This is the first in a series of pieces I will be writing on the finances of football teams. Today, I assess Manchester United in an deep dive report. The world’s biggest football club is 90% privately owned, with the remaining 10% trading publicly on the New York Stock Exchange.

I have never liked Manchester United.

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I guess it’s natural. Growing up, nearly all of my friends supported either Man Utd and Liverpool. And they always won. For years, they won and they won and they won some more.

While the number of supporters for Man Utd has somewhat dissipated, now that they are led by Harry Maguire rather than Roy Keane, my contempt for them remains as strong as ever – borne out of jealousy, self-loathing and perennial disappointment with my own football team of choice (Newcastle).

So, with the caveat of my potentially egregious bias out of the way, let me (objectively, and not subjectively at all) assess the Manchester United ownership model, its stock price, how the stock has performed this year and how so much of this sordid tale sums up what is wrong with modern football.

Well, in a literal sense, not really. Man United were privately owned for nearly 100 years, before going public in 1991 (FYI – being a proud Newcastle United fan, I will be refusing to give in to the discriminatory habit of referring to Man Utd as “United” in this article).

Man United were then traded publicly thereafter for 14 years until Malcolm Glazer completed a takeover of the club for £800 million ($1.4 billion at the time) in 2005. Man Utd were, once again, a private company.

Glazer was from New York, born to Lithuanian parents.  He was only a teen when his father passed away, leaving his mother to care for him and his six siblings. Selling watches door-to-door to support the family, he eventually flipped this hustle into a successful watch repair business before moving into real estate. A charming backstory, but this little fella is the villain of this piece, so don’t get too attached.

Glazer grew his empire and became immensely wealthy. He made his first foray into professional sport in 1995, when he bought the Tampa Bay Buccaneers of the NFL for $195 million. Today, Forbes estimates the franchise is worth $3.68 billion (that’s a tidy 19X on his investment). They are currently led by one of the greatest to ever play the game, quarterback Tom Brady – whose most recent visit to Manchester was only a few months ago.

🐐 x 🐐 @Cristiano 🤝 @TomBrady #MUFC pic.twitter.com/GFTkJ8B84W

Malcolm Glazer passed away in 2014 after being in poor health for many years, splitting his 90% Man United stake evenly between his six children (more on how his stake was diluted down to 90% to follow).

While the Glazer family is more popular Stateside, where the Buccaneers won the SuperBowl in 2003 and again last year, their reign has been controversial in Manchester.

It stems from how the late Malcolm Glazer purchased the club. He bought his first shares in the club in 2003 before completing the takeover in 2005 for a total of £800 billion. He took ownership via a leveraged buyout, a very common method in the world of public markets, but one that divides opinion in the sports world.

This means that he took out a large loan to complete the purchase; a loan that was secured by the assets of the club. Man United, previously without debt, now had £660 million of debt. This debt was split between the club and a holding company used to complete the purchase.

However, crucially, Man United were responsible for paying the interest. It is this interest – as well as debt – which has fuelled the anger against the Glazers.

Before we get to the interest (and dividends – that’s where it gets really fun), it’s important to mention the final twist in the ownership tale. The Glazers refinanced the debt via half a billion of bonds, as well as floating 10% of the club on the New York Stock Exchange in 2012. So, since 2012, we have the added wrinkle of being able to track the share price of the club. Fun!

The club’s net debt had risen as high as £773m in 2010, but the Glazers paid down a hefty chunk of it following a bond issue of half a billion. Following the IPO, the debt fell even further, close to £200m. But over the past couple of years, as clubs worldwide struggled with the impact of COVID decimating matchday revenue, lowering TV hauls and other effects, it is back up to £592 million.

This is where things get nastier than a Granit Xhaka two-footer.

Man United have paid £743 million in interest since Malcolm Glazer’s leveraged buyout in 2005 – a fact fans are aggrieved with given the debt currently sits at £592 million, only marginally lower than the £660 million at the time of the takeover.

Compared to other clubs in the Premier League, Man United’s debt is behind only Chelsea (£1.5 billion) and Tottenham (£854 million). However, Tottenham’s debt is to fund their swanky new stadium – one I visited last year and was shocked to see they pour pints that fill from the bottom of the cup via some sort of revolutionary magnetic device (it was better than the football at least, a drab 1-0 victory that made me pine for the not-so-free-flowing football of Steve Bruce).

