Glazers’ role in United’s decline a significant factor

The owners have drained more than £1bn out of United since 2005 – similar to the amount Mansour has invested in City

Manchester United’s US co-chairman Avram Glazer  with Manchester United’s executive vice-chairman Ed Woodward. Photograph: Oli Scarff/AFP/Getty

Manchester United’s US co-chairman Avram Glazer with Manchester United’s executive vice-chairman Ed Woodward. Photograph: Oli Scarff/AFP/Getty

 

At Manchester United, the football club’s multilayered travails, the misery of the manager and the palpable sense of soullessness around Old Trafford are all stark reminders of how quickly the world can change.

United won the Premier League with a final farewell to Alex Ferguson as recently as 2013, and Sheikh Mansour bin Zayed al-Nahyan of Abu Dhabi bought their noisy neighbours only 10 years ago. Yet the long modern era, when United’s conveyor belt successes were further highlighted by City’s repeated mishaps, is already becoming a little hard to recall.

One United veteran lamented to me this week that City are not only eclipsing United now so vividly on the field, in the style and brio with which Pep Guardiola’s winning teams are playing, but in all areas.

United, owned and financially exploited by the Glazer family, and run by Ed Woodward, the former banker who orchestrated their debt-loading takeover, are floundering. Yet if they needed a model for how to do things much better after bungling their challenge, albeit fraught, of replacing Ferguson, they can see it across Manchester.

City, of course, is the far-fetched project of a sheikh from an oil-rich country subject to serious human-rights concerns which has its international image to curate when endeavouring to do the right thing in Manchester by the supporters and deprived neighbourhoods around the club’s stadium.

But, as is now widely acknowledged, whatever their motivation and soft power gains, and the strange structure of English football which allows such super-fuelled international funding into the people’s clubs, Mansour’s executives have gone about the project intelligently.

They appointed consultants at the beginning to assess the takeover and the most considered future shaping of a successful Premier League football club. They, the chairman Khaldoon al-Mubarak and his key advisors recognised that a director of football structure was vital, to administer the multimillion pound operation a playing side is, and try to recruit players in a planned way.

They understood that although modern football clubs are branding corporations, for their health they must embrace supporters’ sentimental loyalties.

Accepting that a football club is still considered a community centrepiece led them also to accompany the investment with public benefits, the community college and leisure centre built next to the €226m academy, old mills refurbished into good apartments for reasonable (ish) rent in Ancoats, and emphasis on social inclusion projects.

Transfer fees

The academy itself blasted United’s Carrington operation into inferiority, although United have belatedly upped spending on it to €27m a year. The club is finally now looking for a head of recruitment-style appointment, which will be aimed at avoiding the personalised process which blew up in José Mourinho’s resentment at Woodward this summer for refusing to sanction signing another centre half.

City’s supremacy, of course, has been facilitated by the extraordinary €1.47bn Mansour has spent since 2008, most of it has on paying huge transfer fees and wages for players.

But if there is one club besides Roman Abramovich’s Chelsea which cannot validly complain that it has been disadvantaged by this Abu Dhabi investment, it is United. The Glazers’ takeover has in fact drained out of United more than €1bn in interest, costs, fees and dividends since 2005, not too far off the amount Mansour has invested into City.

United continue to financially serve the Glazers every year. United published their latest accounts last week, with the football world agog at the then-latest episode in the war of the grumps between Mourinho and Paul Pogba, his underperforming stellar player.

It showed record income of €667m – still a lot more money than City’s €565m – for the operation of selling strata of sponsorships, which Woodward minted after he moved from the bank, JP Morgan, to United’s Mayfair office in 2005.

The accounts also showed that United’s borrowings remain at €550m from the Glazer takeover, which Woodward was instrumental in structuring with €593m debts loaded onto the club, including €311m high interest “payment in kind” loans.

This debt is more than financially manageable now after Ferguson’s successes saw United through the early Glazer years of eyewatering payments, but the 2017-18 finance costs were still €27m. That could have helped pay for one of the centre halves Woodward refused as short-term fixes on cost grounds.

Senior executives

The six Glazer siblings who collectively own 97 per cent of United’s voting shares were paid approximately €20m in dividends, the third year dividends have been paid. The total paid to them and the other financial investors was €24.8m, following €26m in 2016-17 and €22.6m the previous year, a total of €72m out of the club.

The salary packages paid to directors and senior executives, which includes the six Glazers, was €14.7m, following €13.5m in 2016-17 and €12.4m the year before.

A year ago, the Glazers’ holding company, Red Football, sold 4.3m shares in Cayman Islands-registered United, for €14.7 per share. That is a further €63m made by the Glazers from their heavily leveraged acquisition of a football institution.

Pogba, a World Cup winner for France, hankers after the freedom to play with more elan; Mourinho sulks about Pogba, being denied a defender and Woodward not supporting him publicly to assert his managerial authority.

These, though, are only the most visible symptoms of a cultural dislocation which radiates from the top in New York and Old Trafford, via the Cayman Islands.

– Guardian

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