Manchester United Rumours Archive November 16 2010

16 Nov 2010 23:40:29
Manchester United Rumours
Ed i spoke to a friend of mine, hes not famous and neither is the person he heard this from but i was told that Manchester United took a long look at Danny Wilson before Liverpool signed him, the reason i heard that they never followed through with the deal was because he was too short.

I have just checked on Wiki and it says he is 6ft 1" tall, is that too short for the Premiership? {ed's note - considering the best header of the ball is Tim Cahill and he is well under 6ft tall, I don't see how his height is a problem.}

16 Nov 2010 20:06:11
Manchester United Rumours
January transfer window activity-
1.rooney - real madrid - 70mill

*ankle injury is absolutely nonsense .he is completely alright.fergie keep him out until january and direct send him to real madrid.no other transfer activity.all others are staying. we are in critical situation as increased debt interest.we need to pay back 220mill.

already reach the agreement. 220mill pay back debt include rooney selling money of 70mill. balance money are gain from increased ticket price and merchandise Manchester United product around world and some glazers own money. .Glazer is lying that he never takes clubs money.

-kimo-

16 Nov 2010 19:38:41
Manchester United Rumours
"I think we'll find the loan is secured against their shareholding in RFJV. The market is easing so it would be easier for them to get a loan on this basis. It makes financial sense for the Glazers to do this, and does improve United's situation in that the PIK debt stops being quite so poisonous. Unless the £220m has come from a completely different source, this doesn't really change things a great deal for United overall. Remember also that a Glazer company owns £40m of the PIK notes now - so presumably they'll be taking a lump sum themselves as part of this pay-off."

@Not exactly Darks, the PIKs stand at 243m and the Glazers own 36m of them, so the Glazers will only be walking away with around 14m for themselves.

I think you are being a tad melodramatic Darks, getting rid of the PIKs can only be good even if we are lumbered with the new low yield loan, because according to you this time last week we were going to have to fork out to pay the 16.25% PIKs anyway.

A typical case of turning a better situation worse.

Sydney!

16 Nov 2010 18:46:46
Manchester United Rumours
No transfers in the january transfer window. Only Cleverley will come back from his loan to give United's weak midfield better cover.

In the summer this guys are on the rader:

Henderson: pretty much done deal
Bale/Sanchez/(even Kakuta is a possibility because of his contract situation)
Lindegaard/Buffon: if the latter proves his fitness he will definitly be signed

Sold/retired:

Diouf: No place for him with 3 more talentetd strikers in front of him
Owen
Van der Sar
Neville
Giggs

Welbeck WON'T be included in the Henderson deal. Big hopes for him in Manchester. Also think he is a lot more talented and complete than Macheda.

16 Nov 2010 17:32:00
Manchester United Rumours
Why is debt such a big issue at Manchester United?

The Glazer family borrowed heavily to buy the club and many fans think the burden has restricted the club's ability to buy players.

Back in autumn 2004 David Gill, the chief executive said: "We've seen many examples of debt in football over the years and the difficulties it causes. We know what that means and we think that is inappropriate for this business."

But the Glazers came back with another bid using so called payment in kind notes (PIK). Because PIK notes have a right to convert into shares - they could be classified as equity, not debt.

How much is the debt burden?
Well last month the club reported a loss of £83.6m for the year ending 30 June, mainly due to interest payments on its debt.

It has been estimated that between 2005-9 Red Football Joint Venture Limited has spent at least £260m servicing its debt.

Is that from these PIK loans and what are they?
Controversial loans which pay high interest and roll up the payments until the end of their life, so no, last year's interest bill did not include them.

So what interest charges were being accrued on the PIK loan?
Well the PIK loan was worth £220m and was accruing interest at an eye watering 16.25pc a year.

So what could the PIK notes have cost United?
By the end of its life the cost of the loan could have been nearly £600m.

Who held the loan?
Originally it was three New York hedge funds Perry Capital, Och Ziff and Citadel – which extended the money. The notes made lots of money for the three hedge funds which sold the debt on to about 20 so-called vulture funds, institutions who like high risk high reward investments.

