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Why Has Manchester United Resigned Itself To Being Outspent?

Posted on by tyduffy

200px Alex Ferguson by FvS Why Has Manchester United Resigned Itself To Being Outspent?Sir Alex Ferguson has a practical take on morality.  Anything benefitting Manchester United is right.  Anything hindering Manchester United is wrong.  With Manchester City and Real Madrid suddenly able to outbid Manchester United for players.  It should surprise no one that the grizzled Scot spoke out for the little man.

“I said a year ago, when they [the Abu Dhabi United Group] took over at City, that this was possible,” Ferguson said. “Some of the values across the world now are amazing; the numbers that get tossed about. The values of players have shot sky high. I don’t think any of the [big] transfers this summer are realistic but for some reason it has caught fire this summer. It’s an unusual summer and it’s very difficult to get value because of that.”

“We went in for Benzema but, as far as we were concerned, the price tag was beyond his value. If other clubs want to go to that level, that’s entirely their business. We had a value that we thought was fair and we didn’t want to go above that position. Maybe Lyon thought we under-valued him and that’s fine, it’s their decision. They got €42m for him and they will be happy with that because they have done well. All this tells you about us is that we are sensible.”

Ferguson discusses “sensible” spending, but under his tenure at Manchester United, that has always meant spending superior resources to crush the opposition.  Let’s look at this decade.

United signed Ruud Van Nistelrooy for a club record £19m in 2001.  Later that year, he smashed that record by bringing in Juan Sebastian Veron for £28.1m.

Ferguson broke the transfer record again in 2002, spending £29m for Rio Ferdinand.

In 2004, the club spent £25.6m for Wayne Rooney.

United signed Michael Carrick from Tottenham for £18.6m in 2006, and spent £17m on Owen Hargreaves the next summer.

In 2008, Ferguson broke the club’s transfer record again spending £30.75m on striker Dimitar Berbatov.

When Ferguson wants a player, Manchester United overspends with superior financial resources to get him.  It is hypocritical to criticize other clubs, which finally have more financial resources than United, for doing so.

It is interesting that Manchester United are resigned to being outbid for players.  They have had two extended Champions League runs the past two seasons and received an £80m windfall from the Ronaldo transfer.  If all was well, there should be plenty of cash available.

Is this truly Ferguson, who shows no track record of doing so, finally being “sensible,” or is the tremendous debt foisted on the club by Malcolm Glazer starting to affect the club’s finances?

This entry was posted in General, Leagues: EPL and tagged . Bookmark the permalink.

58 Responses to Why Has Manchester United Resigned Itself To Being Outspent?

  1. Roy says:

    Fergie (and the Glaser’s) are being “tight”. That’s all there is to it. The market value for a player is “whatever the market bids for it” (just look at Real Estate, as an example). If someone bids $30 million, then they are worth it. Full stop. Fergie is just looking for excuses “not to spend”. It makes no sense that with a windfall of $130 million then say Benzema is not worth $35 or Ibramovic is not worth $40 million. If the player fits your plans for the future, they buy him, before someone else does. It’s all bull****. If United start losing games this season, especially early games, then the ManUtd die-hards are gonna be calling for his head. $100 million the bank will not make United fans happy. They want to see the team win! and nothing more. Or, is Fergie past it. Does he have old out-dated views about “his value” of a player (is this out of sync with the marketplace?).

    • Jonno says:

      Are you kidding me? You must be a plastic fan! No real United fan is going to call for SAF’s head if we lose a couple of early games, the guy is the most successful manager in the world and a United legend.

      Fergie has won 3 titles in a row and reached the Champions League final 2 years in a row, he is not past it.

      We did bid for Benzema but Real Madrid bid more and the player wanted to join them, there was nothing we could do about it. Inter were reportedly asking for £65 for Ibrahimovic and Bayern a similar fee for Ribery, the players aren’t worth it. I would rather us save the money until such a time when the market is at a more reasonable level and we can buy replacements for Scholes and Giggs if needed.

      • equals42 says:

        I’m afraid you might be waiting a while for player values are at “a more reasonable level”. We all thought prices were unreasonable when Chelski began buying players or during the first run at Galacticos.
        I’m not quite sure I understand the business model these new owners are using to justify pouring this much money into players but it seems to be a fact of life now. Just hope your team collects one of these moneyed owners and their fortunes aren’t tied to proceeds lost in a coup.

        I’m still deciding whom I prefer for the Gunners: a Russian billionaire or Kroenke who has his hats and limited money spread into too many sports.

  2. steven says:

    Yes, I know your comment is reasonable, but not complete. Although we spend money for player, you should notice also, it is only for one player, for each transfer window, not like Madrid, or other club of Manchester, which I know all of you know, who I meant. They are spend and spend money for sky high transfer. Loan money to break their own world transfer. They are thinking money can buy success.

