Old Trafford – GAME OF THE PEOPLE

MANCHESTER UNITED, once one of the prized assets in world football, is for sale, a move that will gladden the hearts of the club’s many followers, who have been calling for the Glazer family to leave Old Trafford. While some will be rejoicing, others may temper their glee as nobody really knows who has the resources to take United off the hands of hard-nosed business people from the US. United will not be sold cheap, they will not be unloaded at a bargain price.

According to some reports, the Glazers will be looking to receive a figure north of £ 7 billion, although estimates from around the industry suggest the price may be anywhere between £ 4 billion and £ 6 billion. In a crisis-torn world, this limits the possible buyers and may even land United fans with another owner they struggle to love.

Regardless of any figure plucking exercises, it has to be remembered that this is one of the world’s top clubs, one of the most cash generative in the history of the game. Although United have fallen from their 1990s/2000s highs on the field, they remain an institution that will, sooner or later, return to profit on the pitch. They have most of the ingredients in place to reclaim their position as the most valuable club and with 75,000 spectators at every game, they have vast support to call upon. Old Trafford is an iconic stadium, but it is in dire need of modernisation to make it a statement home for Britain’s biggest club once more.

The Glazers may have recognised football may have reached something of a tipping point. It could be the days of milk and honey are not quite coming to an end, but maybe stagnating. A combination of peaked broadcasting fees, the pandemic and its post-crisis economic reality, along with growing pressure around energy, food, the climate and geo-politics, has created a perfect storm that creates a degree of uncertainty about the future. Football may have a period of adjustment that means greater challenges around its economic model. In other words, the price of football clubs may be at its peak, therefore the time to offload an asset might just be now. Chelsea changed hands for £ 4.25 billion, Liverpool are on the market and now United are seeking fresh investment (translated – we want to sell). Three of the Premier League’s big six may have new owners pretty soon.

The attraction of United should not be underestimated, but we are in an age when some sports teams may be “too big to buy”. Chelsea attracted a couple of hundred interested parties, but how many were realistic? It may be a case of lowering expectations on the part of the seller, or be prepared for a waiting game. US investors have shown they have an appetite in Premier League football and no less than nine of the 20 clubs have some form of US investment/ownership. United fans may be hoping that Jim Ratcliffe, the owner of INEOS, rekindles his interest in acquiring a football club or perhaps a vehicle like the failed Red Knights group that included former Goldman Sachs economist Jim O’Neil, comes forward.

The size of the deal makes another middle eastern transaction look more likely, which might not please some of the United hordes. Indeed, Dubai has already been mentioned in early dispatches, but they have one of a number of sovereign wealth funds with the resources to meet the Glazer’s demands. However, as we have seen in the past two years, with the Qatar World Cup and the Saudi Arabian takeover of Newcastle United, middle eastern connections are often accompanied by public disapproval.

Manchester United key financial figures 2012-22

£m	Revenues	P&L (pre-tax)	Wages	Net Debt
2021-22	583	(150)	384	515
2020-21	494	(24)	322	419
2019-20	509	(21)	284	474
2018-19	627	27	332	204
2017-18	590	26	296	254
2016-17	581	57	264	213
2015-16	515	49	232	261
2014-15	395	(4)	203	255
2013-14	433	41	215	275
2012-13	363	(9)	181	295

The Glazers didn’t get off to a good start when they arrived, loading debt onto the club after a leveraged buyout-type deal. The club has, apparently, consumed £ 1 billion of cash in servicing that debt while the owners have benefitted from regular dividends. So unhappy was a section of the support that a new club sprung-up in 2005 out of the discontent, FC United of Manchester, a fan-owned club that, at its peak, were attracting 3,500 people per game.

Manchester United have spent heavily in the transfer market, some € 2 billion since 2004-05, but they have made some very poor purchases in that time and their recruitment policy, generally, has left a lot to be desired. Furthermore, their wage bill has been astronomical, £ 384 million in 2021-22, more than double the amount paid in 2012-13.

