The Manchester United Club Thread **Sponsored by Comedy Central**
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Caporegime
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They have self awareness and they are intelligent. They know exactly what they are doing just like all those hedge funds that come and take over all the high street, asset strip, pocket the money then run it into the ground.
The Glazer's are essentially interest only buy to let hustlers who will let the occupants live in mould and damp then just flog it off when they are done with it simply because it is a appreciating asset.
They know what they did back in the early 00's is impossible to do now so for them to get rid of their gravy train they need to sell it for overs to make up for potential future earnings.
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There's lots of criticisms you can make of the Glazers but asset stripping? I'm not sure you know what the term means if you think the Glazers are asset strippers. Your last point is wrong too. They can still do what they done back then and the reason for not selling is because they believe PL revenues are going to continue to increase, further increasing the valuation of the club.
Like them or not, they were the first in a long line of Americans that realised that the PL was massively undervalued. They looked at the revenue NFL sides were making from commercial deals and tv rights and compared the viewing figures of the NFL to PL. They knew PL revenues were going to sky rocket and if they just sat on the club, taking a trickle of cash out in dividends or selling off a few shares here and there, the value of the club was going to go through the roof. And they were right. Over the years more and more Americans have cottoned on and over the past couple of years we've seen Americans falling over themselves trying to buy PL and other European clubs at what many think are crazy valuations. They're not buying into football for their love of the sport, they're just convinced (like the Glazers) that there's going to be another tv rights boom and valuations will keep going up. That's why the Glazers won't fully sell up, not without somebody paying ott now.
Caporegime
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I wouldn't call the Glazers intelligent. It doesn't take intelligence to be the child of someone rich.
I admire your optimism. But you’re right, we’ll just have to wait and see.
Of course they don't. Someone will buy a company for many different reasons but no one buys a football club to asset strip and pocket loads of money. If United were well run they would be worth probably twice what they are now, perhaps 3 times. We could have had a period of absolute dominance over the past 15 years with a well run United. We have matched Citys spending and started a few rungs above them in every area of the game, on and off the pitch. A well run United would be a much better version of City essentially.
Its quite astonishing that we have matched their spending and are an absolute country mile behind them at this point. Its astonishing.
If United were a well run club the Glazers would be laughing all the way to the bank and probably wouldn't be considering a sale of the club. If they were considering a sale of the club they would have been looking at 6bn being lowball offers rather than pie in the sky.
This isn't true though and is a fairly key point as to why the Glazers aren't that fussed about performance beyond CL qualification.
The value of the club is dictated by the revenue and the security of that revenue. If Utd were better run and finishing 1st to 3rd regularly instead of 3rd to 6th, they're not going to be making 2 or 3 times the revenue. They'd be lucky if they earned 20% more. The majority of Utd's revenue is fairly secure - they're getting circa £150m from the PL (and it's not a huge amount more/less if you finish 1/2 places higher or lower), matchday revenue isn't changing much, likewise there's not a huge scope for greater commercial revenue. The only difference is CL or EL qualification and once you factor in the wage reductions of missing out on the CL, its not worth a huge amount.
Better performance would increase the value but not significantly and certainly not anything like what you think.
I disagree. Revenue would be considerably higher if we were in the CL every season, were winning the CL and league regularly and still held the same appeal as we used to relative to other clubs. Factor in the reduced costs in recruitment and salary that would would be paying and the club would be a huge amount better off. Assume that the facilities hadn't been left to rot and the club wasn't still in the best part of £1bn debt and we would be hugely better off.
All of these things could easily add up to £100-150m per season vs our current state. As to commercial revenue. If we were more successful then sponsorship deals would be larger, again adding a not inconsiderable chunk to our finances every year.
The Glazers aren't that bothered outside of CL qualification because they think that is enough to keep things ticking over. Which is correct. Its enough to keep things going but if we were a brilliantly run club with our resources we would be worth massively more than we are.
With all of the above considered I don't think that the club being worth double what its valuation is now is anything like an overestimation.
I said 20% which would be circa £120m, so you're agreeing with my assessment. And you're basing this on Utd winning the CL regularly (because that's realistic given that you managed it twice in 20 odd years of being 'well run') as opposed to 1 season in, 1 season out - in real terms that equates to an average of circa £50m extra per season, not £150m.
Re commercial revenues, they'd be more but not huge amounts more. Bayern, who always have had greater commercial revenue than Utd due to the size and their dominance of the German market, take in around £40m more per season. There just isn't huge scope for increase their.
Anyway, even if we go with your top end of £150m, that's around a 25% increase in revenue (that will also result in increased costs but we'll forget them to help you). So 25% increase in revenue will result in a 100-200% increase in valuation? Of course it won't.
This is ultimately why the Glazers spent the bare minimum until the club started to miss out on the CL. There just isn't the extra revenue from finishing 1st instead of 3rd or 4th to justify the extra costs of trying to finish 1st.
I'm basing it on winning the CL and/or league regularly instead of completely missing out on CL and coming outside top 4 regularly. Winning the CL is worth ~£70m. Winning the PL vs coming outside of CL places is worth about £10m. Even just doing well in the CL and coming in the top few of the PL is worth ~£30-40m vs not.