  3. Roy says:

    It is also a load of bull that United are in “debt” (citing the Glaser’s money to buy the club). As any businessman knows you do not expect to get your money back for an “asset purchase” within a few short years. All United have to do is pay the Glaser’s “interest only” (and interest rates are at an all-time low at present). If and when the Glaser’s sell United, they will then reap the huge benefits/profits (assuming the asking price goes up, as it always does). Ticket sales, attendances etc etc at United have not fallen… therefore they have the same “income” as before… and they now have an additional $100 million in the bank. They shouldn’t be so tight-fisted and buy some top players…. for a top club… with top supporters.

    • equals42 says:

      Roy,
      Interest rates are low generally only for banks drawing off Central Banks. For most companies issuing bonds, rates are very high due to the tight market. US Airways was reported in the NY Times as paying 17% on newly issued debt mostly because all their collateral is already mortgaged. Could the same be said for ManU? It will depend simply on the perceived market value of the team.

      There is more to the Glaser debt issues than is immediately apparent. No doubt the 80 million for CR helped. They’re not likely to let on exactly what the financial picture is so continue to speculate.

  4. I was rather shocked when I read that United was done with summer spending – less shocked (looking back) that it happened after Benzema came out and chose Madrid over United. We’ve all known about the club’s debt – but surely SAF wouldn’t let a silly little thing like money get in the way of his spending? I don’t see the boss getting more sensible as the years go by. I’m still not sure what I make of this.

    • Roy says:

      As I said before, there is “no debt” at ManUtd (Glaser’s). If you bought a house as an asset for say $500,000…. you would not put the rent at $100,000 a year to get your money back in 5 years. You would be crazy. Buying an asset (like ManUtd or a house) will realise you a profit after you sell… all you need to get back is the “interest only” to service the loan (which United can easily afford to pay).

      • dimitar says:

        What you people do not understand is that the interests of the Glazers are aligned with the interests of the fans. Both want to increase the “value” of the club – the best way to do this is to keep it the best club in the world. Say United is worth (these are all invented numbers just to make a point) 1.0 Bil. – It has assets of 1.5 Bil and debt of 0.5 Bil. Then United sells assets worth 0.1 Bil. The profits can go either to (i) reduce the debt or (ii) buy new assets – United still will be worth 1.0 Bil. and the Glasers will still not have made or lost any money. The goal of the Glazers is in say 10 years the club to be worth 3.0 Bil. so that they can make 2.0 bil. profit when they sell it. If United has not won any titles in years, but also has no debt, it will NOT be worth 3.0 Bil. – so the Glasers win. If United has 1.0 Bil. in debt, but has won 10 EPLs and 10 CL cups in a row, United will be worth more than 3.0 Bil. and the Glzers win. So the Glazers and the fans want exactly one and the same thing. The only question is whether you have to immediately spend the money you have and significantly overpay for assets (think paying 100 mil. for Nani this year) or wait a year and then use the same amount of money to buy more valuable assets (think Owen for free). At the end both the Glazers and the fans want one and the same thing – United to be the BEST club in the world, and therefore the most expensive/valued club in the world. All club have owners – some are american businessmen, some – arab oil sheiks, and some Russian mafia billionaires.

  5. Roy says:

    $130 million will buy a few darn good “top players” (not just one). To quote Fergie… “Coming 2nd is not an option”… but he will be coming 2nd (or worse) in the EPL and the Champions League if he doesn’t stop being so tight-fisted. Time will tell… if they come 2nd, or 3rd, or 4th in the table this year (as I expect) Fergie will come out with some bull about it being a “re-building process” (which is just another excuse).

  6. Roy says:

    As I said before, there is “no debt” at ManUtd (Glaser’s). If you bought a house as an asset for say $500,000…. you would not put the rent at $100,000 a year to get your money back in 5 years. You would be crazy. Buying an asset (like ManUtd or a house) will realise you a profit after you sell… all you need to get back is the “interest only” to service the loan (which United can easily afford to pay).

    • equals42 says:

      You are supposing the loans are structured so that the debt holders never want their principle back. That’s not how lending generally works. I can’t find published details on the Glaser’s loans but I guarantee it is not interest only forever.

      For your sake Roy I hope someone gave them an interest only 500 million pound loan at 5%. My math from the AP article below shows 183 million USD in loan payments ($118 million profit to a $65 million loss). That’s not interest only. Glaser’s trying to payoff debt holders to gain full ownership. Maybe not 5 years but soon.

      Please feel free to correct my numbers as I’m in a hurry.

