Man United Debt Hits £716million
- Thread starter AGD
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Raising ~£700m is a totally different propostion to raising ~£500m Frank. The risks to the investors would be far bigger and therefore even if the bond was fully subscribed, it would demand a far greater interest rate.
To give a rough example; it's been reported that some investors believed that the current issue should have had an interest rate of closer to 11%. Raising £700m at that rate would cost Utd an extra ~£30m per year in interest compared with the current issue (even if they got the same rate (which they wouldn't) it would be an extra ~£17m).
That's why the Glazers haven't tried to raise ~£700m.
To give a rough example; it's been reported that some investors believed that the current issue should have had an interest rate of closer to 11%. Raising £700m at that rate would cost Utd an extra ~£30m per year in interest compared with the current issue (even if they got the same rate (which they wouldn't) it would be an extra ~£17m).
That's why the Glazers haven't tried to raise ~£700m.
Soldato
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United are so screwed, this debt will never be paid off and I don't doubt it will eventually ruin the club.
How on earth someone can purchase a buisiness using the business to pay for it itself a joke.
How on earth someone can purchase a buisiness using the business to pay for it itself a joke.
Think about it this way. I take a personal loan and buy the club. I then with the club take another loan and pay myself a big enough dividend to payoff that personal loan. There's nothing wrong with paying myself that dividend because I own the business.
Of course you have to find a willing lender and hence the high interest rate. Also I might not have the collateral to take out that personal loan in the first place. However, a lender knows that in the above scenario as long as Man Utd can take out that loan, there will be no problems paying that personal loan off. Man Utd are effectively the collateral to that original loan.
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Thats fair enough thank you for that (and yes I had forgotten about reading about the investors wanting nearer to 11%) , It just seemed that the PIK interest was far worse, and the money is going to end up there anyway
The debt "hole" is just getting bigger and bigger it seems with little to no way out
Mind you - Liverpool got some bad news over the weekend , (or maybe just confirmation) about the Texas Rangers being sold by Hicks, but no money being ploughed back into Anfield, at least it doesnt affect you negatively I suppose
Its effectively asset stripping a business for your own personal gain which you personaly didnt have enough money to buy in the first place
There is EVERYTHING wrong with it
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The point is that it isn't illegal because I own the business and only the business suffers.
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Soldato
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I feel a bit sorry for ManU. It is gutting that someone can buy a perfectly healthy club and destroy it like this. But suppose it is the risk you take with a PLC.
must be nice having a sugar daddy
cant see MUST being able to raise anywhere near £1bn let alone the £1.4- 1.6bn that the club is supposed to be worth
At this moment in time the Glazers owe around £200m personally - and I think they put in around £300m or so to start with, so I can see the Glazers wanting £700m + before even starting to discuss a buyout - and with the recent £500m bond , MUST would therefore surely have to raise £1.2bn before even thinking about any talks
Nice dream, just cant see it happening
At this moment in time the Glazers owe around £200m personally - and I think they put in around £300m or so to start with, so I can see the Glazers wanting £700m + before even starting to discuss a buyout - and with the recent £500m bond , MUST would therefore surely have to raise £1.2bn before even thinking about any talks
Nice dream, just cant see it happening