Reds Knights Group update

A bid from the Red Knights was originally anticipated shortly before the World Cup, but indications received from the Glazer family suggested an unwillingness to consider a reasonable price at this time making any bid a token gesture. However, that doesn’t mean that the Red Knights have either given up or gone away. The simple truth is that, true to form, the Glazers wanted far too much money and it may take some time (and pressure) to convince them that their taxi is waiting outside.......

The leaders of the Red Knights Group are serious business people who got involved in this project with us because they couldn’t stand to see what was happening to our club. Their main priority is to put United on a more stable and sustainable financial footing, and it wouldn’t be a particularly credible start to that endeavour if they were to grossly overpay for an asset that is currently drowning in debt, particularly at a time when the future remains so uncertain. Although it served a purpose initially, particularly for MUST, they did find the media interest became unhelpful to the process and that is why they’ve taken the decision to pursue matters more privately. What is for certain is that it wasn't due to a lack of collective wealth between all those who formed the Red Knights Group. Between them they could buy United many times over and some of them could do so alone.

The Glazers (via high interest loans) paid £800m for United in 2005, having effectively bid against themselves by buying small chunks of shares and thus increasing the price due to takeover speculation. The market said United was worth £1 a share prior to their interest but they ended up paying three times that price which is why we find ourselves in the situation we do now.

At the time, we had just invested heavily in the squad and had players like Wayne Rooney, Rio Ferdinand and Cristiano Ronaldo poised to make their mark on the team. We had also begun work on expanding the quadrants at Old Trafford too. Now, more than five years on, the Glazers have reaped the benefit of that investment by the plc, whilst failing to invest any of their own money (not a penny - it has been one way traffic), and have hiked up ticket prices to breaking point. Not only this, but in their desperation for cashflow they have had to ‘front-end’ a number of the sponsorship deals.

Some of those involved in the Red Knights used to be senior figures within Old Trafford - including former directors, lawyers and plc investors - and they know the ins and outs of the business better than most and have continued to analyse it thoroughly throughout this whole campaign.

These are not in it primarily to make a profit for themselves - there are plenty of other more lucrative investments. But they do want United to make a profit, and they do want us to be able to pay down the debt, bring down ticket prices and invest in the squad. And the worst possible way to start doing that is to pay the Glazers any more than they have to.

It is important to understand that the “Red Knights” is not just a single fixed group of individuals. It is actually a term we have used since prior to the Glazer takeover to refer to friendly bidders who would come to the rescue of Manchester United. The make-up of any Red Knights consortium is therefore not set in stone and effectively it has over recent months included pretty much every individual and group who has expressed an interest in ownership of Manchester United, including a number who could alone buy the club outright and indeed are thought to have made bids in the past.

The Red Knights group remain firmly committed to the ultimate goal of realising our shared vision of a renewed and reinvigorated Manchester United - a business that’s sustainably financed, a community asset that rewards loyalty and one where supporters are put at the heart of everything the club does.

So, either the Glazers will get real about a fair and reasonable valuation - and the fans will have an important role to play in continuing to put pressure on them so that they finally see sense - or the business will show itself capable of coping with the many challenges going forwards and the Red Knights will consider that the price on offer is a fair and sustainable one.

We’ll continue our collaboration and discussions with the Red Knights and keep everyone as informed as we possibly can as the situation develops but there is likely to be little news on that front now until a significant development occurs. We have to be patient and go about our business (continuing to build membership) while they go about theirs.

Have you read these items too?

[1] The Red Knights - update

[2] Green & Gold - New Season. Same Goal

[3] United We Stand - Divided We Fall