      ********************
      From AP:
      MANCHESTER, England (AP) – Manchester United’s parent company posted a pretax loss of $65.9 million last season despite an improved operating profit by the club after winning both the Premier and Champions League.

      Figures released on Thursday by Companies House showed that United’s operating profit went up by $7.35 million to $118.3 million in the fiscal year ending June 2008. The results revealed increased TV revenues and bonuses from title successes, confirming that the club maintains a strong marketing brand around the world.

      But the continued debt repayments by Buccaneers owner Malcolm Glazer, who took out a loan to buy the club in 2005, meant the balance sheet showed another loss.

      The club is also looking for a new shirt sponsor to replace American International Group (AIG), which collapsed last year and was bailed by the U.S. government.
      ************
      * Under the deal, Glazer rolled his 28.1 percent stake in United, worth about 222 million pounds, into the new club and topped that up with his own cash so that his overall personal contribution to the takeover is about 272 million pounds.

      * Banks and funds, led by U.S. investment bank J.P. Morgan Chase & Co, provided a 265 million pound loan to Glazer which was immediately transferred to Manchester United’s own balance sheet and secured against United’s assets.

      * The banks also provided an additional 275 million pound loan in return for which they were given preferred securities, like preference shares, in United. Glazer has the right to buy back those securities from the banks over time. [Preferred shares are usually paid quarterly interest as well.]

      * The three figures add up to 812 million pounds, which is more than the 790 million pounds Glazer needed to buy the club’s shares. The difference of 22 million pounds went toward paying Glazer’s advisers’ fees as well as funding the previously announced expansion of United’s football ground at Old Trafford.

  7. Roy says:

    If you pay 5% “interest only” on a $1 billion loan… this will only cost you half a million dollars a year. This is peanuts to ManUtd. Real Madrid intend to sell more shirts (Kaka and Ronaldo and co) that would realise at least $5 to $15 million a year. Good business sense eh? The Glaser’s money/debt does not come into the equation at all. It is just an excuse for “not spending”.

    • hank says:

      Roy, 5% of $1 billion is $50 million (not $500,000). Also, that $1 billion doesn’t magically go away – banks tend to want their money back. The estimate I found is £60million ($98million), per year, to service the debt from Glazer’s purchase. That is a significant pile of coin, even for united, to come up with each year.

      How that relates to Fergie’s decision not to spend big in the transfer market, I don’t know. I tend to agree that since Madrid and City spending big, transfer fee’s may be inflated and players may not be worth their asking price (as judged by the extra revenue that their improvement to the team may bring in).

  8. Roy says:

    If United start “losing games” more frequently…. and attendances drop…. and general sales drop… then they will have a mini problem for sure. However, in the past, attendances at United tend to be the same (or quite high) regardless of how the team is faring in the League (but that can easily change this year if they don’t spend a fair chunk of the money from the Ronald sale and the fans start to feel short-changed).

  9. Roy says:

    Money cannot buy success in football… we all know that… but it can come very very close (ie: Chelsea). If Fergie honestly thinks his present squad of players is good enough to win the EPL again, and also the Champions League… then so be it. But if he FAILS… and they come say 3rd or 4th in the League and get knocked out of the Champions League in the Quarters (or early stages) then the fans will ask…. WHY DIDN’T YOU BUY SOME TOP PLAYERS WITH ALL THE MONEY IN THE BANK???? Time will tell. I wish I could fast-forward to the end of the coming season, but I can’t. We will have to wait and see.

  10. Roy says:

    Manchester City’s big spending is dangerous. They do not have the “income base” that United has, or the draw power… therefore City’s “big spending” is at the ego only behest of the rich owner (nothing more). It will take City years and years to realise any profit from it, if at all. United are a different story completely. When the Glaser’s purchased United they called them a “Cash Cow”. Nothing has changed since. I do believe, however, that United should be more adventurous with their “player promotions” for extra income (like Real Madrid). They could learn a lot from the Madrid promotional attitude. If I paid 80 million quid for Ronaldo I would have him making toothpaste commercials, Benzema cream for piles (or whatever) to get some money back…. and to pay for all the big wages. United seem content to just sell shirts and the like. A bit old fashioned me thinks. The corporate world is a big hungry animal… just look at how the likes of Paris Hilton has promoted herself (and she has no talent or skill whatsoever).

  11. coachie says:

    United are in fine shape, as is, for a top three finish in the league last year and a run past the group stages on the continent. Whatever the motive behind it, I am behind the no-signings-over-age-26 mindset.
    As such, I’m surprised they let Fraizer Campbell go.

