24th November 2022


24th November 2022

(In tribute to the late Wilko Johnson)

The news that the Glazer family were exploring a possible sale of Manchester United has understandably sent the world’s media into a bit of a frenzy. Speculation and valuations abound. And yes, it is not often that the most famous club in English football comes up for sale. But along with Liverpool, two Big 6 Premier League clubs up for sale at the same time warrants further examination.

We looked at some of FSG’s possible motivations for selling up in our last blog. Now that there are two US owners looking to leave the Premier League, our own thoughts on those possible motivations would appear to hold even more water than before.

Those of you who are familiar with our work will know that the Premier League clubs do not achieve economic profits to any large degree. Indeed, since 2010, Liverpool has achieved 4 economic profits in 11 years whereas Manchester United has achieved just one single economic profit in 2012-13. This was also Sir Alex Ferguson’s and David Gill’s (Chief Executive) last season with the club. Consequently, Manchester United’s underperforming share price has reflected the lack of profits and the financially painful descent towards a club record economic loss of £145m in 2021-22.

Undoubtedly, Covid has been a factor but not the instigator of poor economic performance. The majority of Premier League football clubs were achieving significant losses despite record revenues up to and including the 2018-19 season.

Thus, on a day to day basis, football is not the profit-achieving enterprise that we are led to believe it to be by those in close association with the administration of the game. For club owners, this presented something of a problem. To the American owners steeped in sports business, it presented a challenge. How to turn a profit from a traditionally philanthropic and loss-making enterprise? Without merger and acquisitional activity, there are only two routes that could deliver profits in a dysfunctional financial environment: operational or structural reform. They chose structural reform. Thus, Project Big Picture and Super League were born.

Both initiatives failed. Both were heavily supported by FSG and the Glazer family. Both owners are now attempting to sell their interests in English football.

For the Premier League, this, we believe, is a pivotal moment. Two of the biggest clubs in the division are for sale. The new owners, whoever they may be, could pay a combined £10bn+ to complete both transactions. You would think that the Premier League’s administrators would be jumping for joy at the value-creation achieved by such prices for its own shareholder clubs. However, we suspect that there may be very serious trouble ahead.

Even if Liverpool is sold for, say £3.5bn, and Manchester United sold for, say £6.5bn, the challenge for the Premier League is whether the current format can deliver returns on such enormous acquisition prices.

And this brings us right back to the issue of Super League and the potential it offers in terms of future profit. The new owners, and we include Chelsea in this, may well resurrect the concept simply because playing local league football does not provide the returns to justify the initial acquisition price. Indeed, because there is increasing competition for the currently and limited lucrative Champions League places with two of the main contenders being state-backed entities, the investment risk is abundantly clear. The Glazers have found this out to their cost with an operational cost base geared for Champions League participation but increasingly failing to qualify for it. Arsenal is another example.

We do acknowledge that there is growth to be had within the women’s game but again, it requires significant ongoing investment.

Investors do not like risk when it is weighted against them. Sure, there are opportunities and buying into two of Europe’s biggest clubs cannot be ignored but the burden of acquisition will weigh heavily in terms of how the future of football will be shaped and as we’ve said plenty of times before, the Premier League isn’t ‘it’.


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