Is it United or the Glazers who have paid off the PIK early?
Well it is the Glazers through their holding company Red Football Joint Venture rather than United who are paying off the PIK loan. Joel Glazer, United's co-chairman has signed a 'voluntary free payment notice' to repay 100pc of the outstanding loan on November22.

What from their own money?
Seems to be. And under the terms of a bond issue in January they could have used £70m from the club to pay down part of the debt.

What's a bond?
A bond is a loan which promises to pay a fixed amount of interest over a period of time at the end of which the original sum must be repaid.

So the PIK loan pay off is good news for United then?
Maybe. Some fans are worried about where the cash has come from though the Glazers say they have not taken a dividend out of United.

So where has the cash come from?
The club and the Glazers aren't saying but could be they refinanced the loan, or sold a stake in the club or sold other assets to raise the cash.

So does that mean United no longer has any debt?
No, there is still the small matter of the £526m bond issued in January.

Who backed that?
A group of about 50 insurance companies and pension funds lent the money at an annual fixed rate of 9pc.

Was that better than United's existing debt?
The interest bill was similar but crucially the bond doesn't mature until 2017 so United has plenty of time to repay it unlike its previous debt.

So what does the bond cost?
Well the latest accounts show United paid £22.7m in interest, and the terms of the bond are for interest to be paid twice a year so about £45m.

So United owes a lot?
Yes it does although in the accounts published today the club also had cash of £151.7m sitting in the bank at the end of September.

How do we know this?
Under the terms of the bond issue United is obliged to publish regular financial figures to keep the bondholders informed.

This item was written by Helia Ebrahimi for the Daily Telegraph.

Sharkey.

16 Nov 2010 16:29:12
Manchester United Rumours
16 Nov 2010 15:12:42
Manchester United Rumours
Ferguson and Hodgeson to go toe to toe in a battle to sign young Rennes midfielder Yann M'Vila. Fee approx £15M.
- - -

Hodgson won't be able to attend that battle - he's in the sack race with Avram Grant and currently leading the way.

M'Vila is actually a player on Frenchman Damien Comolli's (new head of transfers at LFC) transfer shortlist. He's admired him since his call-up for France U-21 and was going to make a move in the summer while at St Ettiene, but was obviously snatched by LFC before he could do so.

Along with that, my continental source said that SAF began sending scouts to Rennes games round about August - he's not sure if he was watching M'Vila, though but he's almost certain that the scouts were impressed by M'Vila's performances.

16 Nov 2010 15:01:29
"Now the Glazers are paying off the debt, lets stop this silly hate Campaign. Lets show our support for the Glazers and make us the best in the world again!"

Let's wait and see how they're paying the PIK debt off.

Everybody should remember that, legally, Red Football Joint Venture is NOT the football club. That is Red Football. RFJV is a company solely owned by the Glazers that owns all the shares of Red Football. The PIK debt that belonged to RFJV was secured against those shares. The Glazers have stated that no cash dividend has been taken from Red Football to pay off the PIKs but have NOT stated where the money has come from to do so. My guess would be that they have taken out a loan, still secured against their shareholding in Red Football.

Remember - if they had nothing to hide, they would tell us what was going on and be honest and open about it. An honest, open approach would also garner respect from people like me and I might get off their backs. Case in point - and I hate to say it - but look at the open, frank and honest assessments coming from John Henry and NESV. It's not all good news, but that means you can trust them. Second example - PIKs usually don't carry an early payback clause. The Glazers' did. Why didn't they reveal that fact? It would have actually had a positive impact on their bond issue. The fact that they hide so much means they are not to be trusted.

Our £163m cash, by the way, now stands at £151m (as of the end of September) and will continue to reduce through the season, probably falling to around the £60m mark by the end of the season. That's a natural fluctuation for a seasonal business. United (and other clubs) publish results at the end of June each year because that's when cash sheets look healthiest.

The Glazers don't deserve our support until they show US respect by telling US what their long-term plans are and how they intend to handle the club's debt.

