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27% rise in their debt...in one quarter!

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27% rise in their debt...in one quarter!

Post by blueboy on Fri Feb 10, 2017 8:14 am

http://www.dailymail.co.uk/sport/football/article-4207704/Manchester-United-blame-rising-debt-Brexit.html

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Re: 27% rise in their debt...in one quarter!

Post by blueboy on Fri Feb 10, 2017 8:16 am

Add to that the projected £83m they could lose if they don't finish in the CL places!! Wink

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Re: 27% rise in their debt...in one quarter!

Post by Topdawg on Fri Feb 10, 2017 10:55 am

The main reason for the rise in debt is supposedly the very weak pound against the dollar. But still, shouldn't be allowed if we got punished under FFP.
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Re: 27% rise in their debt...in one quarter!

Post by leopold on Fri Feb 10, 2017 1:06 pm

I'm sure the pound hasn't dropped that much against the dollar.  27%?  Surely we'd be in a bit of a financial crisis on that basis?
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Re: 27% rise in their debt...in one quarter!

Post by Topdawg on Fri Feb 10, 2017 1:28 pm

before brexit, up to $1.47 to the £. Mid Jan, $1.20 to the £.
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Re: 27% rise in their debt...in one quarter!

Post by shakencity on Sat Feb 11, 2017 10:48 am

No one gives a shit about their rising debt tbh, no one really ever has or they wouldn't have been able to get in the financial mess they're been in since the Glasers took over ....It's all about their rising profits, trying to wipe that debt off.

It pisses me right off when lower league clubs are hauled up in court over a 40k late tax bill and threatened with liquidation, transfer embargos and closure....when the like of the Rags are over £400m in debt and still allowed to spend £200m a season on player transfers Mad .
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Re: 27% rise in their debt...in one quarter!

Post by Topdawg on Sat Feb 11, 2017 10:54 am

But their debt is structured. The small clubs have overspent or just not paid the bills.
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Re: 27% rise in their debt...in one quarter!

Post by blueboy on Sat Feb 11, 2017 12:33 pm

But their debt is rising, not being paid off since they took over. They've had what, 6 years to pay off the debt that started at £560m....they got it down to a low of £330m, now it's back over £410m??

I agree with Den...what if there was a massive financial crisis and they lost heavily?

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Re: 27% rise in their debt...in one quarter!

Post by shakencity on Sat Feb 11, 2017 1:15 pm

It doesn't matter Andy, as "it's a structured debt".....but that doesn't seem to be working too well now does it Rolling Eyes .

Oh and I completely get what you're saying by the way Dawg....as it's true.
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Re: 27% rise in their debt...in one quarter!

Post by Topdawg on Sat Feb 11, 2017 1:29 pm

It is structured debt that they are paying off as per their loan. The problem with the smaller clubs is that they use unstructured debt such as overdrafts and not paying bills (usually big ones to the taxman).
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Re: 27% rise in their debt...in one quarter!

Post by blueboy on Sat Feb 11, 2017 1:44 pm

So let's say.....The Glazers are in to United for £600m. 

There's a massive Black Monday on the financial market and they lose £1b. They still have a structured debt to pay back every month - somewhere close to £65m per year in interest, but now, they don't have that money...or are able to borrow money to service the money they've just lost or the monthly payments.

We know there are some big players out there, but who is possibly going to come in and buy Man United, because they'll want to sell the club with it's debt - not for £0.01. They'll want money back....all the while, the debt is accumulating week on week.

Somebody would have to be happy to pay to service that debt in full, OR, start again with a restructured debt, probably at a higher premium. Which means, they'd buy the club and be immediately, £600-800m in debt.....who in their right mind would look at that as a good business model? How many years would it take to claw that money back, even for a club as big as United? It only takes one or two years out of the CL and we've seen how that affects United's profits massively (£100-150m in lost revenue - add that to the debt). Somebody like Sheikh Mansour would have to be happy spending £1b on a club and accepting that they won't make a penny for at least 5-10 years.

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Re: 27% rise in their debt...in one quarter!

Post by Topdawg on Sat Feb 11, 2017 1:56 pm

I agree up to a point. A financial crisis like the one you're hypothesising would screw many a club.
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Re: 27% rise in their debt...in one quarter!

Post by blueboy on Sat Feb 11, 2017 2:20 pm

Not ours... Razz Razz Razz

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Re: 27% rise in their debt...in one quarter!

Post by skyblueoz on Sun Feb 12, 2017 6:00 am

whatever happened to the PIK loans they took out to refinance in 2012 or 2013? I thought they were short term loans to be paid back around 2016 or 2017 at around 15% interest. If that is the case then surely those loans are about to be called in which will mean more debt for them.
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Re: 27% rise in their debt...in one quarter!

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