Meanwhile, Chelsea’s £1.5 billion loan was provided interest-free, a questionable business move but one which highlights the growing tension between the passion of football fans and the reality that this is also a very real business.

So the debt, while not otherworldly by any means when compared to the size of Manchester United. Forbes estimate it at a little over $4.5 billion, although considering Chelsea was recently sold for $5.25 billion, I think the Forbes gang need to re-check their numbers. Either way, the debt balance is not significant when looking at the revenue and balance sheet.

But it’s still debt. In the Glazers’ detractors’ eyes, the interest payments on the debt should be used to funnel money into infrastructure such as the stadium, academy and magnetic pints, rather than taking “Man United’s money” out from the club. A fair point.

But when you look at capital expenditure, which is the best way to gauge this investment, Man United are behind only Tottenham, Man City, Liverpool and Leicester over the last decade – coming in a very respectable 5th. I plotted this graphically below (note I excluded Tottenham for scale purposes as their $1.4 billion spend).

Sidebar: For the fans who complain that Old Trafford is decrepit, may I suggest you take a visit to St James’ Park. Not even a lick of paint was within the budget for Newcastle, who spent a measly $7 million over the last decade. That’s genuinely impressive stuff, Mr Mike Ashley. But I digress.

Of even more substance, however, is the criticism of the dividends. The Glazers are the only owners in the Premier League to pocket dividends. They have taken out £133 million in dividends since over the last decade. In June, a payment of £11 million in dividends was made, the bulk of which the Glazers pocketed.

The crux of this issue is quite simple.

Football is a cultural phenomenon. It is so entwined in UK life – indeed, life around the world. I grew up in Ireland yet so much of my childhood was spent sitting on my couch watching Newcastle games, or Leeds and Arsenal games – my Dad has the unfortunate ignominy of supporting a team that has been even less successful than Newcastle over the past few decades, while my brother is an Arsenal fan (it’s been a long 25 years).

I have travelled to many games in St James’ Park. I have joined the Toon Army in Manchester, London, and elsewhere, and one day I hope to travel to Europe to see them play in the Champions League.

This experience is not exclusive to Newcastle, of course. I sent my friend Conor – as passionate a Man Utd fan as they come – a message to pick his brain on the Glazers as I put together this story. Back came a 13-minute voice message filled with heartache, anger and a pining for past glory.

Football is important to people. It brings people together. I keep in touch with friends through it, visit my Grandparents to watch it, and chat at water coolers about it. It is the same with millions around the globe.

But unfortunately, it is also a business – and that is the problem here.

The leveraged buyout model is a standard takeover seen time and time again in financial markets. And from a business perspective, why would the Glazers not extract value from the club in the form of dividends, for both themselves and the public shareholders?

And looking at average attendances below, Old Trafford is always 99% full – aside from when worldwide pandemics get in the way – so why would the Glazers, as a business decision, invest more in the stadium?

The sad reality is that there is no reason to do so. Just like if you owned a company yourself, you would run it to maximise profit. It’s just the gut-wrenching truth that football clubs are not like any other companies. They are vitally important to people, friends, families and countries.

Just look at the determination of authorities to get football back on the TV during the COVID lockdowns, in order to provide people with an outlet, to see evidence of this.

Perhaps, one could argue, that spending on infrastructure would improve the performance of the club, leading to a greater ability to attract players and potentially more on-field success.

But until recently, the narrative that Manchester United can attract the best players in the world has been unquestioned. Angel Di Maria, Cristiano Ronaldo, Casemiro, Alexis Sanchez and Jadon Sancho are just a few highly sought-after talents who have arrived over the last few years for mega-money.

Failure to qualify for the Champions League is definitely a commercial consequence of neglecting footballing performance, however. Then again, from the Glazers’ point of view, Man Utd have not really been lacking here.

Last year was seen as the most disastrous season in recent history for the club when they finished in sixth place, missing out on a coveted top 4 slot and the accompanying revenue that comes with Champions League qualification. But the year before, they came second and hence they competed in Europe’s premier competition just last season, netting €77.3 million in the process.

