tipping point had been reached, with the Glazers now facing a decisive moment. But it proved to be the movement's zenith, with the campaign losing momentum.

The positive spin on the Glazers, 10 years on, is that they have become a model for American owners having avoided the controversies and failures of the Tom Hicks and George Gillett regime at Liverpool and laid the blueprint for commercial growth which all rivals now aim to emulate.

The debt has been reduced by half, with interest payments now a drop in the ocean for a club of United's financial might. But many would argue that allowing more than £700m of club money to be drained away on interest repayments and refinancing costs has left United in the position they now occupy, with huge sums being invested in the squad to make up for the lack of spending between 2009 and 2013.

It seems that, for all their mistakes and successes, the 10-year anniversary of the takeover is only the start of the Glazer story. There is no sign of the club being sold anytime soon, with a £1.5billion offer from the Middle East being rejected in 2009. But with Ferguson gone and United's era of dominance over, the next 10 years promise to be as challenging as the first 10. (© Daily Telegraph, London)

Telegraph.co.uk

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