Man Utd goes £137m into the red By Roger Blitz FT: April 14 2007 The Glazer family's takeover of Manchester United resulted in a pre-tax loss of £137.7m in the club's holding company, figures filed at Companies House reveal.
The accounts for Red Football, set up by Malcolm Glazer for the deal, also show for the first time that the actual amount paid by the Glazers was £809.1m. The figures were disclosed as the club extended the contract of Cristiano Ronaldo, one of its prized assets, by five years, in one of the biggest deals in British football. According to the accounts, after a net asset valuation of £286.8m, the goodwill generated from the deal comes to £522.4m, depreciating by £39.2m a year over 15 years. Interest payments on debt of £598m totalled about £85.2m in the 14 months between May 1 2005 and June 30 2006, divided between £27.2m from cash flow and £57.9m in high-yielding payment-in-kind notes. The accounts are the first declaration by the Glazer family, owner of the Tampa Bay Buccaneers NFL team, of the scale of the club's indebtedness needed to secure the takeover. The family waged a protracted battle with the board before securing the takeover. However, the club's success on the pitch - it leads the Premier League and is in the semi-finals of the Champions League and the FA Cup - has eased pressure. The Glazers refinanced the debt last August, raising the total debt to £660m but reducing the debt servicing to about £60m. A spokesman for the Glazer family said the accounting losses had "absolutely no bearing on the strong underlying financial performance of Manchester United, which is presently enjoying record revenues. "The Glazer family is committed to continuing to invest in the club's future . . . " Manchester United reported in January that the club had made a £31m profit in the 12 months to June 30, with earnings at £46.3m. Red Football's earnings were £10m lower, the result of costs borne in the last two months of the accounting period. People connected to the Glazer family said the accounting losses were expected and reflected the cost of financing the old capital structure of the club, the depreciation of goodwill and exceptional one-off takeover costs. [Non-text portions of this message have been removed] Please use [EMAIL PROTECTED] for general discussion. To unsubscribe send a blank message (from the email account in question) to: [EMAIL PROTECTED] Join as a full member of IMUSA today: http://www.imusa.org/join.htm Yahoo! Groups Links <*> To visit your group on the web, go to: http://groups.yahoo.com/group/imusa/ <*> Your email settings: Individual Email | Traditional <*> To change settings online go to: http://groups.yahoo.com/group/imusa/join (Yahoo! ID required) <*> To change settings via email: mailto:[EMAIL PROTECTED] mailto:[EMAIL PROTECTED] <*> To unsubscribe from this group, send an email to: [EMAIL PROTECTED] <*> Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
