The Glazer family are open to selling Manchester United.
The American owners are willing to listen to offers for the club they bought in a controversial leveraged buyout 17 years ago. If the club is sold, it is expected to be purchased by US investors.
A Manchester United statement confirmed plans to identify “strategic alternatives” and said the process will consider a number of options “including new investment into the club, a sale, or other transactions involving the company”.
Sky News had earlier exclusively revealed the Glazer family were preparing to formally announce their intention to examine potential sources of outside investment that could include a full-blown auction of arguably the world’s most famous football club.
Sources said on Tuesday investment bankers were being instructed by United’s owners to advise on the process.
Manchester United’s share price immediately rose by 17 per cent as a result, adding almost $400m to the club’s market capitalisation, according to football finance expert Kieran Maguire.
Man Utd statement
“Manchester United plc (NYSE:MANU), one of the most successful and historic sports clubs in the world, announces today that the Company’s Board of Directors (the “Board”) is commencing a process to explore strategic alternatives for the club.
“The process is designed to enhance the club’s future growth, with the ultimate goal of positioning the club to capitalize on opportunities both on the pitch and commercially.
“As part of this process, the Board will consider all strategic alternatives, including new investment into the club, a sale, or other transactions involving the Company. This will include an assessment of several initiatives to strengthen the club, including stadium and infrastructure redevelopment, and expansion of the club’s commercial operations on a global scale, each in the context of enhancing the long-term success of the club’s men’s, women’s and academy teams, and bringing benefits to fans and other stakeholders.
Executive Co-Chairmen and Directors, Avram Glazer and Joel Glazer said: “The strength of Manchester United rests on the passion and loyalty of our global community of 1.1 billion fans and followers. As we seek to continue building on the Club’s history of success, the Board has authorized a thorough evaluation of strategic alternatives. We will evaluate all options to ensure that we best serve our fans and that Manchester United maximizes the significant growth opportunities available to the Club today and in the future. Throughout this process we will remain fully focused on serving the best interests of our fans, shareholders, and various stakeholders.”
“The Raine Group is acting as the Company’s exclusive financial advisor and Latham & Watkins LLP is legal counsel to the Company.
“Rothschild and Co. is acting as exclusive financial advisor to the Glazer family shareholders.
“There can be no assurance that the review being undertaken will result in any transaction involving the Company. Manchester United does not intend to make further announcements regarding the review unless and until the Board has approved a specific transaction or other course of action requiring a formal announcement.”
The announcement of a review of financial options that could include a sale process would signal an end to years of speculation over whether the Glazers might be persuaded to offload a club which for the past decade have experienced an almost-unmitigated footballing decline.
United have not won the Premier League title since 2013, and have sacked a succession of managers in the aftermath of the retirement of Sir Alex Ferguson.
More recently, the club have become embroiled in a legal fight with Cristiano Ronaldo over an interview in which he questioned United’s ambition and lambasted the Glazers’ approach to owning it.
What are the potential outcomes?
It remains possible the family, which took control of United in 2005 in a £790m deal largely funded by debt, opt not to sell.
A partial sale to new investors, with capital being raised to fund an overdue redevelopment of Old Trafford, is one potential outcome from the process.
The Glazers have acknowledged the need for new infrastructure investment to transform the stadium into a genuinely world-class venue, while substantial funds are also required to enable the men’s team to compete once more at the top of the European game.
United’s valuation in a sale would inevitably exceed the roughly $2.15bn market capitalisation implied by their share price during Tuesday’s trading session on the New York Stock Exchange.
Reports in recent months have speculated any transaction would need to value the club at anywhere between £5bn and £9bn to persuade the owners to sell.
The Glazers listed a minority stake in the company in 2012 but retained overwhelming control through a dual-class share structure which means they hold almost all voting rights.
For more than 18 months, the club have been promising to introduce a modestly sized supporter ownership scheme that would give fans shares with the same structure of voting rights as the Glazers.
The initiative has, however, yet to be launched despite a pledge to have it operational by the start of the 2021-22 season.
It was one of a number of commitments made by Joel Glazer, United’s co-chairman, in the wake of the European Super League (ESL) debacle, in which the club played a pivotal role.
Manchester United were one of six Premier League teams to agree to join the project, which collapsed within hours of its official launch amid public and political acrimony.
In May 2021, United fans forced the postponement of a home match against rivals Liverpool after protesting against the ESL and the Glazer family.
‘Love United, hate Glazer’ has become a familiar refrain during their tenure, with supporters critical of a perceived lack of investment in the club’s infrastructure while the owners have extracted hundreds of millions of pounds-worth of dividends as a result of their continued commercial success.
If a formal sale process is initiated, attention will turn to the identities of potential buyers.
Sir Jim Ratcliffe, the Ineos billionaire who has supported United since childhood, said in August he was keen to buy the club but has since suggested English football’s elite names are overvalued.
Billionaires from around the world will be linked to bids, as will sovereign investors seeking to emulate the kinds of takeovers seen at Newcastle United – now owned by Saudi state-backed investors – and Paris Saint-Germain, which is Qatari-owned.
There will also be speculation the Red Knights, a consortium led by former United director and leading economist Lord O’Neill, could revive an attempt initiated in 2010 to take control of the club.
Significantly, the prospective auction of Manchester United comes as Fenway Sports Group, the owner of Liverpool, also weigh selling all or part of the club.
Simultaneous sale processes for two of English football’s so-called ‘big six’ – the others being Arsenal, Chelsea, Manchester City and Tottenham Hotspur – would be unprecedented.
One analyst said the timing suggested some investors believed the value of top clubs could be approaching its peak, especially against a backdrop of tough global economic forecasts for the coming years.
United’s announcement is also likely to be made during a World Cup fuelled by Gulf petrodollars, underlining the shifting financing of the global football industry.
Analysis: ‘A huge development at Manchester United’
Sky Sports News reporter Ben Ransom:
“It is a huge development when you consider the fact that the Glazers, in their time since they took over in 2005, have always said when asked that they are completely committed to this Manchester United ownership model, and are committed to the future.
“When you consider that just up the M62 it is a similar situation at Liverpool – two American ownership models potentially looking to move the clubs on – it’s a pretty remarkable moment.
“And it’s a real insight, I guess, into how they perceive the future and potential future difficulties of challenging at the top of the Premier League”.