Knocked out by Atletico Madrid in the Round of 16 following a 1-0 victory in the second leg at Old Trafford, Man Utd did earn less prize money than was on offer. For contrast, Liverpool, their English rivals who reached the final of the competition, earned €66.3 million compared to Man Utd’s €20.5 million in prize money.

Overall, Liverpool outearned Man Utd €117.6 million to €77.3 million, a margin of €40.3 million. While that’s a hefty chunk of change (even if barely enough to turn the light on in your home this winter), in footballing terms this is not much for a financial behemoth like Manchester United.

This season, however, there will be no Champions League at all – but rather the ignominy of second-tier European competition on Thursday nights, aka the Europa League. It’s kind of like going to the bar for a pint and being told they only serve bottles. It’s just meh.

“Glazers Out” is the rallying cry from Manchester United fans to try oust the leaders from their beloved club.

They argue that given the dividends, interest and other disrespect of the club that there is no option anymore but for the Glazers to walk away.

The campaign was launched in the aftermath of the takeover in 2005, although only by a minority. They even created a spinoff club, called FC United Manchester. The club is the second largest fan-owned club in the UK (by number of members, behind only Exeter City FC) – showing how rare this model is in English football (I will write another piece on German ownership in future because that is a completely different box of frogs).

Each member owns one share in the spinoff Manchester club, with these shares granting equal voting rights. It is therefore democratically run via these members – in a way, it kind of sounds like a Web3 use case, now that I write about it (hey, any excuse to wedge some crypto in).

In every way, this model is the antithesis of Manchester United and the Glazer model. This juxtaposition extends even to on-field success over the last decade, with the club sealing three consecutive promotions and reaching the second round of the famed FA Cup in 2010, only 5 years after its founding – all while Man Utd have descended to become one of the laughing stocks of English football.

They now compete in the seventh tier of English football, although have been embroiled in controversy themselves at times.

I’m sorry about that. It is a bit sad, that part, but I wonder just how big a United supporter they are. They seem to me to be promoting or projecting themselves a wee bit rather than saying, “at the end of the day the club have made a decision, we’ll stick by them.” It’s more about them than us.

This was only a minority, however. With Alex Ferguson still at the helm, Man Utd continued to move from strength to strength, winning five Premier League titles in seven years and a Champions League against Chelsea in 2008, after John Terry elected to employ a unique “two-footed slide tackle” technique in the penalty shootout. Good times.

The post-Ferguson era has been rather turbulent, however. A series of managers and high-profile signings have floundered, and the former perennial winners fell away. The fact that this coincided with the rise to elite status of cross-city neighbours Manchester City, and the return to form of arch-nemesis Liverpool, made it an even more bitter pill to swallow.

And the “Glazers Out” campaign has since moved beyond a minority of dissenters.

With Wayne Rooney, David Beckham and Eric Cantona now condemned to the past, the new generation of Paul Pogba, Romelu Lukaku and Aron Wan-Bissaka stepped into the limelight – and failed to hold up standards.

This gradual on-field collapse culminated in the rather ugly off-field episode during the COVID pandemic, when Man Utd, alongside five other English clubs, announced they were one of the founding members of the European Super League.

At a time when the country, and the globe at large, was struggling through the pandemic, the Glazers made an egregious move to rip up the footballing world as we know it. Striving to claim a bigger slice of the commercial pie that was the juggernaut of club football, they aimed to bid adieu to the Premier League.

The move was obviously universally panned and the backlash was so severe the league was suspended three days later. For many, it was the last straw, showing once and for all that all the Glazers cared about was dollar signs, rather than preserving an institution of English football that had been around since 1878.

For me, I watched this drama unfold as a fan of one of the excluded “plebian” clubs – i.e. every club in the UK outside the top 6. I believe this was the saddest day in my 25 years of football fandom (greater than both the relegations I have endured) and I remember – like everyone – being scared that football itself was on death row, never mind just my own sorry club.

Like I said, my own personal bias and jealousy of Man Utd’s success, as well as the fact I have spent so much of my life listening to nonsense from my friends about such frivolous topics like how Paul Pogba has the talent to be one of the best players in the world (he doesn’t, and after half a decade of underperforming it’s time to give up, people), my hate for Manchester United burns strong.

Having said that, the world would be a sadder place without them – and football would be less fun. There is enjoyment in turning on my TV and exclaiming out in joy at the latest David De Gea howler. There is pure happiness in seeing Harry Maguire’s blank expression as the TV cameras unfairly zoom in on him following Brighton scoring a third goal.

