Soccer

Manchester United owners warn investors

Failure to reach Champions League again would hit income and put off top players

Devil in the detail: Manchester United’s prospectus revealed income from their new 10-year kit deal with adidas will drop 30 per cent from #75 ¤95 million to #52.5 ¤66 million per year if it fails they fail to qualify in two consecutive seasons for the Champions League.
Devil in the detail: Manchester United’s prospectus revealed income from their new 10-year kit deal with adidas will drop 30 per cent from #75 ¤95 million to #52.5 ¤66 million per year if it fails they fail to qualify in two consecutive seasons for the Champions League.
Fri Aug 01 2014 - 01:00

Manchester United’s owners have warned potential investors the club may fail to attract or retain top players and coaches if they fail to qualify for the Champions League again this coming season.

The Glazer family, who own 90 per cent of the club, have announced plans to sell another five per cent, eight million shares, which would see them earn around $150 million (€112 million).

All the proceeds will go to the Glazers' investment vehicle Red Football LLC and not to Manchester United – which will fuel anger from fans' groups who have often claimed the Glazers are taking money out of the club.

It their prospectus, United have warned of the implications of missing out on the Champions League again and revealed income from their new 10-year kit deal with adidas will drop 30 per cent from €95 million to €66 million per year if they fail to qualify in two consecutive seasons.

READ SOME MORE

United sacked David Moyes as manager after failing to make it into the elite European competition last season, and the cost of successor Louis van Gaal failing to do so again has been made clear to investors.

Prestige

The prospectus says: “Because of the prestige associated with participating in the European competitions, particularly the Champions League, failure to qualify for any European competition, particularly for consecutive seasons, would negatively affect our ability to attract and retain talented players and coaching staff, as well as supporters, sponsors and other commercial partners.

“Failure to participate in the Champions League for two or more consecutive seasons would also reduce annual payments under the recently announced agreement with adidas by 30 per cent of the applicable payment for the year in which the second or other consecutive season of non-participation falls.”

United’s combined broadcasting and matchday revenue from Europe was €49 million, €53 million and €75 million for 2013, 2012 and 2011, respectively. Manchester United’s shares, which rose sharply after the announcement of the adidas deal, closed at $19.31 in New York on Wednesday.