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Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 8:50 amby Beeks
Manchester United’s owners agreed to pay off a payment-in-kind loan worth about 220 million pounds ($353 million), according to a corporate filing by the English soccer club.
Red Football Joint Venture Ltd. will “prepay 100 percent from the outstanding loan on Nov. 22,” the team’s parent company said. The document, called a voluntary free-payment notice, was signed Joel Glazer, co-chairman of Red Football, and was sent to the holders of the loan. Philip Townsend, a spokesman for Manchester United, declined to comment.
The Glazer family, which also runs the National Football League’s Tampa Bay Buccaneers, bought the 18-time English soccer champion in 2005. United supporters have protested against owners because of the debt they’ve added to the team. The Glazers were shouldering 16.25 percent annual interest charges on the PIK debt because of concern they’d face fans’ anger if they used the soccer club’s cash to pay off the loans.
“From a portfolio manager’s standpoint, it’s tantamount to ‘the Grinch who Stole Christmas,’” said Mark Baker, chief executive officer of ADM Capital Europe. “The Glazer’s are eliminating arguably the best asset in the European High Yield universe from a risk/return perspective. Delighted for the fans but our portfolio will miss the 16.25% coupon.”
The Glazers aren’t going to take any money out of the club to pay down the debt. With PIK loans, interest rolls up annually and increases the amount owed.
The Glazers bought the 18-time English champion for 790 million pounds. In January, they converted a bank loan secured against the team into a 526 million-pound bond. Under the bond’s terms, the Glazers could make a one-time withdrawal of 70 million pounds from the club to pay down the PIK loan.
Anti-Glazer protests increased after details of how the owners were financing the once debt-free club were revealed in the bond prospectus. Thousands of supporters took to wearing the green and gold colors of the team’s original incarnation, and a group led by Jim O’Neill, chairman of Goldman Sachs Asset Management, emerged as a potential buyer.
The PIK loan issued in August 2006 to Red Football Joint Venture is held by fewer than 10 investors, mainly hedge funds. The facility started out as a 138 million-pound loan, accruing annual interest of 14.25 percent. That rose to 16.25 percent after the club breached a debt-to-earnings ratio agreement. The Glazers bought back between 15 and 20 percent of the loan in 2008.
The PIK loan to United was due to mature in 2017. If the Glazers had held the debt until then, they would have owed almost 600 million pounds at the current interest rate, according to Bloomberg calculations.
On Oct. 8, the team announced a record loss of 83.6 million pounds for the year ending June 30. Much of that was attributable to interest payments and costs related to replacing long-term bank debt with the bond. Sales reached a record 286 million pounds. United release first quarter results today.
Since the Glazers’ purchase, United has won three domestic league titles and took the Champions League in 2008.
The club has increased revenue from various sources since the takeover, notably in commercial operations. A London-based sales team has negotiated sponsorship and partnership deals in industry sectors across the world.
United is currently third in the Premier League, three points behind leader Chelsea and one behind Arsenal.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 9:04 amby Beeks
Though looking on the Caf it seems this debt had little to do with the club apart from the rag fans worrying they would use the club to pay it off...It seems the club debt will pretty much stay the same
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 9:24 amby The Man In Blue
Fuck them.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 9:38 amby Beefymcfc
The debt is linked directly to the club so unless the Glazer's have just found a pot of gold the money will be coming from somewhere within the club. They may say it is their own money but in reality the club is their's so it is their own money. Alternatively, it could come from their personal accounts, but as we all know, that is only money ripped off from the club through various schemes.
I've got a feeling that they may be getting ready to jump ship and making the club more saleable without the massive interest rates that the PiK accrued. It was estimated that if it carried on until to the end of it's life in 2017 it would cost the Glazers over 600 million to pay it off.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 10:07 amby ronk
They couldn't afford not to pay it. I'd say they've used the funding from the bond, scum cash reserves, any cash they could scrape together themselves and borrowed the rest.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 1:34 pmby lets all have a disco
Great! They'll dig themselves out of it or someone will buy the club and deal with it.
That second option might have already happened.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 1:48 pmby Swales4ever
... tic toc ...
.... :-)
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 6:53 pmby Blue Since 76
Beefymcfc wrote:The debt is linked directly to the club so unless the Glazer's have just found a pot of gold
They do look like leprichauns, god bless 'em.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 7:08 pmby Crossie
Some daft cunt will just buy them for 1 billion pounds and it will make headlines around the world, giving Fergie/Mourinho £200 million for a new squad.
I wish someone could draw a picture of their debt structure with a big red mark for when it reaches seriously fucked up sell sell sell limits.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 7:35 pmby Wonderwall
rags I spoke to today were not impressed by this little announcement as they think it spells bad news. If it was good news for the club, they would have PR'd the hell out of it to knock the Norwich brigade into touch. The media would be all over it like flies around shit, it's another little work around and reshuffle of debts to keep a creditor happy and change the housekeeping from one loanshark to another.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 8:24 pmby Beefymcfc
Wonderwall wrote:rags I spoke to today were not impressed by this little announcement as they think it spells bad news. If it was good news for the club, they would have PR'd the hell out of it to knock the Norwich brigade into touch. The media would be all over it like flies around shit, it's another little work around and reshuffle of debts to keep a creditor happy and change the housekeeping from one loanshark to another.