And yes, considering how many times City have won the PL and done well in the CL over the past decade, a well run United would very much have expected to do the same or better.
Why not? We have the largest fan base in the world. Brands want to associate themselves with successful enterprises.
We also currently have ~£1bn in debt and need to inject another ~1bn into the club to modernise the facilities.
So yes, I do think that all these things combined would have our valuation at probably double what it currently is. I'm not talking Glazers valuation, I am talking the valuation that is made by third parties with no vested interest in selling/buying the club.
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Caporegime
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I never said they were asset strippers. They are just cut from the same cloth as those people. Horrid people. No moral compass what so ever.
Your figures are wrong. Winning the CL is actually worth a lot more than that but how are you defining regularly? You're expecting Utd to win the CL every season, every other season, one in 4 or 5? If you look at Liverpool or City's record over the last 5 years, 1 win + 1 final + a few various knockout rounds, that's realistically what I'd class as doing well so lets use some real world figures to work out how much less Utd have earned from European money than Liverpool. Over the last 5 years Liverpool have earned 481m euros from CL money, Utd have earned 312m euros from CL & EL money. That equates to an average of 34m euros per season or roughly £30m. Lets go ott and say Utd would have done even better than Liverpool (they didn't in their glory days but anyway) maybe they'd earn £35 or even £40m more in European prize money per season.
As for the commercial revenue. First off Utd already have top tier deals for both their 2 major commercial deals just as you did when you were successful and just have you have continued to do when not successful. These deals don't seem to vary much based on success, highlighted by Liverpool signing their original standard chartered & warrior/new balance deals at a time when the club were a shambles (these were, at the time, on a par with the biggest deals around). I used Bayern as the benchmark as they are the gold standard for commercial revenue - as I said, even in Utd's best years, they still lagged behind Bayern on the commercial front and that is because outside the major kit deals Bayern benefit from being a monster in the German market. Not only would Utd never have the same level of dominance in the UK (because we have a number of other big clubs) but the German economy is also bigger. Like I said, it would increase if Utd were more successful but it's not going to increase huge levels. Utd already do very well here, there just isn't room for massive growth.
The point about debt and money required to improve facilities is a separate issue to the point you raised. The debt is factored into the valuation (eg a £4bn valuation would be £3bn for the shares + £1bn of debt) so doesn't change the point you made.
Like I said, Utd's valuation would be greater if the side were doing better and the club turning over more money but the headroom for growth is relatively limited and not enough to justify such a massive increase in valuation. Heck even at the current valuation Ratcliffe is investing at, most people say is ott and already factors in potential growth.
Soldato
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Theres clauses in a lot of United deals that cut their sponsorship deals by a significant amount if they fail to qualify for the CL - although wages are significantly increased if they do qualify as well as bonuses.
Not according to stuff I’ve read/heard from price of football or the athletic. The deals - specifically from Qatar was a full cash offer for the Glazers shares alone and they’d then clear the debt. It’s mind blowing. £5bn cash + 1bn debt + 1.5bn for fixture and fittings upgrades as well as likely spending what, 500m on players over 2 summer windows?
Incredible amount of money to turn down. I’m sure I read they wanted 8 or 10bn for it.
Not according to stuff I’ve read/heard from price of football or the athletic. The deals - specifically from Qatar was a full cash offer for the Glazers shares alone and they’d then clear the debt. It’s mind blowing. £5bn cash + 1bn debt + 1.5bn for fixture and fittings upgrades as well as likely spending what, 500m on players over 2 summer windows?
Incredible amount of money to turn down. I’m sure I read they wanted 8 or 10bn for it.
I'm not sure exactly what you're trying to say and I've no idea how it relates to my post. I gave an example figure of how a valuation will factor in the debt of a club/business. If as you say, not that Kieran Maguire will have access to the Qatari's offer, the Qatar bid was £5bn + taking on the debt then the valuation of the club would be circa £6bn. My point was simply that Utd's debt doesn't change the valuation, just how much the Glazers receive.
Soldato
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Fair enough.
Caporegime
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Another great week.
Evans injured during the week and now Hojlund, Eriksen and AWB. All out today.
Thank god for international break.
Evans injured during the week and now Hojlund, Eriksen and AWB. All out today.
Thank god for international break.
Today was a perfect game to play Mainoo and or Mehbri. The manager is running out of form players in to the ground as he fights for his job. I'd prefer he was a bit braver and at least give these fringe players some game time. Can they be any worse than Mount? Seems mad that he's signed Amrabat, Mount and Antony yet none of them are good enough to start ahead of McTominay or Rashford. Anyway, as you say the break hopefully comes at a good time although I fully expect Hojlund and Eriksen to play for Denmark and come back crocked.
Caporegime
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I disagree I think you need to get some consistency in who is playing. At least in his backbone.
I do think it is a bit of second season syndrome after the amount of games we played last season. You see it with many clubs but City seem to be immune to it. Lol