Sir Jim Ratcliffe’s £1.3 Billion Deal For Manchester United Delayed
October 19th looked like a key date for the conclusion of Manchester United’s takeover saga. However, further delays are expected in ratifying Sir Jim Ratcliffe’s proposal for 25% of the club for a rumoured £1.3 billion.
While a board meeting still went ahead between the 12 directors, including the six members of the Glazer family, the complexity of Sir Jim Ratcliffe’s proposition means further deliberation is needed.
Delays and extensions have been no rarity in the Glazer’s haphazard approach to selling the prestigious Premier League club, which has enraged, frustrated and depleted both bidders and fans.
It is nearing a year since the Glazer family opened themselves to proposals for Manchester United back in November 2022, and by January of 2023, Sheikh Jassim and Sir Jim Ratcliffe emerged as the most serious and prominent bidders.
However, after a summer of silence, Sheikh Jassim withdrew his immense proposal of over £5 billion for 100% of the club, annoying the Manchester United fanbase further who, through the Qatari buyer, had seen a glimpse of Old Trafford life post-Glazers.
Rumoured promises of signing Kylian Mbappé and a clearing of club debt faded through reinforced clarification of Sheikh Jassim’s abandonment of the deal from his representatives this past weekend.
No longer with public opposition, Sir Jim Ratcliffe is firmly in the driving seat to gain a stake, and even eventually, full ownership of the club if the British billionaire’s plan is successful.
However, what will change at Manchester United with their new shareholder and what form will his 25% acquisition take?
Ratcliffe’s 25% Control
The premium price Sir Jim Ratcliffe is prepared to part ways with might baffle fans for only 25% of the club, however, Ratcliffe’s deal has an integral clause – full sporting control of football operations.
This in effect severs Manchester United into two sections; the football side, which Ratcliffe’s 25% stake will have control and responsibility over, and the Glazer’s commercial stake, which suits their expertise.
With Ratcliffe being a ‘life-long’ United fan and with the appropriate tools and network through his INEOS sporting group, his involvement would be a welcome one compared to the disparity shown by the Glazers in football decisions.
His immediate propositions include overhauling training facilities at Carrington, expanding Old Trafford to a capacity of 90,000 and restructuring personnel in football operations.
Delving further into Ratcliffe’s INEOS sporting network, the corporation has stakes in the Mercedes AMG F1 team, GB sailing, and most notably, Ligue 1 side OGC Nice. This last example can give us the most accurate depiction of the sporting direction Ratcliffe will take with Manchester United.
Having acquired the French side in 2019 for £88 million, the footballing start for Ratcliffe was mixed and rather one of stagnation. Nonetheless, having qualified for the Europa League last season and currently 2nd in Ligue 1 after an unbeaten start, Ratcliffe’s fortunes at the French side are changing.
What makes Ratcliffe’s improved results on the pitch at OGC Nice more impressive is the stability offered behind the scenes, which is much needed at Manchester United.
Clear support to strengthen academy grown talent, appointing Christophe Galtier as manager and a transfer policy that has kept the average age of the team at 24 have all proven as smart decisions that have manifested into a positive formula.
Where Will The £1.3 Billion Be Going?
Manchester United need an injection of liquidity to cover many financial issues at the club but the breakdown of Ratcliffe’s £1.3 billion investment and where exactly it will go remains a mystery to those curious about the deal.
This is because the allocation of money from the deal largely depends on its structure and share formation.
Ratcliffe’s initial proposal back in November 2022 was to buy out the Glazers’ exact shares, however, this was disparaged by the New York Stock Exchange shareholders who threatened legal action and this was because this deal would devalue their stake in the club.
Therefore, we are left with two scenarios for how Ratcliffe’s current deal will pan out:
Scenario 1 – Ratcliffe directly purchases an equal split of shares from all shareholders
If this were to happen Sir Jim Ratcliffe would dilute all existing stakes and would become the single biggest voting power at the club with 21.4% of the voting power. The Glazers, however, could still group together and eclipse this.
In this deal structure, the £1.3 billion would simply go to those he has purchased the stakes from, meaning further investment would be needed on top of the initial fee to fund facility renovations or January transfer plans.
Scenario 2 – The Glazers create more shares for Ratcliffe to then purchase
This deal structure would effectively dilute the Glazers’ existing shares which has not been an uncommon tactic in their tenure at the club. Once again, the Glazers collectively would still control the major voting shares.
However, this would mean a bigger proportion of the £1.3 billion investment would go into the club itself. For Manchester United fans seeking a larger spend in January after their worst start to a Premier League season in 30 years, this could offer more immediate reinforcements.
The eventual outcome could be a mixture of these two situations and we will ultimately find out the deal’s structure when announced on the New York Stock Exchange.
What Does The Long-Term Future Look Like Under The Ratcliffe Reign?
With United in transition, here are my three key takeaways for how Manchester United will shape up after the Ratcliffe deal:
Shakeup Of Manchester United’s Sporting Operations
With Ratcliffe’s open criticism of the club’s sporting decisions and organisation, be prepared for a rearrangement of its structure. John Murtough and Richard Arnold seem in danger of replacement with Paul Mitchel being a rumoured arrival with his club experience and recent move to the Manchester area.
It is assumed however that Erik Ten Hag will keep his position with Ratcliffe a fan of the Dutch coach.
The Glazers Remain (For Now)
Whilst this is majorly frustrating for fans who dreamed of a clean break from the Glazer family, there is promise that their grip is slowly weakening. Now just running the commercial elements of the club, hopefully, this puts an end to a bizarre and last-minute Manchester United football policy.
Slow Start To The Ratcliffe Era
It can be hard to see this situation as a positive against the backdrop of Sheikh Jassim’s more commanding proposal for Manchester United being preferred by many fans. However, Ratcliffe’s sporting ownership, whilst not being so flash, is a viable way for Manchester United to return to its former glory.
Ratcliffe’s deal is expected to be finalised in the next fortnight after these extra delays. Yet, we will have to see what effect the Premier League Owners’ and Directors’ Test has on the immediacy of the deal and his influence in the club.
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