Analysts: Dream on United fans, Glazers don't have to sell
Reuters - Wednesday 10 March 2010, 16:36
CHICAGO - Manchester United fans hoping
another group can buy the Premier League champions from the
Glazers can stop dreaming, said analysts and bankers.
They stressed the American family does not need to sell one
of the world's most valuable sports clubs despite heavy debts.
As the Glazers' spokesman told Reuters on Wednesday:
"Manchester United is not for sale."
Fans and a group of investors called the 'Red Knights' who
are pushing for a change in ownership are, they said, forgetting
one thing - despite debts of 716.5 million pounds the Glazer family does not need to sell the club.
"It's a group of fans," one U.S. banker, who asked not to be
identified, said of the Red Knights group that includes former
English Football League chairman Keith Harris.
"You can't do a hostile takeover of a privately held
enterprise, so what are they talking about? Why would the
Glazers sell?" the banker said, calling the idea a
"fantasyland."
The Glazers, who also own the Tampa Bay Buccaneers National
Football League team, bought United in 2005 for about 790
million pounds despite opposition from debt-wary fans.
The Red Knights said this month they were looking into a
possible bid for the Old Trafford club that Forbes magazine last
year valued at $1.87 billion.
WON'T OVERPAY
The investor group, which also includes Goldman Sachs chief
economist Jim O'Neill, has pledged up to 1.5 billion pounds in
its bid, according to the London Times, but the Red Knights said
it would not overpay.
While the Glazers have stayed mum on a possible deal, United
chief executive David Gill said last week the Glazers would not
bow to pressure to force them out.
A U.S. banker working on the sale of English Championship club Sheffield Wednesday agreed.
"There's nothing forcing them to entertain selling," Robert
Tillis, CEO of Inner Circle Sports said of the Glazers. "They're
long-term holders. They've said that pretty consistently."
Those who know the family said the speculation swirls
because the Glazers are so tight-lipped, a strong family trait.
"Their history is buy and hold," said Marc Ganis, president
of Chicago-based sports consulting firm Sportcorp Ltd.
"Now, it
may be buy and refinance and hold, and then look at refinancing
again... but they retain their assets. They don't flip them.
'FORESEEABLE FUTURE'
"I have every expectation they're going to keep Manchester
United not just for the foreseeable future, but perhaps into the
next generation of family members," he added.
The Glazers, who have owned the Buccaneers since January
1995, launched a bond issue last month to raise 500 million
pounds in a bid to realign United's debts, which Gill has called
easily sustainable.
For fans thinking a local owner would fare better, Ganis and
several bankers said buyers would face the same pressure because
they would have to purchase the club at a higher price than the
Glazers paid and probably use debt to finance a deal.
The Red Knights have said any new ownership would "put the
club on sound financial footing."
Nevertheless, the Glazers have their supporters in the
United States, where they led the Buccaneers to a 2003 Super
Bowl championship although the NFL team has hit lean times in
the last several years.
The Glazers are also appreciated for their support of
charitable causes in the Tampa area, where a children's museum
sporting the family name is due to open later this year.
"These are folks that have made a lot of roots in the
community," said Rob Higgins, executive director of the Tampa
Bay Sports Commission, which promotes amateur sports activities
and received a $2 million commitment from the Glazers.
Analysts said selling United would likely be the last choice
for the Glazers.
"This is a primo property," said Robert Boland, professor of
sports management at New York University. "You don't want to
sell them if you can (help it)."