Poor sods, I bet they can't see the woods for the tree's at the moment.
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 9:12 pmby Ted Hughes
I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 9:31 pmby ronk
Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
What do you think, Hicks or Gillett?
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 10:26 pmby Swales4ever
ronk wrote:Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
What do you think, Hicks or Gillett?
LOL!
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 10:33 pmby Beeks
Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
Nah Ruxpin..they want to milk that cash cow for as long as humanly possible
Re: Glazers pay off proportion of debt?
Posted:
Tue Nov 16, 2010 10:38 pmby mcfc1632
Beefymcfc wrote:The debt is linked directly to the club so unless the Glazer's have just found a pot of gold the money will be coming from somewhere within the club. They may say it is their own money but in reality the club is their's so it is their own money. Alternatively, it could come from their personal accounts, but as we all know, that is only money ripped off from the club through various schemes.
I've got a feeling that they may be getting ready to jump ship and making the club more saleable without the massive interest rates that the PiK accrued. It was estimated that if it carried on until to the end of it's life in 2017 it would cost the Glazers over 600 million to pay it off.
Isnt the PIK debt is down to them?, whereas the £500m bond issue is on the club - but the expectation of scum fans has been that they will milk the club to make their loan payments. The devil will be in the detail here - of course at 16.25% interest anyone would want to get this paid to reduce the exposure - but unless they won the Euromillions and others then this must logically be simply a refinancing deal at lower interest rates.
Also I would not be surprised if there is some scam - such as they own a good percentage of the PIKs themselves they have been able to do this transaction in a way that gives them a lump - we will need to see the detail come out - certainly hpoe it is not a straightforward payment
Re: Glazers pay off proportion of debt?
Posted:
Fri Nov 19, 2010 2:12 pmby simon12
Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
Funny as I`ve just had a call off a rag mate who said he`s heard on "good" authority that they`ve been sold. I hope it`s wishful thinking. Don`t know if it`s bollox or not and neither does he.
Edit: Looks like the rag dicks are a bit confused where their ground is. HAHAHA blackburn HAHAHAHA
Re: Glazers pay off proportion of debt?
Posted:
Fri Nov 19, 2010 2:17 pmby Beeks
simon12 wrote:Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
Funny as I`ve just had a call off a rag mate who said he`s heard on "good" authority that they`ve been sold. I hope it`s wishful thinking. Don`t know if it`s bollox or not and neither does he.
Bollocks
There was a rumour that Epson (Printing company) had bought them going round the net but it's been quashed by the club themselves...they are just sponsoring them
Re: Glazers pay off proportion of debt?
Posted:
Fri Nov 19, 2010 2:18 pmby simon12
IanBishopsHaircut wrote:simon12 wrote:Ted Hughes wrote:I hope I'm wrong but it smells like the 1st steps of a takeover to me unfortunately.
Seeing as we can't dare to even try & beat the fuckers now, what's it going to be like if they actually start signing players again?
Funny as I`ve just had a call off a rag mate who said he`s heard on "good" authority that they`ve been sold. I hope it`s wishful thinking. Don`t know if it`s bollox or not and neither does he.
Bollocks
See edit mate....Balckburn HAHAHA
Re: Glazers pay off proportion of debt?
Posted:
Fri Nov 19, 2010 6:41 pmby bluej
mcfc1632 wrote:Beefymcfc wrote:The debt is linked directly to the club so unless the Glazer's have just found a pot of gold the money will be coming from somewhere within the club. They may say it is their own money but in reality the club is their's so it is their own money. Alternatively, it could come from their personal accounts, but as we all know, that is only money ripped off from the club through various schemes.
I've got a feeling that they may be getting ready to jump ship and making the club more saleable without the massive interest rates that the PiK accrued. It was estimated that if it carried on until to the end of it's life in 2017 it would cost the Glazers over 600 million to pay it off.
Isnt the PIK debt is down to them?, whereas the £500m bond issue is on the club - but the expectation of scum fans has been that they will milk the club to make their loan payments. The devil will be in the detail here - of course at 16.25% interest anyone would want to get this paid to reduce the exposure - but unless they won the Euromillions and others then this must logically be simply a refinancing deal at lower interest rates.
Also I would not be surprised if there is some scam - such as they own a good percentage of the PIKs themselves they have been able to do this transaction in a way that gives them a lump - we will need to see the detail come out - certainly hpoe it is not a straightforward payment
The way I understood it (which is probably incorrect), the PIKs are on their heads, there's a good chance they've taken money out of united + loaded some extra loans (with lower interest rates) on the club. Newspapers are claiming that the money hasn't come from the club but with the Glazer's other businesses going tits up they must have either taken money from united, got extra financing from somewhere, or both.