Amazon have become the latest company to be linked with buying Manchester United after the Glazers put the club on the market – but the asking price of around £7billion is believed to be unrealistic by industry experts.
United’s controversial owners announced last month that they would consider selling the club in a sensational statement that said they had begun a process to ‘explore strategic alternatives to enhance the club’s growth’.
The Glazers have been in power at United for 17 years since a leveraged £790million buyout in 2005, but their ownership has been deeply unpopular.
News that they would entertain a sale was greeted with delight among the club’s fanbase, but there was also apprehension over who may come next.
Investment firm Raine Group were appointed as United’s exclusive financial advisor for the process and are thought to want between £6bn and £7bn – a price those in the City of London say ‘surpasses reality’.
According to The Athletic, people close to the talks have cited Amazon, which holds broadcast rights for the Premier League, as a potential buyer.
It is not clear whether regulations which ultimately prevented United being sold to BSkyB in 1999 could impact any move from the global company, however.
‘Amazon declined to comment on rumour and speculation,’ Amazon, founded by the billionaire Jeff Bezos, told The Athletic.
Other companies to be linked with United include Apple, which denied reports they were keen on buying the club, while Ineos chairman Sir Jim Ratcliffe – Britain’s richest man – is also thought to be interested.
The Athletic also reports that experts in the City of London believe the £6bn-£7bn price tag is unrealistic.
Football Benchmark, a data and analytics platform which is an offshoot of accounting firm KPMG, has valued United at around £2.425bn.
The company’s founder and chief executive Andrea Sartori said in a recent report: ‘The gap between the rumoured transaction price and the theoretical value of Manchester United FC appears enormous.’
Sir Michael Moritz, the billionaire who co-authored former United boss Sir Alex Ferguson’s 2015 book ‘Leading’, wrote in The Times last month that the prices being bandied around for United were unrealistic.
It has also been reported that Joel and Avram, the executive co-chairmen of United, engaged in talks with US private equity firm Apollo over potential buying out their siblings and not to sell a slice of the club.
Joel and Avram Glazer are also thought to have been taken aback by suggestions it could cost between £1.2bn and £1.6bn to build a completely new stadium instead of developing Old Trafford, which has long been in need of a significant upgrade.
United fans hoping to see the back of the Glazers quickly are expected to be disappointed as there is not the same urgency to get a sale completed as there was with Chelsea, a process also overseen by the Raine Group.
Chelsea eventually sold for £2.5bn to a consortium run by Todd Boehly after sanctions were placed on previous owner Roman Abramovich due to Russia’s full-scale invasion of Ukraine.
Joe Ravitch, co-founder and partner of Raine, is leading the talks on behalf of the Glazers and the group are still aiming for a full sale of United in the ‘first quarter of 2023’ despite the complexity surrounding the process.
It comes after United released their latest financial figures which revealed the club is close to having debt of £1bn. The figures also showed that the Glazer family have not taken a dividend for the first time since 2016.
The owners were criticised for taking an £11million dividend out of the club in June, but the board of directors, which is mostly made up of the six Glazer siblings, did not approve the latest semi-annual payment to shareholders.
The figures show that United’s revenues rose by 13.6 per cent and the club is on target to make between £590m and £610m for the whole year, although it has made a pre-tax loss of £2.5m-a-week for the first quarter of 2022-23.
The quarterly results also revealed that the club’s cash levels had reduced by £96.9m, again mainly due to the summer spending, meaning a further drawdown on credit facilities was required.
The Athletic reports that some bidders will wait for United’s financial situation to get worse before they through their hat into the ring for the club.
The Manchester United Supporters Trust has called for fans to be engaged with the process to sell the club.
United fans have staged protests against the owners before matches and a group of supporters called The 1958 have also been targeting sponsors and other stakeholders with online campaigns.
Source: Daily Mail UK
