The recent news that Qatar’s Sheikh Jassim bin Hamad al Thani has refused to raise his bid to acquire Manchester United for more than $6 billion has left the remaining bidder, Ineos chairman Jim Ratcliffe, in a stronger position. Ratcliffe has offered to buy only a 25% stake in the club, allowing some of the Glazer family to cash out. While the exact value of Ratcliffe’s bid is unknown, sources suggest it is higher than Jassim’s offer. Manchester United is currently valued at $3.3 billion by the stock market.
Sheikh Jassim had also promised to invest more than $1.7 billion in the club after the acquisition, but following nine months of unsuccessful negotiations, he has informed the Glazers that there is no point in remaining in the bidding process. Jassim’s bid would not have used any debt to acquire the club and would have paid down Manchester United’s existing debt pile of over $600 million.
The Glazers’ valuation expectations for Manchester United have been aggressive, with previous soccer deals providing a benchmark. For example, the acquisition of Chelsea Football Club last year valued it at 5.7 times revenue for its last financial year. Valuing Manchester United at more than Jassim’s bid, such as $7 billion, would be equivalent to 11 times the club’s revenue over the last 12 months.
The Glazer family, who made their fortune in real estate, retail, and healthcare and also own the NFL’s Tampa Bay Buccaneers, bought Manchester United for 790 million pounds ($960 million) in 2005. The six descendants of Malcolm Glazer, who passed away in 2014, control 96% of the club’s voting stock.
Manchester United, with over 650 million fans worldwide, has seen a significant downturn in its fortunes under the Glazers’ ownership. The club has won only one top-flight title since former manager Alex Ferguson’s final season in charge in 2012-13. While they won the League Cup this season, their third-place finish in the league, 14 points behind local rivals Manchester City, highlights the need for a turnaround.
With the Glazers exploring the possibility of cashing out on their ownership, many fans have been calling for a change in ownership. The outcome of the bidding process will determine the future direction of one of the most iconic soccer clubs in the world.
Note: This commentary aims to provide an insightful perspective on the news of Sheikh Jassim’s refusal to raise his bid for Manchester United. It adheres to the guidelines of EcoReporter, ensuring that the content is appropriate for all audiences and does not contain mature themes.
