MANCHESTER UNITED supporters’ groups have challenged the club’s American owners to clear up the mystery surrounding a deal to pay off the high-interest hedge-fund debt they have long feared could cripple United’s finances.
As the club confirmed no money had been taken from its coffers to clear the €259 million debt, which was accruing interest at an eye-watering 16.25 per cent, analysts speculated the Glazers may have simply refinanced it at a more beneficial interest rate.
But chief executive David Gill again insisted the PIK loan was not a matter for the club and claimed he did not know how they were financing its repayment. He was effusive in his praise for the Glazers’ approach and risked enraging fans further by saying they had run the club in the best traditions of Matt Busby.
Announcing results for the three months to the end of September, as they are obliged to do under the terms of the €642 million bond offer that sparked a huge wave of anti-Glazer protest in January, the club said: “The board can confirm that there has been no dividend of club cash.”
On a conference call to investors, chief of staff Ed Woodward promised the Glazers would not be taking a one-off dividend of up to €149 million, as they are permitted to do under the terms of the bond, from the club’s accounts in the coming quarter either.
Gill told the US-based satellite radio station SiriusXM the issue of a mandatory call notice signalling the Glazers intention to pay back the loans in full next Monday proved his long-held contention they were nothing to do with the club.
“I have been saying for years they were nothing to do with the club and they weren’t,” he said.
“They were accruing interest at roughly 16.25 per cent so they’re being paid down, and the only thing I know is that they are not using any of the club cash. We’ve got over £100 million (€118m) in the bank and they are not using any of the club cash.”
The Manchester United Supporters Trust, Must, believe it was pressure from the fans that stopped the Glazers taking the money out of the club in one-off dividends and charges to pay down the PIKs, as they were entitled to do under the terms of the bond offer. But as recently as last week, it is believed the Glazers sought permission from the PIK holders to take €59 million from the club’s cashflow to buy back that amount of the bond.
It remains unclear where the Glazers found the money to clear the loans which, had the interest been allowed to continue to “roll over” until they matured in 2017, would have stood at more than €705 million – on top of the €618 million bond secured on the club itself. The results showed overall quarterly losses had narrowed compared to the same period last year from €9 million to €6 million.
Must, the group behind the green-and-gold protests and allied to the group of wealthy investors known as the Red Knights, challenged the Glazers to explain themselves publicly. A statement said: “Now is the time for the Glazers to finally come clean and tell the truth about what is going on at Manchester United and what their plans are. What have they got to hide? Just tell the fans the truth.”
Gill backed the club’s owners, praising the way in which they have increased commercial revenues – up 24 per cent year on year according to the results.
He said while there was money available for players, United’s philosophy had always been to buy young talent and develop it.
“What Manchester United has been about ever since the 1950s when Sir Matt Busby was there was encouraging youth players, investing in the youth players and that’s always been part of how we’ve structured it.
“We’ve never tended to buy world-class players, we’ve made them into world-class players through Alex Ferguson and his coaches and playing in a great team.”
Gill has also claimed the club are developing a young squad. With the exception of €36 million striker Dimitar Berbatov, United have concentrated their resources on younger talent in recent transfer windows.
Guardian Service