  12. Takash says:

    You miss the point. Buying someone for £60m and paying £200k wages disrupts everything at the club. Everyone’s salary has to rise or there will be mutiny. The wage structure is destroyed. That’s why United have never bought those marquee players. They’ve paid large fees but the salaries fit into the structure. The wages are far more important than the fee.

    The current market is inflated by Real and to a lesser extent City and also because selling clubs know that United and Milan have cash from their sales. As we get nearer to the window closing prices will come down and they’ll be lower in January. Ferguson is safe looking at his squad in pre-season and the first few games and if he feels he needs a little extra he can move as the prices drop or in January. But there really is no weakness in the squad and the dressingroom is happy and together. I predict that by January you won’t be able to say that about Real’s or City’s dressing rooms.

  13. Roy says:

    I don’t fully agree with it (over 26 that is). Every team needs good experienced players in it, and the younger players learn a lot from them… and if the slightly older players are very very good “top players”, world class, then they will learn better and faster. The same opinion is also the same with the England team. They have a good balance of older players, sometime most of the team is older (in the important games) and only the youngsters get a run with the easy games.

  14. doc says:

    Takash is on the right track. Ferguson is just playing his usual mindgames by telling the world he’s through for the window. Watch for a deadline deal or two from United at much lower prices than he would pay for the same players now. I’m an Arsenal fan and can’t stand Ferguson, but he’s a very shrewd man.

  15. Dave says:

    To be honest from your article you don’t seem to have grasped what Ferguson was talking about at all. Manchester United have spent large amounts in the context of the Premier League but rarley have they been the top spenders in Europe.

    When you look at the history of Perez at Real you’ll see that in 2001 he spent 78 million euro’s on Zidane. In the following 7 years no transfer has even got close to that figure until Perez came back and spent over 90 million euro’s on Ronaldo.

    After this summer it is highly unlikley that Real will be chasing more than one huge signing in the next transfer window if that. As such, unless City are able to get into the champions league next summer it is likley the market will have calmed down and while prices will still be exhorbitant the most expensive will be around £35 million as apposed to the £50 million plus being quoted for the likes of Aguero and Ribery.

    As such with United hardly short on talent despite the loss of Ronaldo and Tevez it is not worth wasting the £80 million United have gained. I suspect that if Real complete their dealings soon then by mid-to-late August the prices of other players will have dropped and United will reap the rewards.

  16. J.V.R. says:

    Perhaps because they are drowning in debt?

  17. Roy says:

    (per Dave above)… and by that time the Transfer Window will have CLOSED. So, he will save X-amount of money but lose the EPL race. That doesn’t sound too brilliant to me. It’s OK to be shrewd (as he is) but at what cost. The United fans expect success. If they come 2nd or 3rd or 4th then is it worth it, to maybe save $15 million. Prestige and success are very very important. As Fergie says… “Coming 2nd is not an option” (unless of course you are just being “tight”). United’s offer for Benzema was only around $30 million… hardly breaking the bank with that one!!!! He apid that for Berbatov who has done nothing really.

  18. Roy says:

    All we are talking about here is the money from “Ronaldo”. What about “extra money” that other teams have to spend. If Fergie spends 80 million and buys say Benzema (35 million) and Ibrahimovic (40 million) then he still has 10 million left over and no spending this year from his normal budget. I think most teams would swap Ronaldo for Benzema and Ibrahimovic (sounds like a good swap to me) and get 10 million extra for it at the same time.

  19. dageeza says:

    rags in the swamp are worried… fergies last season…
    manchester blue moon risin…
    CTID…

  20. Roy says:

    We are only worried about not coming 1st (as is normal). Suppose with “your team” coming 5th is an achievement – not with United???? (ha ha).

  21. Roy says:

    Just read the new headline…. “English football champions Manchester United are to open their first cafe in the western Indian city of Mumbai (Bombay) later this year.” Does this mean they may be selling Giggs & Curry, Rooney Burgers, and Fergie Fries????

  22. Peter says:

    You don’t need bucketloads of cash to build a brilliant team, the last time Ferguson spent big you got Berbatov (who still has time to prove himself). Ferguson has got a great plan of mixing youth and experience as always, just look at when Macheda was brought on in the games last season. In short he doesn’t need to spend big.

    • James says:

      stop attacking Berba and saying he has yet to prove himself. Joined a team which really did focus everything on getting ronaldo into position to score, which was the right thing to do after the incredible 2007/2008 year. Berba per minutes played covered more ground than Tevez, he scored almost twice as often per minutes played than Tevez and his assists this past season were one of the best in the premier league. He still has room to improve but to say he was a flop or has yet to prove himself is very short sighted. The guy runs when he needs to run and doesnt waste loads of energy per game running around uselessly like tevez and how rooney used to

  23. MAnuforever says:

    we will be just fine,when Ronaldo came he was just like gabriel,who knows if he could replace him r even be greater than he is.The club is the right place for this Lad.Expect us to get the treble,GLORY GLORY MANUTD!