My judgment remains withheld until we see this year's figures in October 2011. My view of what has happened yesterday and today is that it is - at very best - neutral news (i.e. the Glazers have paid off debt that was their own in the first place without robbing it from United but will continue to bleed us for £90m - £100m a year including interest on loans) or - at worst - a cynical publicity stunt that gives them positive kudos whilst even more irrevocably linking their own debt to the club.

Regards Carrington: their right in the prospectus was to transfer ownership to RFJV. There was no stricture placed against RFJV to say they could not then sell Carrington onwards. Even I can't see them taking that final step, however.

DarkLard08

16 Nov 2010 14:58:14
Manchester United Rumours
Anyone heard any rumors on united looking at buffon

16 Nov 2010 13:08:25
Manchester United Rumours
"
@Actually our net asset worth is currently £777m, therefore if you minus the £521.7m current debt we can afford to take on a further £256m worth of debt therefore its very possible we will be lumbered with the debt.

Sydney!"

Wrong there Sydney!
The net assets you are talking about include player assets. We cannot borrow against those. We can only borrow against fixed assets like carrington, OT etc. We cannot borrow more since, all and i repeat all of our assets are tied up in the bond. The bond does not allow us to borrow against united's assets even if they are worth more than the bond's value. We can get external unsecured financing at high interest rates like PIKs but there is no point for glazers to refinance that way again since it will not reduce the debt whatsoever. I believe there are only two possibilities here. One is that they have sold a minority stake in the club and some other assets and the second is that they have diverted funds from their other companies into united via loans later being converted to equity something like abrahamovic did at chelsea. I think it is the second one and strongly doubt they will sell stakes from united or any other assets. {ed's note - I thought that the bond allowed for the Carrington to be transferred to the holding company and then be leased to the club itself? Would it not then be possible for them to use that as an asset to loan money against? I am asking a question not stating a fact by the way.}

16 Nov 2010 12:56:51
Manchester United Rumours
Ed how have you and sydney managed to turn the PIK payment into negative scaremongering? It can only be good news if the PIKS are paid off and was the most obvious place to start stripping the debt down. Im sure details of it will be released in due course but ultimately whether we want to believe it or not the PIKs would have ended up a burden on the club and the fact the Glaziers are due to pay them off makes their financial standing stronger thus the club's. They are the owners after all. I know theres a long way to go but this is a bloody good start no?

Stuey

{Editor's Note: I have not turned it in to anything - all I warned against was the claim that the money for the repayment of the PIKs would be borrowed against the club.}

@Ed i think you mean COULD, not WOULD, personally i believe the Glazers have sold some shares in United to pay off these PIKs.

Stu, i am over the moon about this news, its a good day to be a United fan.

Sydney!

16 Nov 2010 12:42:24
Manchester United Rumours
Sydney! {ed's note - that is if it is United they have sold off a percentage of.}

@What do you mean Ed? I doubt any investor will want a percentage of the malls or the Bucs! I think the Bucs are only worth around 300m anyway? It must be shares in the club Ed? What do you think? {ed's note - why must it? It is far more likely to be a loan at a lower rate than a sale in my opinion. There is less worry over loaning money in the US right now, it is a simple matter to just take out a loan at a lower rate of interest to clear off one at a much higher rate.}

16 Nov 2010 12:27:45
Manchester United Rumours
Sydney!

{Editor's Note: There is nothing whatsoever to substantiate your suggestion that "its very possible we will be lumbered with the debt". I think it may be best to wait and see how this pans out before scaremongering the fans.}

@Ed i am a United fan through and through, i just wanted to clear up the fact that it COULD be added to our current debt, personally i think it will not be, did you watch SSN just now ed? An expert has just given his verdict on it. He believes its one of three ways:

1) The owners have sold some of their other assets in America, he rates this as unlikely.

2) The owners will replace the 220m PIKs with 300m at a lower yield. He rates that as unlikely too.

3) The owners have sold off some shares of the company to another investor and they are using that money to pay off the PIKs. He believes this is what is going on, he believes by 2017 when the bond has to be paid the Glazers will own a majority of the company but United would be debt free. For example 60% owned by Glazers, 40% owned by investors and the club will be debt free.

