So, are you sure you've got £60m to spend at Manchester United, Sir Alex?

07 January 2010 07:27
When stories of Manchester United's supposed interest in the unemployed former England defender Sol Campbell surfaced a month ago, manager Sir Alex Ferguson decided it was time to make a point.

After instructing in-house journalists to ask him about the issue, the Scot did not mince his words in reply.

'It's been suggested we were moving for Sol Campbell, that we don't have any money and that we wanted to take somebody cheap,' he said. 'That's all wrong.

'The money is there, if I want to buy someone. There is no question about that. That's a fact.'

Going cheap: Sir Alex Ferguson ruled out moves for freebies like Sol Campbell

Ferguson had, by all accounts, grown tired of suggestions that United were being crippled by the debt bestowed upon them by their American owners, the Glazers. It was, he thought, time to add a voice of genuine authority to the debate.

The problem is, though, that many United followers no longer believe him.

With just £20million of the £80m reaped by the sale of Cristiano Ronaldo in the summer so far reinvested in a team that has shown inconsistent form at times this season and Ferguson showing no signs of spending any more, there are increasing fears that the Glazer regime is for the first time severely impacting on the manager's budget.

Recent revelations that the Glazers are trying once again to reorganise their enormous £700m debt, this time by attempting to chop part of it up into saleable bonds, have certainly set alarm bells ringing.

So, for some time, has the series of small cuts behind the scenes at Old Trafford that smack of a big football club desperately trying to make tiny savings wherever it can.

Redundancies have recently been made in the accounts department, for example. Some staff are no longer entitled to free lunches at the Carrington training ground and at Old Trafford on match day.

Meanwhile, some contributors to the match-day programme and official club magazine have complained of slow payment.

Brothers Grim: (left-right) Joel Glazer, Avram Glazer and Bryan Glazer

United admit that cuts have been made at the club but argue that they are merely behaving in line with the way any large company would in an attempt to offset the effects of a worldwide recession.

The club also claim that the transfer budget for Ferguson is separate to that used to cover day-to-day running costs and point to the fact that a £30m cash offer was made to French club Lyon for the striker Karim Benzema in August as evidence that Ferguson does have cash at his disposal.

That, however, was August. This is now. And it is beyond doubt that the Glazers' financial grip of affairs at the club they bought in 2005 is becoming ever more precarious.

Having taken on debts of £598m to take the club into private hands four-and-half years ago, the Glazers have subsequently seen that figure rise to £699m and beyond.

This is largely because of the phenomenal interest due each year on the £275m they borrowed from three hedge funds at the time of the takeover.

In the financial year ending June 2008 United's last published accounts as much as £60m was paid in interest alone. That's £165,000 a day.

With one bout of refinancing having taken place on the whole debt in 2006, the Glazers are now thought to be embarking on another, aimed specifically at rearranging the section still owed to the three hedge funds.

Sugar daddy: Chelsea's Roman Abramovich and Man City's Sheikh Mansur

Neither the family's spokesman nor banks JP Morgan and Deutsche Bank have denied suggestions that the two institutions have been instructed to arrange a bond issue, something that would alleviate the immediate pressure of continuing to service their debt at high interest levels but would in all likelihood only add to the overall debt in the long term.

At United, the mood remains relatively sanguine.

With Chelsea and Manchester City learning in recent times City just this week that their billionaire owners have wiped out the debt owed to them, United remain sceptical about their rivals' long-term financial outlook.

How, they reason, do those clubs continue to pay their enormous wage bill if Chelsea's Roman Abramovich or Sheik Mansour at Manchester City choose to sell up and walk away?

Nevertheless, thousands of United followers remain deeply resentful and suspicious of their own owners. To them, they are not the Glazer brothers but the Brothers Grimm, those tellers of tall tales from the 1800s.

During the Glazer years, supporters have seen trophies continue to arrive but they have also seen ticket prices rise and net spending on players remain relatively low.

The family have always denied that they would resort to such drastic measures as selling the naming rights to Old Trafford to raise money or indeed selling the stadium altogether and leasing it back.

To the rank and file, though, those fears remain in the forefront of their minds.

A large cheque written out at Ferguson's behest, signed by chief executive David Gill and offered to a club such as Bayern Munich for a player such as Franck Ribery would go a long way to settling a few nerves, of course.

For now, that doesn't look like happening. It is perhaps no wonder that suspicions of parsimony remain.

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Source: Daily_Mail