Things go from bad to worse at Old Trafford.
Debts at the parent company of Manchester United have increased to £716.5m ($1.17bn), according to its latest accounts.
Red Football Joint Venture is owned by the Glazer family and secures its debts against the football club.
The accounts, for the year to June 2009, show United’s debts passing £700m for the first time.
They also confirm that six of Malcolm Glazer’s children were each given loans worth £1.67m from the parent company.
All are directors of Red Football, and such a practice is legal.
However Keith Harris, the head of merchant bank Seymour Pierce who has been involved in four Premier League club takeovers, questioned whether it was sensible.
“You would not expect directors to be borrowing money at a company of United’s size,” he told the Guardian newspaper.
“And, although it is now allowed legally, it is generally still frowned upon because it does not create a good impression of the directors’ governance of the company.”
The club’s fans have recently protested against the Glazer’s ownership.
After last week’s revelation that the club was considering raising £500m through a bond issue to refinance its debts, supporters held up a banner saying “Love United, Hate Glazer” at Saturday’s home match against Burnley.
Mark Longden, chairman of the Independent Manchester United Supporters Association, said then that United was being “driven to oblivion”.
The accounts of Red Football Joint Venture also showed that more than £69m was paid out in interest alone over the year. (BBC Sport)
Things seem to go from bad to worse at Old Trafford and there it seems that barely a day goes by that doesn’t unearth yet more financial woes for the Premier League champions. If I were a Manchester United fan I would be very worried right now and I would fully back any fans looking to protest at the way the club is being driven into the ground.
One wonders what will happen if the club continue to leak money in the fashion they currently are. Will players have to be offloaded? What happens if Sir Alex is not backed in transfer window because the club can not afford to bring in players he requests, would he feel he had no choice but to jump ship.
It seems that those who originally predicted that the Glazers were only looking for a cash cow to milk would appear to have been right all along. I sincerely hope the Old Trafford outfit can find a way out of this mess but it would appear that the only way that would happen would be if someone came in and bought out the American owners but given the size and scope of the club I see no reason why that wouldn’t happen.
If well run Manchester United is clearly a club that should be able to make large sums of money and therefore the fact the club is in such debts is hugely indicative of the way the Glazer family has run the club so disastrously.