The ownership structure of Manchester United has become even more opaque after the Glazer family shifted the ultimate ownership of the club to a new company incorporated in the US state of Delaware.
Delaware is rated the most secretive financial location in the world, and the change means that it will be even harder for supporters and media to establish the implications of the club’s corporate structure.
The most pressing issue concerning Manchester United’s highly-mobilised fanbase is how the Glazers managed to clear £249.1m of payment-in-kind (PIK) loans that had been incurring interest at more than 16pc before it was abruptly paid off in November last year.
Delaware’s secrecy rules mean that the directors, officers and shareholders of the new company are unknown, as is the source of the money used to repay the PIKs.
The PIKs were controversial because they were secured against the Glazer family’s shares in United’s holding company, meaning that ultimately the club could have been passed to the hedge-fund lenders in the event of default.
The Glazers have declined to say how they paid off the PIK loans, and whether any debt incurred to do so is still secured against the family’s shareholding in the club or related entities.
Financial analyst Andrew Green, who blogs on football finances as Andersred, said the move suggested the Glazers were trying to obscure the source.
“It is almost as if the Glazers are trying to keep information about the PIK repayment secret,” he wrote. “Naturally we can’t ask the Glazers anything about this as they won’t talk to the fans and their employees in M16 don’t appear to know. In my view that is not how the biggest football club in the world should be managed.”
US-based sources have suggested that the Glazers have taken a new loan at a cheaper rate to clear the PIKs rather than turning to third-party investors or using personal cash. It is unclear what security they have offered against the loans, and with United apparently their most valuable asset there remain concerns that the club revenues could still be required to service the loans.
According to UK regulatory filings lodged with Companies House the new Delaware company, Red Football LLC, now owns 100pc of the shares in the club’s UK parent company Red Football Shareholder Limited (RFSL).
RFSL was the vehicle by which the PIKs were paid off, but is now hidden behind the new structure in Delaware.
Last November two new shares in RFSL were issued at a combined value of £249m. RFSL then bought two shares in its subsidiary Red Football Joint Venture, which owned the PIKs, and the money was used to pay off the loans.
Manchester United and the Glazer family declined to comment on the changes, but a spokesman said the Glazers remain the ultimate owners of the club.