I cant get behind the paywall on Athletic, tried looking at that earlier. But that bit in bold will do for now. Good news. Looks like he misses this transfer window so we wait until the summer. In the mean time it'll be interesting to see whether he backs ETH.
Why Joel and Avram could retain control of Manchester United if other Glazers sell up By Laurie Whitwell Apr 28, 2023 86 Joel and Avram Glazer would remain in charge of Manchester United even if their siblings Kevin, Bryan, Edward and Darcie sell their portion of the football club. There is a specific clause in Manchester United stock that means, should Joel and Avram be left as the only Glazer representatives following the club’s exploration of “strategic alternatives”, the two brothers would remain in overwhelming control — unless a new agreement is reached. When the Glazers launched United on the New York Stock Exchange, they protected themselves by inserting a mechanism that essentially blocks anyone other than family members from owning what are known as ‘Class B’ shares. At the point any Class B shares are sold, they automatically convert to ‘Class A’ shares, as happened when Avram cashed in five million in March 2021 at a price worth more than £70million, and Kevin and Bryan traded nine and a half million, equating to £137m, in October 2021. Crucially, Class B shares hold 10 times the voting rights of Class A shares, so are the key to making decisions at United. Only Class A shares are traded on the market. A look at the numbers shows why Joel and Avram would, without fresh alterations to the share structure, remain in charge should Kevin, Bryan, Edward and Darcie relinquish their stock in United. There are currently 54,537,360 Class A shares, and 110,207,613 of the more powerful Class B shares. Of the Class Bs, Joel has 21.9million, Avram has 16.6m, Kevin has 15.9m, Bryan has 19.9m, Edward has 15m and Darcie has 20.9m. Joel also has 1.7m Class A shares, meaning his overall vote total is 221m. Avram’s voting influence is the equivalent of 166m (16.6m multiplied by 10). Together, they have 387m votes. The four other siblings — said to want a full sale — equate to 685m in votes. But this would be divided by 10 if they leave Glazer hands, and would therefore be equivalent to 68.5m. On the market currently, held by various investors, are 54.5m. Added together, the Class A shares would hold 123m votes. (Darcie also has 603,806 Class A shares, but this is negligible in the grand scheme here.) In the event that the other siblings relinquish their stock, Joel and Avram would hold 387m votes out of 510m, equalling 75.8 per cent when it comes to decision-making, easily enough of a majority to run the club as they see fit. In other words, new minority investors would not have control unless they specifically agreed a deal giving them more than one vote per share. Man Utd shares owned at September 2022 SHAREHOLDER CLASS A SHARES PERCENTAGE CLASS B SHARES PERCENTAGE PERCENTAGE OF TOTAL VOTING POWER Avram Glazer 0 0 16,606,979 15.07% 14.38% Joel Glazer 1,707,614 3.23% 21,899,366 19.87% 19.11% Kevin Glazer 0 0 15,899,366 14.43% 13.77% Bryan Glazer 0 0 19,899,365 18.06% 17.23% Darcie Glazer Kassewitz 603,806 1.14% 20,899,365 18.96% 18.15% Edward Glazer 0 0 15,003,172 13.61% 12.99% Edward Woodward 551,486 1.04% 0 0 0.05% In the fine print of documents related to United shares, it states “affiliates” of holders of Class B shares are exempt from the automatic conversion to Class A shares. There is some dispute over the meaning of this — could anyone buying enough shares count as an affiliate? — but the pervading interpretation is that it simply allows the Glazers to place shares with other family members or companies they own without losing influence. Raine, the US bank handling the sale of United, has set a deadline of today at 10pm (UK time) for the next round of bids to buy the club. Sir Jim Ratcliffe and Sheikh Jassim are the two contenders for ownership, while US private equity firms Elliott, Carlyle and Ares are in talks about minority investment. One person who may wish to see a full takeover at the price being mooted is Ed Woodward. United’s former chief executive holds 551,486 Class A shares, which at the market price equates to $11.4m (£9.2m). If the club is bought for £5.5bn, meaning $35 per share, that lump sum jumps to $19.3m. Laying out how the Glazers’ shares work is important in light of reports that Ratcliffe’s proposal involves buying a stake of slightly more than 50 per cent, with about 20 per cent remaining in the possession of Avram and Joel. Ratcliffe’s camp and Raine declined to comment on these reports. Sources close to the situation, who will remain anonymous to protect relationships, insist Ratcliffe would only want United if it came with control. It has been stated the other 30 per cent would stay with investors, as is the case now (the Glazers own 69 per cent of United, with 31 per cent in the hands of financial firms and others). In this scenario, Ratcliffe would have to negotiate a new share system with Joel and Avram. In its current guise, his 50 per cent of United, with Class A shares, would amount to 82.3m votes. Joel and Avram’s 20 per cent, as Class B shares, would equate to 329.5m votes (32.95m multiplied by 10). It would be the same situation regarding the financial institutions that have been in talks over minority investments. please log in to view this image Ratcliffe wants control with his bid (Photo: Peter Byrne/PA Images via Getty Images) Given the way the Glazers’ Class B shares convert to Class A shares, thus diminishing the voting power, there does not appear to be an economic justification for a private equity firm paying the kind of money for shares that is being spoken about by bid proposals looking for full control. A £5billion enterprise value — the total value of a company, including debt — has been mentioned as the level Ratcliffe and Sheikh Jassim could reach to buy United. That £5bn equates to $32.5 per