Manchester United plc announced Sunday that it has entered into an agreement under which British billionaire Jim Ratcliffe, chairman of INEOS, will acquire 25 per cent of Manchester United’s Class B shares and up to 25 per cent of Manchester United’s Class A shares for $1.3 billion and provide an additional $300 million intended to enable future investment into Old Trafford.
As part of the transaction, INEOS has accepted a request by the board to be delegated responsibility for the management of the club’s football operations. This will include all aspects of the men’s and women’s football operations and academies, alongside two seats on the Manchester United PLC board and the Manchester United Football Club boards.
The deal values the the club at about $5.4bn, falling below initial hopes US owners the Glazer family of $6 billion. The transaction will be fully funded by Trawlers Limited (wholly-owned by Ratcliffe) without any debt.
The decision from the Glazers to keep a controlling stake in the club will almost certainly anger fans, who have protested for years to oust the unpopular owners.
The stated joint ambition is to create a world-class football operation building on the Club’s many existing strengths, including the successful off-pitch performance that it continues to enjoy.
Ratcliffe said: “As a local boy and a lifelong supporter of the Club, I am very pleased that we have been able to agree a deal with the Manchester United Board that delegates us management responsibility of the football operations of the Club. Whilst the commercial success of the Club has ensured there have always been available funds to win trophies at the highest level, this potential has not been fully unlocked in recent times. We will bring the global knowledge, expertise and talent from the wider INEOS Sport group to help drive further improvement at the Club, while also providing funds intended to enable future investment into Old Trafford.
“We are here for the long term and recognise that a lot of challenges and hard work lie ahead, which we will approach with rigour, professionalism and passion. We are committed to working with everyone at the Club – the Board, staff, players and fans – to help drive the Club forward.
“Our shared ambition is clear: we all want to see Manchester United back where we belong, at the very top of English, European and world football.”
The transaction is subject to customary regulatory approvals and all parties are hopeful it will be completed as soon as possible.
The Board of Directors of Manchester United plc has approved the transaction and recommended that the Manchester United plc shareholders tender their shares in the tender offer and approve the change to the Articles of Association of Manchester United plc to, among other things, permit the transfer of Class B shares.
The closing of the tender offer will be subject to the receipt of Premier League approval and other necessary regulatory approvals, shareholder approval of an amendment to the Articles of Association and other customary conditions.
Trawlers Limited is a company incorporated under the laws of Isle of Man and is wholly-owned by Sir Jim Ratcliffe.
Trawlers Limited was advised by Slaughter and May, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Goldman Sachs International and J.P. Morgan Cazenove. Manchester United was advised by The Raine Group and Latham & Watkins LLP. The Glazer family shareholders were advised by Rothschild and Co.
Deal Highlights
– Acquisition of 25% of the Class B shares held by the Glazer family
– Offer to acquire up to 25% of all Class A shares
– The Glazer family and Class A shareholders will receive the same price of $33.00 per share
– Further investment of $300 million in the Club
– INEOS delegated responsibility for management of football operations
– Completion of this deal is subject to receiving all necessary regulatory approvals including from the Premier League
