>From football to family fortunes United could be costly for the Glazers
Saturday July 2, 2005 The Guardian Being bundled out of Old Trafford in the back of a police van was probably not part of the original script, but no one can deny that those beige-trousered Glazer sons have had a good week. They've been pictured with Sir Alex Ferguson and Sir Bobby Charlton, and the top brass at the Premier League and Football Association have been cautiously welcoming. The sports minister, Richard Caborn, even used the word "open" about the Glazers, which is surely a first. It will probably be enough to take the heat out of fans' protests. If the new owners deliver on their promise of more Wayne Rooney-style signings, the stadium will be full and the replica shirts will sell. That's the fickle world of football. So far, so good for the Glazers, but nothing that has been said this week will persuade the financial community that the Americans can make a sensible return on their investment. The takeover price of £790m could not be justified by the club's recent trading performance and the financing, which includes interest rates of 20% on the hedge fund debt, is structured like a souped-up private equity deal. Joel Glazer addressed neither point in his interview with in-house TV channel, MUTV (aka: Pravda), saying merely that he is "comfortable" with the structure and that "debt can mean different things to different people". Maybe, but debt always implies a liability, and in the Glazers' case it is hard to see how they can service their new borrowings from United's cash flows. They have room for financial manoeuvre in the first two years, but the takeover documents show that the critical period is year three onwards. The Glazers are making the right noises about being hands-off owners, but football stories rarely run so smoothly. A bust-up with Ferguson, or more failure in the league and Europe, and the beige brothers will be pitched into centre stage. Sooner or later, one feels, they will have to invest more of the family fortune into United, or else find somebody else foolish enough to take on Roman Abramovich. Please use [email protected] for general discussion. To unsubscribe send a blank message (from the email account in question) to: [EMAIL PROTECTED] Join as a full member of IMUSA today: http://www.imusa.org/join.htm Yahoo! Groups Links <*> To visit your group on the web, go to: http://groups.yahoo.com/group/imusa/ <*> To unsubscribe from this group, send an email to: [EMAIL PROTECTED] <*> Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
