Manchester United: A case study on the dangers of 'public' sports teams

[Dauphin]

You're taking about gambling and risk spread now, which is a different topic.

That is to say, you are suggesting one outcome is preferable to another, when there is no evidence to support it.

[Imran Siddiqui]

you are suggesting one outcome is preferable to another

I'm saying MAYBE one is better than the other. And with the huge debt load that ManU will be saddled with, it isn't idle speculation.

[reds4ever]

Is it possile to only float 49% of a company when it turns into a PLC?

[Dauphin]

One may be worse, it may not be, but that doesn't lead you any closer to deciding which outcome is better for the club as many will see the flip side as better. Having debt can be healthy for a company, without see the gearing ratios I couldn't pass more comment.

[Dauphin]

Originally posted by reds4ever
Is it possile to only float 49% of a company when it turns into a PLC?

IIRC BP was like that for many years.

[Imran Siddiqui]

Originally posted by Dauphin
One may be worse, it may not be, but that doesn't lead you any closer to deciding which outcome is better for the club as many will see the flip side as better. Having debt can be healthy for a company, without see the gearing ratios I couldn't pass more comment.

That's my point! Since you can't be sure which is better for the club, the Chairman can make the argument that he assumed the long term growth of the club would be better without the takeover and that's why he did not recommend it. It allows for Gill to say no to Glazer without getting into too much trouble.

[Lawrence of Arabia]

they can just put in a poison pill and they wont have to worry about a hostile takeover.

[Urban Ranger]

Re: Re: Manchester United: A case study on the dangers of 'public' sports teams

Originally posted by Dauphin
Unless Glazer is being purely vindictive against the club and has money to burn he obviously believes that the move will benefit the club.

Not necessarily - he just thinks the move will benefit himself.

This takeover reminds me so much of a bygone era, where huge hostile takeovers were financed by high yield bonds, while the companies taken over usually ended up in various pieces.

KKR, anyone?

[Imran Siddiqui]

Not necessarily - he just thinks the move will benefit himself.

Indeed... what benefits Glazer doesn't have to benefit the club . After all, I'm sure ManU could make more money by spending less on transfers and raising ticket prices.

[reds4ever]

Originally posted by Imran Siddiqui

Not necessarily - he just thinks the move will benefit himself.

Indeed... what benefits Glazer doesn't have to benefit the club . After all, I'm sure ManU could make more money by spending less on transfers and raising ticket prices.

In some ways ManU's status as a PLC restricts its spending in the transfer market in that it must justify the expense of any new player to the shareholders (ultimeatly). Although United do spend big it's always on young players that won't depreciate in value before United can sell them. They don't have the freedom of the big continental clubs.

[Urban Ranger]

Originally posted by reds4ever
Although United do spend big it's always on young players that won't depreciate in value before United can sell them.

I dunno. Rooney caused them 25m pounds - you think somebody like Real Madrid is going to pay a higher price for him?

[Imran Siddiqui]

We are talking about Real Madrid here, UR .

[reds4ever]

DP

[reds4ever]

Originally posted by Urban Ranger


I dunno. Rooney caused them 25m pounds - you think somebody like Real Madrid is going to pay a higher price for him?

But they were left unable to buy for all the next season because that was all the board had allocated for 2 years . A question to ask is whether, if the roles were reversed, ManU would've been able to justify to the board/shareholders buying a 28 year old Real Madrid player that the manger wanted rid of, thats that Real bought in Beckham. Beckham's worth a lot in marketing so that skews it somewhat, but I think the point is the same, the money at Uniteds disposal is small and more tightly controlled as a PLC than if it were run like Real, Juve etc.

[Urban Ranger]

Originally posted by reds4ever
Beckham's worth a lot in marketing so that skews it somewhat, but I think the point is the same, the money at Uniteds disposal is small and more tightly controlled as a PLC than if it were run like Real, Juve etc.

I wasn't disputing that point. I was wondering if Rooney would turn out to be an investment, i.e. would heincreasein value, or would he be somebody like Liverpool's Hesky?