This means the Glazers have a 60% share in a 1.4bn club and it never cost them a PENNY! Is that clear enough Ed?

Sydney! {ed's note - that is if it is United they have sold off a percentage of.}

16 Nov 2010 12:17:02
Manchester United Rumours
Arshavin and Bendtner are not sh!t as someone kindly put it?! Bendtner is the type of quality striker that would benefit from regular starts- just like Huntelaar is in Germany- watch him bang them in if he leaves Arsenal! As for Arshavin, his work rate i admit is sometimes suspect, but his quality, passing, vision and scoring is fantastic(4 goals against Liverpool remember? ) and his assists have to be taken into account as well! !

Huntelaar is sh!t too.

16 Nov 2010 12:01:29
Manchester United Rumours
No ed. You are completely wrong here. No new debt can be added to the club since all the assets are already tied in the bond. It may be the holding company's debt if it were debt after all (i doubt it is debt again) and will have nothing to do with MUFC. {ed's note - cheers for clearing that up, I wasn't sure, the editor who has much more understanding on these financial issues wasn't around for me to ask. So basically this is an irrelevance really, the PIKs are not the club's debt so it makes no difference to the club if they are paid off or not.}

@Actually our net asset worth is currently £777m, therefore if you minus the £521.7m current debt we can afford to take on a further £256m worth of debt therefore its very possible we will be lumbered with the debt.

Sydney!

{Editor's Note: There is nothing whatsoever to substantiate your suggestion that "its very possible we will be lumbered with the debt". I think it may be best to wait and see how this pans out before scaremongering the fans.}

16 Nov 2010 11:48:16
Manchester United Rumours
16 Nov 2010 11:26:48
Manchester United Rumours
"{ed's note - I don't understand how you can say it doesn't matter, the PIKs are not a debt laid upon the club, but the loans they take out to pay them off could well be, is that not correct? I think you have to be the world's most optimistic fan!}"

No ed. You are completely wrong here. No new debt can be added to the club since all the assets are already tied in the bond. It may be the holding company's debt if it were debt after all (i doubt it is debt again) and will have nothing to do with MUFC. {ed's note - cheers for clearing that up, I wasn't sure, the editor who has much more understanding on these financial issues wasn't around for me to ask. So basically this is an irrelevance really, the PIKs are not the club's debt so it makes no difference to the club if they are paid off or not.}

TRUE BUT THEY ARE STILL THE RESPONSIBILITY OF THE OWNERS, AT THE END OF THE DAY THIER FINANCES AFFECT OURS TO AN EXTENT SO IF THEY CAN PAY THESE OFF ITS 1 DOWN 1 TO GO. CAN YOU IMAGINE THE FINANCIAL FORCE WE WILL BE WHEN THESE BURDENS ARE LIFTED! !

16 Nov 2010 11:26:48
Manchester United Rumours
"{ed's note - I don't understand how you can say it doesn't matter, the PIKs are not a debt laid upon the club, but the loans they take out to pay them off could well be, is that not correct? I think you have to be the world's most optimistic fan!}"

No ed. You are completely wrong here. No new debt can be added to the club since all the assets are already tied in the bond. It may be the holding company's debt if it were debt after all (i doubt it is debt again) and will have nothing to do with MUFC. {ed's note - cheers for clearing that up, I wasn't sure, the editor who has much more understanding on these financial issues wasn't around for me to ask. So basically this is an irrelevance really, the PIKs are not the club's debt so it makes no difference to the club if they are paid off or not.}

16 Nov 2010 11:26:44
Manchester United Rumours
Sydney! {ed's note - I don't understand how you can say it doesn't matter, the PIKs are not a debt laid upon the club, but the loans they take out to pay them off could well be, is that not correct? I think you have to be the world's most optimistic fan!}

@Well whats changed? According to the majority of United fans and all of the anti United brigade we were going to have to pay the PIKs off anyway? According to most United fans the PIKs were secured against our club anyway so the only difference is we are still 700m in debt but the yield is much lower? That's the worst scenario ed.