  24. Roy says:

    I hope you are right!!! Time will tell… but if he doesn’t win the EPL and loses in the knockout stages of the Champions League… and United slip down the table to 3rd, 4th or 5th…. what happens then? Suppose he will say he was “re-building the team”. There’s always an excuse for it. On paper (with his present squad) not many people would place money on United winning the EPL again! and have no chance of winning the Champions League. I don’t call this progress, do you?

  25. Tyson says:

    Roy you have no idea what your talking about you need to get educated you are making yourself look like ridiculous. I don’t know of anybody that can talk so much without having a single clue about what they are discussing.

    For anybody that wants to understand the situation from an investment banker who actually has experience in economics this is what is going on in laymans terns. The world right now is in a business cycle contraction.

    During a business cycle contraction a country adopts expansionary macroeconomic policies which involves spreading more money and printing more of it.

    The danger of printing money you do not have is hyper-inflation so most countries are not so quick to do it but the US and UK are being supported by China with loans and bonds so they can afford to print money as it is being propped up with more of it being used in business cycles.

    What it basically means is the Americans and the British are increasing the flow of money which is making both the GBP and the USD weaker for the moment. On the other hand since most European countries are not being helped by China(Off the top of my head only France and Germany are being bailed out by Chinese loans) they can’t print money.

    The result is the Euro is many times stronger than the USD and GBP. If you were a footballer in England and moved to Spain your wages would be dramatically higher considering the huge differences in the two currencies at the moment.

    For Manchester United paying in GBP for a player like Benzema would result in significantly higher wages and a significantly higher transfer fee but because Real Madrid are using Euros they are effectively paying him a lot less due to the lack of inflation with the Euro.

    The difference is the tables do turn very soon. When the restructuring is done in the UK and the USA they will both be fine but countries like Spain are approaching 18% unemployment and have no way out.

    Fergie is just acting like an intelligent business man. Manchester City will end up in storm due to falling oil sales. Oil merchants that rely on oil sales are already experiencing serious problems and holding summits to think of ways to increase the price of oil.

    England actually has a place amongst the future developed nations like India and China and thats more than can be said for Spain. Any business over spending in the UK right now is going to be dead in a few years.

    On the other hand Fergie isn’t in any trouble at all. People talk a lot of about Owen but he had a better goal ratio than Tevez last year.

    Fact of the matter is losing Tevez is gaining somebody that played better than him last season in a team that was able to give him less opportunities.

    Replacing Ronaldo won’t be easy due to his sheer brilliance but in a past season United lost 4 players and signed up 4 nobodies in the vein of Beckham and ended up building a championship team.

    Signing young talent is what Fergie has done so many times before. I mean lets not forget when we “overpaid” for a nobody like Cristiano Ronaldo and replaced him with a British footballing legend people thought we were not going to get anywhere. Look where we ended up.

    Manchester United are still favourites to win the next Premier League title and I predict at least a quarter final in the CL.

    EDIT: Clean version lol

  26. Roy says:

    I think you’re talking bull as far as Man Utd is concerned. Lots of waffle about economics etc etc etc…. blah blah blah. In real terms, United have received 80 million quid, spent only a small portion of this, have allocated nothing for this years’ spending, but pocketed heaps… then you tell the supporters they have a better team. What a load of rubbish! I’ll bet YOU won’t be putting any money on United winning the EPL this year…. and winning the Champions with what they have is a pipe dream. United’s ticket sales haven’t dropped, United’s income hasn’t dropped (regardless of what you say about world economics)… and they have extra millions in the bank, and spent hardly anything. Oh yes, it’s really tough isn’t it at United. They’ll all be taking pay cuts next. What utter waffle and rot. You are getting lost in your own waffle.

    • Tyson says:

      lol you have no clue what you are talking about.

      Listen idiot when the purchasing power of money goes down each and every pound is worth less on the FOREX.

      If you bought a ticket for a United match a couple of years ago at 60 pound and bought that same ticket for the same 60 pound today the value of that same 60 pound would be less today.

      If the stadium is full of 75 thousand people paying the same amount and the currency has inflated 25% then the money being made has also decreased 25%.

      What are you 12?

  27. Roy says:

    Some businesses actually do “better” during an economic downturn. Not everyone feels the pinch. It’s often thought that when people are depressed, they spend more on entertainment… like going to the pictures, or videao shops, or football… or buying themselves small things (like shirts etc). Everyone needs a “small” reward when things are tough. According to your opinion, the whole world is about to stop spending. Bull. I wouldn’t mind betting that the attendance figures this coming year are up from previous year! There’s been many a millionaire created from within a depression, or a war.

