Manchester United debt pile may force owners to fund new stadium
Doubts have emerged over Manchester United’s capacity to fund their £2bn-plus new stadium unless the owners inject cash.
The club announced on Monday that they had secured the land required to build the 100,000-seater venue – dubbed a “Wembley of the North” – from Indurent, which lets industrial units. The 25-acre site is only 350m from Old Trafford.
The club have asked the government for help paying for infrastructure around the stadium but will have to find private funding for the venue build. Manchester United recently restructured £410m of their £1bn-plus debt, with interest rates rising from 3.79 percent to 5.36 percent.
“The environment is not right to build a stadium,” Stefan Borson, a football finance expert and Head of Sport at law firm McCarthy Denning, told Morning Wire.
“We have very high interest rates that don’t look like coming down and it doesn’t look like the owners will underwrite it. Is Man United, even with a 100,000-seater stadium, a football club able to deal with £3.5bn-£4bn of total debt? I say no it can’t.”
The club will boost its coffers by close to £100m next season after returning to the Champions League, but that will be offset by contractual pay increases and the club are expected to be busy in the transfer market to build a larger squad.
It is unclear whether the Glazer family – the majority owners – or minority owner Sir Jim Ratcliffe intend to fund the stadium from their own pockets. “Of course, if the owners stick £2bn in and build the stadium themselves, then there’s no issue,” Borson says. “But that’s not what’s been touted at the moment.”
The club are understood to be open to various funding options – including private or ownership investment – and have engaged with several potential investors in recent months. All options remain on the table as Collette Roche, chief executive of the stadium project, plots next steps.
Debts on other major stadium builds are often financed by income from external events, such as major music shows, but Manchester United’s new stadium would compete against several high-capacity arenas in the region. Borson has also questioned whether there is sufficient appetite for fans to fill 100,000 seats at high prices, although United say they have a waiting list for tickets and are confident of selling out matches.
“Their starting point is a heavy existing debt profile,” he adds. “You have the senior debt, the secured loan and you have the revolving credit facility – effectively the overdraft – and a substantial amount owed to other clubs for historic transfers.
“Presumably because United have made the senior facility a little bigger at $550m (£415m), they won’t need to rely on the overdraft quite as much. But they’re still in an investment phase in the first team, so you would think they’re going to need cash for that.
“The top and bottom of it is: the existing debt isn’t coming down anytime soon. They’re not going to be in a position where they’re throwing off loads of excess cash to start repaying debt.”
Manchester United declined to comment.
Commonwealths to continue Tartan Army party
Organisers are confident the Tartan Army will continue their summer of sporting celebrations when the Commonwealth Games comes to Glasgow next month.
The Commonwealths faced an existential crisis when Victoria, Australia, pulled out of hosting – citing spiralling costs – before Glasgow stepped in to reimagine a major sporting event on a smaller budget. As a comparison, the Birmingham 2022 Games cost £780m, but Glasgow 2026 has cost only £160m.
Scotland fans at the World Cup drank Boston dry while travelling to watch their country compete in their first World Cup in 28 years, and it is hoped those energy levels will not subside.
“If you have seen even just a glimpse of the Tartan Army in Boston, I think you can be undoubting in the incredible spirit that comes with the Scottish fanbase,” Glasgow 2026 chief executive Phil Batty tells Morning Wire.
“We’ll have the World Cup, it will finish just before the Games begin, and that spirit and energy will carry on – not just in Glasgow, but across the whole of Scotland.
“One of the fantastic things about the Team Scotland squad is it really does represent every corner of the nation, and we’re very hopeful that all that energy, passion and enthusiasm will carry on into what is promising to be a fantastic summer of sport.”
England fans fear for safety
England fans at the World Cup were given a scare before travelling from Texas to Boston for last night’s second group game.
Supporters staying in Dallas were sent an “imminent threat alert” to smartphones over the weekend ahead of flash floods. The messages warned: “This is a dangerous and life-threatening situation.”
Notifications advised fans not to attempt to travel anywhere “unless fleeing an area subject to flooding or under and evacuation order”. Another warning told supporters to “turn around, don’t drown when encountering flooded roads”. It added: “Most flood deaths occur in vehicles.”
The mood of panicked England fans was not helped when flights to Boston started to be delayed and cancelled. Fortunately, they had left plenty of time to travel. Some fans had to wait 24 hours before another flight was available.
Army join the World Cup advertising blitz
It may not match the glitz and glamour of a Lay’s World Cup watch party – featuring David Beckham, Steve Carell and Lionel Messi – or Kylian Mbappe starring in Nike’s ‘Rip The Script’ ad, but the British Army has spotted a low-budget opportunity to attract recruits.
Adverts on the London Underground claim that if you use words such as “defend”, “intercept” and “attack”, or “kit”, “formation” and “drills” then “you’re already speaking our language”.
The adverts, spotted inside Tube carriages, feature a soldier seemingly charging into battle, rifle in hand, his top half in helmet and camouflage fatigues, the bottom half a pair of white shorts and socks, about to kick a ball. In another, the half-and-half soldier is dribbling between cones.
“You belong here,” the advert concludes.
Memorabilia collectors cash in on World Cup
Auctioneers are predicting a record sale of World Cup memorabilia when a collection of prized items goes under the hammer later this month.
That largest haul of World Cup artefacts will go under the hammer at Budds, including the jersey worn by Gordon Banks when he made his famous save against Pele in 1970 and the shirt worn by Peter Shilton in 1986 when Maradona scored the Hand of God goal.
They are expected to fetch between £200,000 and £300,000. The auction will also feature items from England’s 1966 World Cup win.
Pele’s 1958 World Cup winners’ medal is set to be the most sought-after item and could sell for as much as half a million.