Greed and poor decision-making at the root of the Glazers-induced Manchester United crisis

Without a league title in nearly a decade, and after giving up their regular place in the UEFA Champions League, the United faithful have turned on the ownership in what has been a complicated tenure.

Manchester United co-owners Avram Glazer (L) and Joel Glazer (R) in view, (Reuters)

Despite their lack of success on the pitch and their evident mismanagement, United remain one of the most profitable sports teams on the planet. They are the fifth-most valuable football team according to the 2022 Deloitte Football Money League and have kept their place among Europe’s elite.

But their immense global fanbase, high matchday revenue, and solid commercial operation were all established before the Glazers took over. After seeing the family reap the benefits of the revenue streams established before, without investing into the club themselves, fan sentiment could not be worse. According to Twitter user and blogger Swiss Ramble and The Independent’s findings of the club’s finances, it is easy to see why.

Glazers’ appetite for profit

The blogger has claimed that the Glazer family has taken heaps of money out of the club – a staggering approximate of £1.1 billion since 2005 – which includes interest payments, loan repayments, directors’ fees, management consultancy fees, and dividends.

After Manchester United’s awful start to the season, the focus has once again turned to the Glazers. This thread will look at some of the reasons why the club’s fans might be unhappy with their owners – from a financial perspective #MUFC

— Swiss Ramble (@SwissRamble) August 16, 2022

To understand how much money the Glazers cost United, three major aspects must be taken into account – debt, interest payments, and dividends.

As per The Independent, United, a debt-free club up until the Glazer takeover, had a huge £550 million loan loaded onto it, and the figure went up to over £700 million at one point in 2010. Despite various means of refinancing, United’s gross debt which stood at £604 million in the Glazers’ first year in charge, stands at £592 million today, 17 years later.

The interest payments to service that debt, which the Glazers saddled the club with in order to finance their takeover, have been massively high. The Independent reports that at their peak, interest payments have crossed £40 million annually at a rate of 16.25%, and even as of 2021-22, they paid £18.2 million in interest. The publication reports that United have paid a total of £743 million in interest alone.

A huge issue that fans of the club have raised recently is the fact that United is the only club in the Premier League to pay its shareholders, the majority of which are the Glazers, dividends. According to NASDAQ, the club regularly pays its ‘Class A ordinary shareholders’ a fixed dividend bi-annually since 2016. The Independent reports this figure to be at £22 million per season.

According to the Swiss Ramble’s analysis of owner funding into Premier League teams in the last 10 years, owners at Chelsea, Manchester City, and even the American capitalists at Arsenal and Liverpool have put in hundreds of millions into their clubs, but the Glazers have taken out £154 million in dividends and share buybacks. Old Trafford, which still makes massive matchday revenue, has seen no upgrades or improvements, and the Glazers’ capital expenditures fall behind teams like Leicester and Fulham.

The Glazer formula has seemingly been reliant on the fact that performance on the pitch is not required to run a successful commercial operation, especially if it is already in place. But their underperformance on the pitch has begun to affect their revenues.

The Swiss Ramble analysed the growth in commercial revenues of the Premier League’s ‘Big Six.’ Since 2017, United’s commercial revenue has taken an £85 million hit, nearly 15%, and even with Covid-induced losses, the commercial revenue of Tottenham, Manchester City, and Liverpool have all increased by more than £90 million.

Looking at the manner in which the Glazers have ripped the club apart for profit (Swiss Ramble reported that at least an additional £465 million have been made with the sale of ‘Class A’ shares over and above the £1.1 billion amount mentioned earlier), without any results on the pitch, fan sentiment is understandable. But with United falling out of the Champions League regularly, and with their trophy cabinet empty since 2017, there is an argument to be made that the financial health of the club, due to declining commercial revenues which are the backbone of the Glazers’ ownership, has also suffered.

Finally, the Glazers have made a fortune by selling some Class A shares in #MUFC, which works out to at least £465m (potentially £514m if underwriters took up the option to buy more shares). The club did “not receive any proceeds from the sale”, so only the owners benefited. pic.twitter.com/ncFnDUPe8u

— Swiss Ramble (@SwissRamble) August 16, 2022

However, the Glazers have been running the club this way since 2005, and up until the club was succeeding under the leadership of Alex Ferguson, protesting the ownership was hardly a mainstream view. It was not until after he left in 2013, when football economics changed and billionaire owners spending prolific amounts of money on transfers and wages became the norm, did the problems start getting highlighted.

Footballing flaws

While the Glazers’ lack of investment in the team is obvious, the club’s massive commercial revenues have filled in to ensure a massive, albeit misdirected transfer spend of over £850 million in the last five years. It’s an area that can only be considered a massive failure for the club.

Their recruitment has not only been ill-advised, but they have had no tactical blueprint to accommodate even the right players that come in on big-money signings. Their reliance on star-power in this time has failed them. The Cristiano Ronaldo situation is unravelling itself at the moment, and moves for Harry Maguire and Jadon Sancho are far from paying off. Previously, both Romelu Lukaku and Alexis Sanchez have cost heaps of money but accepted the first exit ticket out of Old Trafford to Inter Milan.

But no player defines United’s messy recruitment and performance more than Paul Pogba. The Frenchman was let go by United in 2012 for free to Juventus, an evident mistake as the club spent a then-world record fee of £90 million to bring him back four years later.

At 23, Pogba came back to United as one of the best midfielders in the world. For all his commercial power – dabs and dances, hashtags and hairstyles, included – he was a generational footballing talent with the technical ability, flair, and physical stature that few midfielders can boast of even today, but one that United could get nothing out of under three different managers. In July, he moved back to Juventus on a free transfer once again.

In an era of the Premier League dominated by high-profile coaches that elite teams see as their biggest asset now, United have not got it right in that department either. A spectacularly unsuccessful stint with Jose Mourinho between 2016-18 aside, none of Europe’s big names have coached the club, and the tactical rigidity of their poorly assembled squad is telling.

Chelsea’s Thomas Tuchel comes together with Spurs boss Antonio Conte (Reuters)

On Sunday, Chelsea’s Thomas Tuchel and Spurs’ Antonio Conte were embroiled in a fascinating and fierce tactical (and physical) battle. Their teams took turns outplaying and out-thinking each other in different phases of the match, thanks in large part to the fluidity of their playing options. United – once linked to both managers – likely lack the tactical nous or the positional fluidity to participate in such a battle. The gulf between them and the Premier League’s elite is apparent.

Ten Hag, whose stock in Europe has risen during his successful stint at Ajax, came in to address exactly that. But just two league games have exposed how much work is still required at the club. And if the decade gone by can provide any proof, he is unlikely to get the support that he requires from the ownership, without which the club is likely to remain in crisis mode indefinitely.