May 8, 2013, 12:44 PM EDT
As the news about Sir Alex Ferguson’s retirement continues to reverberate around the globe, one area many will be looking at is the stock market.
With Manchester United registered on the New York Stock Exchange, the club was obligated to inform the NYSE about Ferguson’s decision to retire, which ultimately led to the news being leaked earlier than the club expected.
The news was actually announced while US markets were closed, but when trading began in New York this morning the club’s shares fell as much as 4.5%.
Since the Glazer family bought United in a controversial deal back in 2005, the debt laden club have soared to success commercially. The value of the Manchester United brand is approximately $3.17 billion. They should survive, with or without Ferguson.
However recently there has been a concerted effort by the Glazers to drive down debt, with a bond issue in 2010 raising £500m, and a 10% flotation of the club on the New York Stock Exchange raising some £150m, half of that has gone towards reducing debt.
But with Ferguson on the way out and investors watching intently as to who will replace him, should Manchester United fans worry about future financial problems?
Yes and no. On the plus side, when you scroll through Manchester United’s website no fewer than 33 different sponsors appear and commercial revenue is through the roof.
United recently posted their financial results in sales for the third quarter, a record £91.7m ($143m) was generated through sponsorship deals and Champions League revenue. The clubs debt now stands at $571 million, a lot healthier than the $1.11 billion that rose to in 2009.
But all those numbers don’t mean much, unless you have a winning team.
The Manchester United brand means winning. It has been associated with that since the early 90s, growing up in England during that time period, it seemed like you couldn’t walk down any High Street in the country without the famous “Glory, glory Man United” song blaring out, a Cantona No. 7 shirt being worn and just about every piece of merchandise you can think of adorning their Red Devil mascot.
Fred the Red, as he’s known, gets everywhere.
Sir Alex Ferguson was the main man behind all the on-field success that drove the financial success. Now he is gone, a replacement who can carry on his work seamlessly and without much upheaval is paramount to United’s success as a soccer team, and as a business. Jose Mourinho would ease concerns for United’s financial backers, while David Moyes in charge could send share prices into a spin, as investors panic about the Scotsman’s lack of experience on Europe’s biggest stage.
We can’t judge United’s commercial success over the next few years. But in 2022 we may look back and point to May 8, 2013, as the day the Manchester United brand started to go downhill.
But with Ferguson’s new role as both a director and ambassador for the club, that’s unlikely to happen. He helped build this club up, almost doubling the capacity of Old Trafford and spreading the club from the red half of Manchester to the far flung corners of the globe.
One final number. In the 1992-93 season Manchester United’s revenue was £25.2 million. During the 2011-12 season, it stood at £320.3 million. Safe to say that Ferguson has left United in a much better position than when he arrived at Old Trafford in 1986.
Now it’s up to the new guy to carry on his good work.
Mar 29, 2015, 11:27 PM EDT
Are Saints about to lose another young star to one of the Premier League’s “big five?” We’ll find out this summer.
Mar 29, 2015, 10:52 PM EDT
Kane will join England’s U-21 squad for this summer’s European Championship.
Mar 29, 2015, 9:18 PM EDT
No fun for 70 minutes, and then the final 20 happened. TFC’s criminally disallowed goal was the only difference in this one.
Mar 29, 2015, 8:48 PM EDT
There’s a real reason, other than “easy schedule,” for England’s improved performances since the World Cup.
Mar 29, 2015, 6:55 PM EDT
Harry Shipp. Harry Shipp. Harry Shipp.
Mar 29, 2015, 5:58 PM EDT
Sterling isn’t interested in negotiating a new deal until the summer — even if it’s for $270,000/week — and a few reassurances are made.
Mar 29, 2015, 4:45 PM EDT
Who’s on top of Groups D, F and I at the halfway point?
Mar 29, 2015, 2:55 PM EDT
Luis Suarez was candid as ever after Gerrard’s charity match, and he opened up the possibility of a Premier League return down the road.
Mar 29, 2015, 12:05 PM EDT
Thierry Henry showed off his sparkling passing skills at Steven Gerrard’s testimonial.
Mar 29, 2015, 10:43 AM EDT
The United States loses one of their goalscorers from Friday’s friendly, but now it’s a youngster’s turn to make a statement.
Mar 29, 2015, 10:14 AM EDT
A whopping turnaround, led by owner Katharina Liebherr, has taken place at St. Mary’s and the financial evidence is there.
Mar 29, 2015, 9:40 AM EDT
If Adnan Januzaj wants to make a return to the Belgium squad, he must focus on earning playing time at his club first.
Mar 29, 2015, 8:13 AM EDT
An agreement has reportedly been reached between the current American owner and a domestic ownership group.
Mar 29, 2015, 7:34 AM EDT
Gareth Bale knows what people are saying about his recent play at Real Madrid, but he’s not listening.
Mar 28, 2015, 11:30 PM EDT
Catch up on all the action from Week 4 of the MLS season.
Mar 28, 2015, 10:41 PM EDT
A disappointing result for FCD, given Seattle’s lack of Dempsey and Martins, but a great one considering their early red card.
Mar 28, 2015, 10:06 PM EDT
Three more points for Vancouver, who win it late on Robert Earnshaw’s Whitecaps debut. He scores for everyone.
Mar 28, 2015, 9:15 PM EDT
It was the late, late, late show at RFK Stadium, and despite being thoroughly outplayed, D.C. United go home with three points.
Mar 28, 2015, 9:04 PM EDT
Sporting KC get their first victory of the season, while NYCFC suffer their first defeat of the year — and history.
- MLS Snapshot: Real Salt Lake 2-1 Toronto FC 2
- EURO 2016 qualifying roundup: Germany back on track; Portugal beat Serbia, go top 0
- Report: Aston Villa owner Randy Lerner set to sell team to UK group 0
- MLS roundup: Whitecaps, D.C. United win late ones; FCD, Sounders in disappointing draw 1
- MLS Snapshot: FC Dallas 0-0 Seattle Sounders 0
- MLS Snapshot: Vancouver Whitecaps 2-1 Portland Timbers 2