share, far above the current price of $20.57 on the New York Stock Exchange. It seems inevitable any minority investor would look to gain financial guarantees in other ways. One path would be ‘preferred equity’, which lies between debt and common equity in the pecking order of ownership. Debt is in the hands of banks, with repayments at an interest rate. Common equity is in the hands of shareholders, who can sell stock when the price rises. Preferred equity comes with aspects that are negotiated between seller and buyer in each individual case. An example would be guaranteed dividends. These are typically six to nine per cent, which is a lot of money when the numbers are this high. On a $1bn investment, it equates to $60-90m a year going out of the club. This finance model would load more liabilities onto the club — in effect, a second leveraged buyout. If they are used simply to buy out Kevin, Bryan, Edward and Darcie, the club would still need to raise separate funding for stadium and training ground improvements. Barcelona recently secured $1.6bn of funding from 20 investors to upgrade the Nou Camp. please log in to view this image GO DEEPER Special report: Inside the chaos and controversy of Barca's Camp Nou rebuild It is perhaps worth noting that Ratcliffe’s reported proposal does not seem to add additional liabilities on the club, which is a major positive over minority investors gaining preferred equity. It is not, however, the debt-free offering proposed by Sheikh Jassim’s team. United’s share price reflects the market view that a full takeover appears unlikely at this stage, given these various methods for Joel and Avram to remain at the club. Stock has been trading just above $20 per share, way below the implied $32.5 per share value of a £5bn bid. The clause that converts Class B shares to Class A shares means their value is hugely diminished and also explains why the four siblings keener to sell have not done so of their own accord. They will get most value from their shares by selling with the control carried through, rather than on the market. please log in to view this image There remains a question as to why Joel and Avram would stick around without control. It seems the only possible explanation is that they would view United as having untapped value, which could be extracted in years to come. It is said they see the potential scale of the club reaching £10bn. Holding onto their shares now and selling later for that engorged price could be worthwhile. Many observers doubt such a fee is realistic. But Dr Rob Wilson, head of department at Sheffield Business School, anticipates big growth. He says: “Football is different. When you take the enterprise value you have to look at the upside the football club can generate. We are starting to play around with the methodology that considers more than just the sporting performance. You’re into things like digital footprint, extended reach. United’s digital footprint is enormous.” Neil Joyce, chief executive of CLV Group, a data and insights company for sport and entertainment, estimates United are missing out on £100m per year on fan-delivered income. “That’s looking at the fans they are not monetising across the globe,” Wilson says. “Put that into recurring revenues and you start to increase the enterprise value of the football club. “The valuation I’m coming up with is between £6-8bn. That’s being able to extract value from that additional footprint. But when we cast forward even further and couple it with this year’s moderate on-pitch success, what we have seen with Manchester United as a result of their historical performance is that they’ve been able to extract more money through shirt sponsorships and partners. We may look back on this in a few years and think £6bn is about right. “The Glazers will want a value that aligns with where they believe the club can go. I don’t think £10bn is cloud cuckoo land — we may see that if the trajectory of the sector continues on the line it’s on.” Whether all this posturing is so that the Qatar bid, led by Sheikh Jassim, raises its offer remains to be seen. Sheikh Jassim only wants full control of the club, meaning all shares, Class B and Class A, would be purchased.
The Premier League and the FA have approved Sir Jim Ratcliffe's proposed bid to buy a minority stake in Manchester United; Ratcliffe, who is the owner of INEOS, is closing in on completion of his deal to buy 25 per cent of the club. Good news
considering some of the owners who have previously been "approved" it would have been a bit odd if he had been refused .
For me, and I think most other United fans, it's more the case it couldn't come quick enough. Now we can move on and effect real change.
i think technically it's not done yet as he has to buy the shares on the NY stock exchage but with the share price he is offering shouldn't be a problem
INEOS/Ratcliffe getting on with things sharpish? Looks like the ground will be an expansion rather than a rebuild.
Deal done - light the blue touchpaper, stand well back and here we go..... "This marks the completion of the transaction, but just the beginning of our journey to take Manchester United back to the top of English, European and world football, with world-class facilities for our fans..
I thought for a second you wrote that before I saw the quotes, and thought that's going a bit over the top
From my new best mate Jim - Sir Jim Ratcliffe has echoed two of Sir Alex Ferguson’s famous lines by vowing to knock “noisy neighbours” Manchester City and Liverpool “off their perch” within three years as he set out his vision to rebuild Manchester United.
There are already a number of good things happening at the club from on field perspective.. integration of solid young players into the squad! That is by far ETH’s best achievement so far. It gives Ratcliffe good substance to build on for the future. It ensures we no longer have to be mugs in the transfer market as they continue to rebuild the infrastructure.