    • Tyson says:

      Attendance figures for cheap entertainment go up but if inflation is involved the amount of actual money goes down.

      During inflation your ten pound note is worth less.

      Due to the inflation in the past year alone your ten pound is equivalent to around 7 pound now .

      Your thinking about it all in the wrong way. Currencies fluctuate all the time and the value of money increases and decreases all the time.

      As the purchasing power of your money goes down you have to give more of that money to buy the same thing. If a loaf of bread suddenly goes from 1 pound to 1 pound 40 pence it doesn’t mean the loaf of bread has got more expensive it means ur money is worth less and you need more of it to make a purchase.

      • equals42 says:

        Ok, inflation and FOREX rates are only part of the headwind EPL teams face. There is also the matter of the tax rate that many players have complained about. Isn’t it 50% or thereabouts? It’s a killer when negotiating with a player.

        United lost money last year after debt payments, Roy. It’s a fact. Whether the cash flow is a big enough problem to constrain Fergie is the question for fans.

        PS. Fans will not go to football games no matter what the economics looks like. There is always a tipping point. In either case, they might still go to the game, but buy less jerseys or sodas. Football is not immune to reality. You, however, might be. :)

  28. Roy says:

    Supporters will still go to the football – regardless of the economic downturn… and at United that’s 75,000 bums on seats. Isn’t life tough at the top?

  29. Roy says:

    Bankers know nothing about “business”… that’s why they are Bankers. Just like accountants… who wouldn’t recognise an opportunity if it hit them in the face. I’ve been in business for over 40 years. I haven’t met a Banker who would take any risks at all. All conservative boring people who carry a calculator everywhere they go. They just play with numbers, but create nothing!

    • Tyson says:

      Hedge fund managers and Investment Bankers are the cream of the financial crop.

      They are hired by multi billion dollar organisations to deal with portfolios often in the hundreds of millions.

      Being in business could mean having a little shop in the corner what exactly did you do because you don’t seem to understand how currency works at all.

      I nearly feel like your just pulling my leg at times or your entirely missing the point just to be annoying.

  30. tyduffy says:

    1. Glazer took out a loan to buy Manchester United and transferred the liability to the club. Whether you want to term it “debt” or not, the club owes over £700m to creditors which is increasing with every delayed interest payment. Drink the koolaid all you want Man Utd fans, but that’s a little different than buying a house.

    2. Manchester United aren’t big spenders in Europe? The only team in Europe that spends more consistently to bring in top tier players is Real Madrid under Perez. The signings I listed don’t count the money they flex in lower level signings as well – like £12m for Cristiano Ronaldo.

    • Tyson says:

      You are correct sir it is little different to buying a house.

      People seem to think there is a different set of rules when you have a bigger business but it really isn’t its the same rules that apply to businesses of all sizes. The rules that apply to your home ownership and debt also apply to the likes of Manchester United.

      Your wrong to assume that Manchester United are in any sort of real problem though thats nothing short of ludicrous.

      If you can’t afford to pay your loans the banks would take back and then try and sell off your assets.

      But if Manchester United ever went up for sale do you think there would be a shortage of people wanting to buy one of the biggest football clubs in the world?

      If Manchester United was put up for sale by the Glazers tomorrow do you think there wouldn’t be a person in the world that would be interested in buying the club?

      Don’t forget the Glazers paid way over the odds to the previous shareholders to buy that club.

      If there was any indication a club like Manchester United has been reposessed and is for sale it would generate a torrent of interest.

      Manchester United can afford to do whatever they want as soon as there is any hint of a sale it will be snapped up in a split second.

      If Manchester United do meltdown in the next decade or so through their debts I’m willing to bet an investor probably in Asia(if you’ve ever been to Asia you’ll know Manchester United is fast becoming huge there) would buy the club up almost as soon as it went on sale.

      Manchester United is not going to be liquidised and just disappear as soon as United goes on sale somebody will be at their doorstep.

      • James says:

        Man Utd are in debt but football clubs and more especially those who are like United will never go under or really be constrained by money. No bank will ever contemplate calling in a United load simply because calling it in will mean that in the long term they will lose money form not getting the increased interest rate. Comparing a global brand such as United to a house or anything really is a moot point because United like other internationally recognized teams will always have banks or whoever willing to bail them out.

  31. Mark says:

    I would be very surprised if this is the end for United. I think there are tactical reasons for putting out that they are done. With City and Real Madrid knocking up the market for transfers, why not bide some time until things settle down. I think they found that in the current fluid market prices have gotten out of hand – and I don’t mean out of United’s budget, but as Fergie said on a price to value ratio. I still think they will go back into the market when it suits their needs.