That’s football. The highs and the lows, the partisanship, the tribalism and the emotions. The Glazers, alongside other owners of the big clubs, tried to take that away from both Man Utd fans and fans of everyone else – who wants to compete in a Premier League without the top 6?

And so, the Glazer Out campaign grew stronger – now to a point where it was attracting mainstream media attention. Then, last month, an absolutely disastrous start to the season threw the Glazer Out mantra all over the airwaves. Embarrassing losses to Brighton and Brentford caused more and more fans to vent.

Glazers Out was trending, Gary Neville was ranting and Whatsapp groups around the globe were deriding Man Utd fans, who were getting sympathy from absolutely nobody (see again: five premier league titles in seven years).

Elon Musk – never one to let a good opportunity to troll slip him by –  could not risk teasing Man United fans in the aftermath of their humbling by Brentford.

Also, I’m buying Manchester United ur welcome

Following Musk’s tweet, shares briefly spiked 17% before giving back gains. Still, it ended the day up 3% from its previous close. Musk did clarify that it was a joke, likening it to his tweet a few months ago where he declared he intended to buy Coca-Cola so he could put the cocaine back in the recipe. Incidentally, that is the second-most popular tweet in the history of Twitter, at a pretty impressive 4.8 million likes.

Next I’m buying Coca-Cola to put the cocaine back in

But Elon cameo aside, the share price has been ticking along rather smoothly this year. This is especially evident when plotted against the S&P 500 – a useful metric to display the relative performance of Man Utd compared to the stock market as a whole (which for the unfamiliar, has tumbled this year in the wake of an inflation crisis, rising interest rates and the Russian war).

The recent surge coincides with a great run that Manchester United have gone on, including wins over Liverpool and Arsenal. They are now one of the very few stocks that are positive overall in 2022. Looking at my portfolio, I certainly wish I was a holder (although I would never be able to look myself in the eye if I bought Man Utd stock. I may be poor, but at least I sleep at night).

In other words, the Glazers continue smiling.

But interestingly, the recent run has again served to quell the “Glazers Out” sentiment. Indeed, this is something that rival football fans often criticise Man Utd fans for. Not only that, but some of the more vocal legions of the fanbase often lament the fact that the bulk of the fanbase is unable to sustain any sort of continued protest – certainly nothing of the sort that has affected the share price (see below graph).

Just as in the past, a few big wins and the Glazer Out sentiment has died down. Or, as one (Chelsea supporting) friend put it when I asked what happens the Glazer Out protest in the wake of the emphatic victory over Liverpool, “they put away their scarves until the next time, I guess”, referencing the green and gold scarves sometimes seen at Old Trafford to protest the Glazer ownership.

I tracked the Glazer Out phrase and the results spike before dying down to pretty much nothing time and time again, following a victory, new signing or other piece of positive news related to on-field performance. For the Glazers, this chart will be music to their ears (or good TV to their eyes?) and likely the big reason why they have remained unfazed for so long about the supposed discontent within the fanbase to their ownership.

Zooming out even further to assess the trend since the start of the Glazer reign, shows the pockets of discontent come and go – but the recent one weathered in August was comfortably the biggest since the takeover went through in 2005. And now it’s back to normal, brushed under the carpet with the Glazers continuing to make bank. Or at least until Newcastle waltz into Old Trafford, Callum Wilson nets a hat-trick and sends the fans into “Glazers Out” raptures once more.

But to me, this is slightly unfair. Man Utd is a massive juggernaut of a company, as a quick glance at the below revenue figures will reveal. It’s only natural that it is hard to unify a fanbase this large – by most estimates, it is the most popular football club in the world (where did we go wrong, people?).

It’s more than a football club, really. It’s one of the most recognizable brands in the world. Every young kid turns on their TV and one of the first clubs they see will be Man Utd.

They are the vanilla ice cream of the football world, and I don’t mean that as an insult. There are some highly passionate vanilla fans out there; people who wake up in the morning and head to the shop specifically for a hit of soft, creamy vanilla to get their day going. But there are also a bunch of people who, if in a position where they are choosing an ice cream to cool themselves down while on holiday, will take vanilla. They are casual fans, contributing their cash nonetheless to the vanilla maker, yet who would not go the extra mile to fight to improve the vanilla flavour. They would just eat chocolate. Or swap from ice cream altogether, electing for a smoothie or a packet of crisps instead.

