Soccer: Alex Ferguson and John Magnier moved significantly closer last night to ending their legal dispute with an out-of-court settlement but Manchester United's hopes of a return to anything approaching normality have been tempered by the mounting probability of a takeover bid from the American multi-millionaire Malcolm Glazer.

While lawyers for Ferguson and Magnier have reconvened to reach a compromise over the disputed breeding rights for the former racehorse, Rock of Gibraltar, Glazer is monitoring the situation and yesterday increased his stake in the club from 14.25 per cent to 16.31 per cent.

He now owns in excess of £100 million worth of shares and he and his three sons, Joel, Edward and Bryan, all executive vice-presidents of the American football team Tampa Bay Buccaneers, have plans to take control of United once the dispute between the manager and the majority shareholder is resolved.

On that count, Glazer will be encouraged that for the first time since last summer the respective legal teams have instigated talks about reaching a settlement rather than allowing the matter to go to the High Court in Dublin. Yet, even if that is successful, the Old Trafford establishment are entitled to feel a deep sense of foreboding about the threat of wholesale changes at the club.

Glazer's next step, once the Rock of Gibraltar dispute is effectively over, would be to hold talks with Magnier and his business partner JP McManus, plus their other associates at Cubic Expression, the investment vehicle the Irish businessmen have used to build a 28.89 per cent shareholding in the club.

Senior figures at Old Trafford are aware if Glazer were to gain Cubic's support, his chances of winning a vote of shareholders at an extraordinary general meeting would be dramatically enhanced.

Although pressure groups, such as Shareholders United, would be vehemently opposed to a takeover, they do not have the clout of the multi-million-pound investors who have built up the largest stakes in the club. For now, the only certainty is that the club is facing radical changes and that, along with Ferguson, the existing directors on Old Trafford's board are confronted by increasingly uncertain futures.

At the very least, Magnier and McManus have elevated themselves to such a position of strength that United's plc chairman, Roy Gardner, and the chief executive, David Gill, are already resigned to their highly influential detractors appointing up to three of their own representatives on to the board.

Glazer has been planning his strategy with the German Commerzbank in London and in the event of a takeover would almost certainly want his son Joel to take an active boardroom role. It is still weeks, if not months, away but there is also the possibility of bringing in directors to work alongside those of Cubic.

The other option is for Glazer to buy Cubic's shares, something that would make Magnier and McManus in excess of £50 million on their outlay and, doubtless to the intense relief of Ferguson, would end their involvement at the club for good.

A complicated saga would become much clearer if lawyers for Ferguson and Magnier can reach a settlement. Ferguson believes he is entitled to joint ownership of Rock of Gibraltar's stud fees, something that could be worth up to £100 million.

Talks broke down last summer when he apparently offered to accept between 15 and 20 per cent and Magnier's camp refused. The situation is still extremely delicate and it has been emphasised there is no guarantee of these latest discussions not collapsing.

The Glazer family are admirers of Ferguson and would represent a better option for the manager than anyone connected to Magnier, but they would be wrong to believe their involvement would be popular with groups representing the club's supporters and shareholders. On the contrary, they would face stiff opposition and maybe even the sort of protests that have been such an irritant to Magnier, McManus and their associates at Magnier's Coolmore stud farm.

Until today's race meeting at Bangor was called off, there were plans to disrupt a race involving one of their horses.

United's fans intend to protest at next month's Cheltenham racing festival, and on Tuesday 40 members of the so-called Manchester Education Committee, together with a pantomime horse, turned up at the city-centre offices of Kroll, the investigative firm hired by Cubic to look into business affairs at Old Trafford.