  32. m says:

    The difference here is that when Man Utd have broken previous ransfer records they have been singular club records by the odd million, and given inflation they pretty much work out as similar amounts. It is not just the transfer fees which have now been massively increased, with previous record before transfer window £46m and the Record now £80m – but wage demands have also sky-rocketed which would significantly damage United’s carefully managed pay structure. Man Utd have never paid over the odds for wages and this is where we cannot compete with clubs now willing to pay double what we can offer.

    It is not just about competing with Real and Man City for transfers as they have the capability to raise the price on any player they want and now clubs will automatically add an extra few million to get a part of the Ronaldo £££ pie – but as players and agents will be aware what they can get in wages elsewhere they will demand more than is sensible to pay out. By sensible I mean causing unrest with other stars who will demand wage increases across the board.

    I think you will teams playing the waiting game and leaving transfers till later in the window… this is a shame as it means pre season training will be missed and it will take the first few months of the season for teams to settle

  33. edgar says:

    Manchester United IS in a rebuilding stage. Ronaldo has left. The team was obviously built around his strengths, and now its time to rebuild. Hargreaves is coming back, Rooney will probably be given his preferred position, fresh year for Berbatov to prove himself, hopefully Brown will be healthy again. I see quite a few good signs. Lets see how it goes for United in the first half of the season. I really do not see a weakness. Maybe, maaaybbee, at forward(yep should have bought another forward, i don’t think Owen is going to cut it). I’m really looking forward to seeing Rooney let loose on some defenses though. I miss some of his spectacular shots. I wish we could get Rossi back. With Hargreaves coming back, i fear for my boy Fletcher. I’m guessing it will be Hargreaves and Carrick in center midfield. Park on the left and Valencia on the right. Lets just see how it goes. Fergie has been doing this for 22+years.

    • Roy says:

      I am a big fan of Hargreaves and Carrick (especially) but they don’t seem to play that well when they are pared (don’t know why). I have heard other commentators say this also. I see Own as a “fill in” (or super sub) and hope he can be like Ole in that role (ie: come on and pocket some late goals). Berbatov has to improve. Maybe his game was how Fergie was telling him to play (deep and a link forward). Maybe Fergie will let Berbatov loose along with Rooney. I’m sure Berba and Rooney were supporting Tevez and Ronaldo’s egos a lot. We might see a totally different outcome this year. I hope so.

  34. James says:

    haha to all these supposed Manchester United supporters who say firstly that we will attack Fergie if things go bad at the start of the year, the man is a legend and we real supporters will always stick behind him and never question. Second and slightly off topic in a way but read an article saying some of us worshiped tevez in a Eric Canotnaesque way, bollocks. Tevez ran alot which we all could see but in reality had a rubbish goals to minutes played and assists record and in reality Berba per minutes played ran more than Tevez. Plus there really are no good pics of the little man haha I think Ferguson is legit with his reasons for not spending, he is a stubborn man and if he spent then he is not the one in control, i think that is why he hasnt spent any. Saying that he is being constrained by the Glazers or anyone else i think is short sighted, the man is untouchable and the Glazers know that, if fergie wanted someone he would be given the money to get him.

  35. Pete says:

    First of all Roy you are a complete idiot! its a shame that your a united fan (if you are) your just repeating the same old rubbish in every caption, you have no idea about football or finances and you are making yourself look very silly! I really cannot understand why everyone thinks that it is the end of manchester united as soon as ONE good player leaves the club, Manchester United have been the biggets club in the world for many of years and for one reason, they continue to have the best players in the world, wether they are made at united or bought from another club. i can name a dozen players off the top of my head that in the past decade were the best in the world in there day and LEFT united, but surprise surprise nothings changed! we are still winning trophies! People forget that when ronaldo replaced Becks with the number 7 shirt noone knew who he was, and look at him now!! i also dont understand why the so called “debt” is such a hot topic! the only people in debt are the glazers, Manchester United as a club is a near 700 mill asset, which as Tyson says alot of people in the world would like to have in there portfolio. Also if you know anything about manchester united then you should know not to believe everything that Sir alex says in the media, he is a buisness man as well as the best manager in the world. and if we do finish 2nd 3rd or 4th, it doesnt matter! do you think we have been number on every year since 1878??? the reason sir Alex has not spent all the money is because he doesnt need to! manchester united had a run of 38 clean sheets last season and i can garantee that it wasnt because of Ronaldo, it was because of our unbeatable defense and top class keaper that we still have!!!!!! most of our wins were 1-0 wins so if Rooney, Berbs, Owen, park, macheda, valencia, obertan or anyone else cant manage 1 goal a game between them then maybe Roy you may have something to be worried about! Sir Alex is God and should never be doubted! everyone just needs to relax and enjoy the wonderful game of football for what it is not for what we pay for it!!!!