That analogy rapidly lost relevance. But what I am trying to say is that it makes sense that the protests against the Glazers are so difficult to sustain. Man United is the biggest football club in the country. Not only that, it is the biggest in the world. People will always watch them play, they will always buy their jerseys, and they will always travel to games. That is true regardless of the amount of debt on the balance sheet.

So in this context, I sympathise with the fans of Man Utd who are subjected to the derision that a sustained protest cannot be carried out.

One thing a lot of Glazer sympathisers point towards is Man Utd’s bloated transfer spend under the Glazers. It is absolutely colossal, let’s be honest. Their transfer spend is more than any other club in Europe over the last decade.

In the context of the above, the money is staggering. This is especially true given the accusations that Man City received for “buying” the league. Indeed, as a fan of a non-top 6 club with no horse in the race, these arguments between the top 6 over who spends more bemuse me.

They all essentially have limitless spending. Sure, some are bigger than others – City, Man United, PSG – but it’s hardly pennies that the smaller of the big clubs are spending. It is rare that any of these clubs cannot pursue a player they desire because they cannot afford him.

The line that Man City and Chelsea bought their league titles is strange. Man United have a limitless pool of resources when looking at their commercial pulling power – gate receipts, merchandise sales, brand value etc – that really is second to none.

But because this comes from the Manchester United brand, I suppose, it is seen as “fairer” than that it came from the pockets of a rich owner akin to Man City or Chelsea.

But again, I digress (I think I’ll have to write a deep dive on the fascinating – and frankly depressing – tale of how Saudi Arabia came to own my beloved Newcastle, and the money implications there). What matters is that the Glazers quite literally could not have pumped more money into Manchester United football club than they have.

But the issue is not around the money. It is the source of it – this is not their money, per se. And this is the part that Man United fans despise – it is the club’s money. The club generates this cash through their mammoth brand, and the Glazers distribute a portion of it into the transfer market whilst also pocketing dividends for themselves.

But on the flip side, it really is not possible to spend any more money. And the debt is not a problem compared to the size of the club, its revenue, and its balance sheet. This is not a Barcelona situation.

The real issue here that most fans have is the on-field performance (or lack of it, I should say), regardless of the chatter around debt. If Man United get back to their winning ways like the days of Alex Ferguson, the Glazer Out chat would die down even more. In fact, it kind of already has, following a few wins on the bounce.

But I still have more sympathy for Man United fans than most. The Glazers owning this football club – nay, this institution – is wrong. The model is flawed. The club is too important to its fans, the public and the country at large. While certain ownership situations are undoubtedly worse – ask any fans of Bury, Derby, Leeds, (even Newcastle!) and many other clubs – the way the Glazers are funnelling this club for money is grating to see.

By employing non-football executives and other businessmen, they have made some terrible decisions and their signings have been historically bad – but the share price has ticked along, and the dividends have flowed.

It circles back around to their ownership of the Tampa bay Buccaneers. American sports are vitally different in that they are run as franchises, meaning there is no relegation or promotion. Revenue is more secure and hence the owners enjoy stability and guaranteed revenue regardless of on-field success.

This was the driving force behind the European Super League; an initiative which sought to bring the European football model more in line with the American franchise model.

But there are cultural and historical differences across the Atlantic. Football – I’m talking soccer here, just for clarity – has no place for a franchise-led model. And the Glazers are trying to run this club as close to a franchise as they possibly can.

This all comes down to one thing: the Glazers are running Manchester United like a business. But Manchester United should not be run like a business, it should be run like a football club.

It is a sad situation and the Glazers are a very bad thing for football in the UK and Europe. Stories like the European Super League are a direct consequence of the strangling effect that money is having on football.

Regardless of your thoughts on Man Utd as a club – and again, I hate them more than most; I can’t even bring myself to put a Man Utd player in my fantasy team at the moment without feeling nauseous – this should be a matter of concern for all football fans.

In a lot of ways, the Glazers sum up what is wrong with modern football. There is nothing wrong with how they are running their business; in fact, they are running it well.

The problem is that they are running it like a business in the first place.