They also repeated huge mistakes around the succession of Sir Alex Ferguson, and since he retired in 2013, United have won just three trophies. They have been missing from the Champions League four times and their last Premier League title win was in 2013. Neighbours City have won 12 prizes in that timeframe and Chelsea six. The most successful manager since Ferguson has been José Mourinho, who won the UEFA Europa League and EFL Cup in 2017 and had a win rate of 58.33%.

The recent debacle around Cristiano Ronaldo really sums up where United are at the moment, a club of their size and stature should not have been courting veterans in the first place but wasting so much money in the process was both foolhardy and directionless. It is no coincidence they announced it was exploring strategic alternatives to enhance the club’s growth immediately after reaching an agreement to allow Ronaldo to leave with immediate effect. United have to ensure they don’t allow the current malaise to continue because it is all too easy for big names to wander into the wilderness. This is absolutely the wrong time to be cast adrift.

MANCHESTER United are in danger of sinking into a prolonged era of mediocrity in much the same way that AC Milan and Inter Milan did before they rediscovered their mojo in recent years. Some might say they are already at that level.

That has to be the conclusion after the latest setback to United’s recovery under Erik ten Hag. The sight of their fans leaving the Etihad at half-time as they went in four goals down to their fierce local rivals indicated that their own people have had enough.

Admittedly, United were up against a Manchester City team that was on fire and their latest acquisition, the extraordinary Erling Haaland, looked like he was going to score every time he approached the penalty area. It did look as though United had got over their early season jitters with four consecutive wins, but against City they were exposed once more.

It has not been a good couple of weeks for the club, with a huge financial loss in 2021-22 and now this humbling at the hands of Pep Guardiola’s side. It’s hard to blame Ten Hag, because he has inherited a team that has been constructed over a period of time and has the influence of half a dozen managers. The problem at United has been brewing over nine years and owes as much to poor transfer market activity as much as anything else. The 11 players that started the Manchester derby cost the club around £ 350 million compared to the £ 460 million City spent on their line-up. Although £ 100 million is a big difference, one look at City’s team and it looks like fair value, as opposed to United’s, which resembles an exercise in overspending.

The problem is also not a question of poor team managers, either. They’ve tried highly respected people like David Moyes, track record coaches in José Mourinho and Louis van Gaal, “one of our own” in Ole Gunar Solskjaer and a left field approach in the form of Ralf Rangnick, who was a wrong fit right from the word go. Now they’ve gone down the list of the most successful coaches in Europe and arrived at Erik ten Hag. They have tried almost everything except lure Klopp or Guardiola to Old Trafford. In fact, the presence of these two characters clearly gnaws at United on a daily basis. They have lost substantial ground to City and Liverpool as well as Chelsea over the past decade. And yet, Manchester United has enormous cache and greater natural cash generating potential than almost all of their domestic competitors.

Of course, they were impatient, but now United are desperate. They’ve gone from Champions League certainties to Europa League strugglers and this has clearly affected the club’s income. It’s a vicious spiral and with each blow, the confusion grows and confidence erodes. Naturally, the owners get the blame and there’s some justification in that, but there’s been no shortage of cash spent on new players, but United have not spent wisely. The apparent obsession with veteran superstars is not something a club of their status should be focused on. At the moment, they have 37 year-old Cristiano Ronaldo sitting on the bench – this is not only something of an insult to CR7 but is also a waste of money.

You only need look at the grim faces of United’s c-suite seating to see the disappointment and dismay at the club at the moment, but the most telling scene is that of the fans leaving their seats and exiting the stadium in a display of disgust. It is arguably time for United to reinvent themselves and to realise they are no longer the powerful force they once were. They have a problem and the sooner they realise it cannot be solved by the transfer market or by continually changing coaches, the better. This really is a bad time for their colossal empire to run into trouble.