  36. Lyle says:

    I get the feeling Manchester United will not be winning the league next year. They can’t win it every year and next year seems like a transition year of some sort. Of course they have the quality to win it though and would be the easy bet still.

  37. Roy says:

    Some people are getting the wrong end of things here. I am forever the optimist… but I am also a realist. Looking at the present squad … hands up all those people who think United will win the EPL this year! … I look around the room… and there are none. What about winning the Champions League…. once again no hands are up. Ah well, it’s OK to come 2nd, or 3rd, or 4th (some say that’s OK). If you really are a United supporter, as I am, I want to come FIRST every year! Let’s hope Fergie “is” doing the right thing and being shrewd with his money and team-building. If so, I will be the first to pat him on the back… but if not?

  38. Roy says:

    Looking back in history I don’t think there has ever been a transaction like the Ronaldo scenario… where you buy a player for 12 million…. and after 6 years of great service…. sell him for a profit of 68 million.

    This is a “one off” for sure. Every manager in the world of football is looking for that sort of deal. It was NOT a stroke of “genius” by Fergie…. it was part guessing and hoping… but mainly sheer good luck.

    If I remember correctly it was the “United players” that persuaded Fergie to buy the young Ronaldo (not Fergie himself). Had Fergie been more frugal at the time, and say only offered them 5 million, Ronaldo could have ended up at another club… and the rest would be a different history…. and maybe United might not have won as many EPL’s as they have without his services. Who knows really?

    Let’s hope the coming season brings success (again) with the new line-up. Here’s hoping!

  39. Nikki Edyvane says:

    Do you people actually read the articles that you comment on or are you more interested in looking at the pictures. Ferguson has not critisised anyone for spending over the odds he merely stated a fact. When United see a player that they really want they decide how much they are willing to pay for the player and the stick to that figure. If its more than what people think he is worth then so be it. The difference with this season is Ferguson cannot identify anyone that warrants paying over the odds for and the fact is the prices are being driven up by Real & City’s happiness to pay over the odds. Like Fergie said, if they want to pay these prices then thats up to them and I’m sure if there was a Ferdinand a Rooney or a Hargreaves out there we would be tucking right into our £80million.

  40. Roy says:

    The market price for anything is dictated by what somebody is willing to pay. This applies across the board. If United are not willing to pay it, and somebody else is, then this is a true market value. Everybody has their “own price” on things.

    • DaveMo says:

      Exactly. Someone *else* is willing to pay that price, but Sir Alex is not. Are you arguing that if someone else wants to splash £40M on Benzema, then United should be willing to spend £45M – even though they rated him at £35M? At what point do you allow Sir Alex to say something is overpriced?

      I just read through all 56 comments above, and you have yet to make one cogent point. Second to you is the author of this article who equates United’s purchase of 1-2 players per season with the complete squad purchasing going on at Real Madrid and Man City.

      Manchester United are a going concern. Their income covers their expenses. Even when there is a shortfall, they’re still well in the black when you consider the asset. But a well-managed company doesn’t pay way over the odds for something now, when there’s good reason to expect it will drop back down to a reasonable price soon. Or if they have reason to believe they are well enough prepared without the acquisition.

      Personally, I am anxious to see what happens when one of these billionaire-backed clubs (Chelsea, City) is sold on. I don’t know what’s happening at City, but I’ve read that Abramovich’s investment to buy players is on the books as a loan to the club. Sounds to me like these clubs will eventually have to repay that debt.

  41. JLay says:

    Don’t drink the Kool-Aid. Ferguson is a wily one, and he has reasons for saying what he says.

    By making this statement:

    a) He saves face by blaming the lack of “big” acquisitions on the budget, when the fact is, none of the “top” players wanted to go to England this year. Even as a United fan and a dedicated Real Madrid hater, I can’t deny the appeal. Hell, I’d sign there too if I was offered the chance to play alongside Kaka and CR – better pay, lower taxes and nicer weather too!

    b) He gains leverage in any remaining transfer negotiations. Teams / players that they may be in talks with right now will be motivated to close business with United faster, and at a better prise.

    c) He could throw other clubs off the scent of any remaining targets. This is a big one when Madrid is dead set on hiojecking every move you want to make.

    Taking everything that Fergie says at face value is a bit naive – believe me, if he spots someone he wants and the attraction is mutual, he’ll spend whatever he needs to spend.

    But right now, who would you buy anyway? Seriously…

    I might go after Huntelaar and/or Snijder, but that’s about it.

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