Reply to: Manchester United debt hits £716m

[AtW]

Or try watching another sport.

Do you like to watch boxing Brillo?

[BA to the Stars]

Could be worse, you could be a Pompey fan at this time

[swamp]

Bear with me, I don't follow football but...

Manchester United? The club everyone hates because they have more supporters globally than any other team?

The club whose shirts every other boy wears?

The club who changed its strip during the year so the fans would buy extras shirts?

The club that has millions of fans in China?

The club that was doing spectacularly well?

How on earth can they possibly be making a loss?

Because the chap that bought them (Glazer the man with beard), borrowed huge sums of money. Glazer then transferred his debts to the club and secured those debts on the clubs future earnings. Quite clever

Unfortunately to borrow all this money Glazer had to go to some pretty steep lenders -- hedge funds. They are charging a whopping interest and the debts are just piling up and are not getting paid off.

Last year Man U sold Ronaldo and made £80m, and they also won lots of trophies and they didn't buy any (expensive) players. They had a spectacular year football wise. But despite this they only showed a small profit (£40m), and their debts climbed by much more.

This year they have no players to sell. They may have to buy some players, and they may not win any trophies. If they don't get rid of their debts they may be banned from playing in Europe, and to cap it all their legendary manager is going to retire soon.

[BrilloPad]

Why dont the fans just go and support another team? Or try watching another sport. I like watching the girls do beach volleyball.

Hmm. Watch football or beach volleyball. Tough choice. But football is far more popular. Is the majority of the country gay?

[Peoplesoft bloke]

How on earth can they possibly be making a loss?

Ask Dodgy - it's what he calls "wealth creation".

[RichardCranium]

Bear with me, I don't follow football but...

Manchester United? The club everyone hates because they have more supporters globally than any other team?

The club whose shirts every other boy wears?

The club who changed its strip during the year so the fans would buy extras shirts?

The club that has millions of fans in China?

The club that was doing spectacularly well?

How on earth can they possibly be making a loss?

[Alf W]

The new Leeds.

Rooney's off to Barca for £70m to pay the 2010 interest bill. Berbatov will be off to Macc Town for a tenner.

Old Trafford will eventually be sold off to be turned into a huge Tesco.

At least it won't affect the Manchester based teams.

[LegendsWear7]

SAF will be retiring very soon. Apart from being nearly 70, from next season he will need Uefa Pro Licence.

I wonder whether the retirement of SAF would make it harder for Man U to raise funds.

I believe coaches with over 10 years continuous top-flight management experience are exempt and/or awarded the title automatically. Ferguson is a strong supporter of these qualifications.

I'm pessimistic about United's medium to long-term viability.

[swamp]

SAF will be retiring very soon. Apart from being nearly 70, from next season he will need Uefa Pro Licence.

I wonder whether the retirement of SAF would make it harder for Man U to raise funds.

[OrangeHopper]

It's quite impressive how Glazers have taken a debt free profiatble club and completely ****ed it over in such a short space of time. As for them doing a Leeds I think it may happen. As a United supporter I think it stinks how they have been put into the tulip in this way

They knew even before the sale was agreed that this is what was going to happen. The debt was just going to be put on the club's books.

[BoredBloke]

It's quite impressive how Glazers have taken a debt free profiatble club and completely ****ed it over in such a short space of time. As for them doing a Leeds I think it may happen. As a United supporter I think it stinks how they have been put into the sh1t in this way

[saptastic]

Are the Red Devils going to go bankrupt?

http://news.bbc.co.uk/1/hi/business/8470595.stm

couldn't have happenned to a nicer club.......

[Mich the Tester]

It is not stupid if you are the purchaser who is using the money leveraged from the business you are going to buy to buy the business.

Essentially money for nothing.

Working for Kraft

You see my dear lefty friend I’m a bit of an olde worlde capitalist who believes the purpose of a business is to attract capital from those who provide it voluntarily (people who give loans or buy shares), then set out to work to gain returns on that capital for the people who have provided it by providing a service or product whose utility is of such value for customers that they will pay for it. Put simply, a man gets a loan and uses his savings to buy chip shop and stock up on cod and potatoes, then makes delicious fish and chips and sells them to people who want to eat and tell all their friends about the fine new fish and chip establishment, then uses the profits to pay off the loan with interest and give himself a return on his investment. Of course, someone else might be a shareholder (who also put his savings in), and that person also rightfully expects and shall receive a share of the returns. Everyone happy.

But let’s say someone secures a mortgage on someone else’s chip shop and uses the money to buy that chip shop, then splits up the chip shop into ‘profit units’ like delivery moped, shop floor, kitchen, personnel and so on, pays himself a salary for doing so, then sells each ‘profit unit’ and cashes the money while the business goes bankrupt and the original lenders or shareholders (and of course employees) are left with nothing, then that person is a conman, a scoundrel and a cad. Or in common terms, a ‘private equity fund manager’.

[Mich the Tester]

It is not stupid if you are the purchaser who is using the money leveraged from the business you are going to buy to buy the business.

Essentially money for nothing.

Working for Kraft

Didn't this used to be called 'embezzlement'?

[The_Equalizer]

Not much good if the debt overwhelms the company after purchase.