If we are lucky, they may have used some of their hidden funds, after all they are worth 2.2bn, surely they can find the 0.2bn?

Sydney! {ed's note - you may well be right mate, nothing wrong with being optimistic either, I am just amazed by your constant capacity to look on the bright side of it all. I certainly hope you are right, though, if the Glazers were telling the truth, and that is the point I was actually intending to make, the PIKs were never United's debt anyway, so this would make no difference whatsoever.}

16 Nov 2010 10:57:43
Now that the glazers are allegedly paying off the PIKs out of their own pocket, surely they have to either by US or UK law or common business practices have to disclose where the money is coming from? If not , and it is true then hopefully this is good news for the club.Maybe this is one of the things that convinced Rooney to stay? maybe he knew what was in the offing or they asked him to be patient and rather than let our one true world class player leave decided to bite the bullet and pull this out of the hat? hopefully also we can at least look at signing one or two quality players now to replace a few average ones at our club? would love to see Suarez , Dzeko, Adam Johnson, Modric and even Arshavin and Bendtner play for us!

16 Nov 2010 08:44:16
Chelsea are not lookin in good shape. first a loss to Sunderland n
Lampard not fit for a few weeks, Essein out for 2 games n Terry sidelined indefinitely.

Time for Man Utd to leapfrog them in the standings. Its the best time for Man Utd to do it n they should do it nw.

Henderson can develop well with Scholes at Man Utd next season.
Sanchez is a certainity with Affelay gone to Barcelona in an almost done deal. .

We may take Defour or Ilkay Gundogan after selling Anderson(i m sick of this guy. he hasnt converted his potential into results yet.) both of them are good n have the potential + low transfer fees of around 12 millions for Defour or 9 millions for Gundogan.

nobody here talk about a CB. Guyzz Man Utd need 1 more Cb because Rio cannot paly whole season without an injury. .

Man Utd fans ur pick from the Available CBs.
1. M.Demechilles 2. P. Mertsacker 3. Gary Cahill.
Ed ur say on the above points.

{Editor's Note: Defour would be a great buy; Sanchez will be a bidding war; any of the three CBs would be a good addition.}

16 Nov 2010 08:22:34
Manchester United Rumours
It is being widely reported across financial newspapers and websites that the glazer family has decided to pay off the PIKs on november the 22nd . Not surprising but what may come as a bit of a shock is that it isn't being paid off from the clubs' finances but from the glazers' pockets apparently. Maybe david gill was speaking the truth after all. Now there may be a chance of them refinancing through some other ways but it certainly will not be leveraged on the club since all the clubs' assets are tied in the bond scheme. There even are official quotes from david gill reiterating what he said months ago and the spokespersons for the hedge funds conforming this who are dissapointed at losing the huge interest being compounded on to the principal amount at a rate of 16.25%. Also the fact that it has been published in a reputed financial website rather than a tabloid like the$un or goal.com makes me believe that there is truth in the story.

I wonder what the "glazers will take huge dividends out to pay off the PIKs and run united into the ground" brigade has to say about this. No comments from MUST apparently who are in shock at glazers paying off debt from their own pockets rather than united's and are looking for ways to make this promising news look worse.

At least this is a good start by the glazers in repayment of the debt.

Any thoughts on this shocking development ed?

REDFAITH

{Editor's Note: My only thought about this when I heard yesterday was "where is the money coming from?"}

16 Nov 2010 08:21:28
Manchester United Rumours
Glazers are to pay of the pik's next week is this an early xmas present?

16 Nov 2010 06:08:23
Manchester United Rumours
I personally think Henderson would be a quality signing but can't see welbeck in px maybe Owen because if the 6english 5foreign or what ever it is comes in we need as many young British hopefuls as possible maybe macheda could go and aparently utd are keeping tabs on jay bothroyd Scott sinclair Andy king Conor wickhan mcgregor sanchez hamsik lavezzi neuer podolski muller Marin hazard isla Honda defour wijnaldum feghouli augusto vilalva mchedlidze these are all players that have been scouted by united within the last 5months more than once and been spoken to by the club