Football

United confirm debt date

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The first chunk of the major debt on Manchester United needs to be repaid by June 2013.

Although the results posted by Red Football confirmed record turnover and record profits, it was impossible to look at the figures without being drawn to the eye-watering £649.4million, the overall debt figure for United and its associated companies.

The bulk of this is the £510.69million taken out against the football club itself. And for the first time, it has been confirmed exactly when the money is due to be paid back.

Four major loans have been taken out, all dating back to the last refinancing deal on August 16, 2006, which must be paid back within seven and 10 years.

So, starting from June 2013, substantial sums, way beyond the £45.5million currently coming out of United's profits to make interest repayments, must be found by the Glazer family.

Further refinancing cannot be ruled out, although in the current financial climate, it is difficult to see any lender willing to take on such an undertaking.

The Glazers have never given any indication as to how they intend to pay the loans back. However, neither have they shown any sign of being too concerned about the debt mountain itself.

Indeed, as a stand-alone business, United can be delighted at their present performance.

Accounts to June 2008 reveal turnover at the Premier League and European Cup winners has risen an incredible 22% to £256.2million, underpinning a 7.5% increase in profits to £80.4million.

And, while wage costs have risen substantially following the arrivals of Owen Hargreaves, Carlos Tevez, Anderson and Nani, plus improved contracts for the likes of Cristiano Ronaldo, they are still well under 50% of turnover which is widely viewed in financial circles as the barometer for a well-run football club.

Copyright (c) PA Sport 2009, All Rights Reserved.

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Topics:
Football
Carlos Tevez
Premier League
Manchester United
Cristiano Ronaldo
Nani
Owen Hargreaves
Anderson

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