Manchester United is one of the most popular professional football clubs in England's Premier League. The team has won more trophies than any other team in English football, including a record 20 League titles. However, the takeover of Manchester United by the Glazer family beginning in 2003 saddled the historic club with substantial amounts of debt, which is a source of continuing controversy for many long-time supporters of the club.

The Glazers' Ownership of Manchester United

Malcolm Irving Glazer built his wealth through real estate investing, including mobile home parks and shopping centers. The Glazers also own the Tampa Bay Buccaneers of the National Football League (NFL).

The Glazers began purchasing their shares in Manchester United in 2003 through a holding company known as Red Football, starting off with a small 3.17% stake in the team. Little by little, the Glazers increased their ownership of the football club by acquiring other shareholders' portions.

By May 2005, the Glazers had achieved more than a 75% controlling interest in the club. With its control, Malcolm Glazer was able to get Manchester United delisted from the London Stock Exchange. He then quickly gained 98% of its shares, and finally acquired the last 2% to gain full ownership of the football club. Ultimately, Malcolm Irving Glazer paid around £790 million for the team.

A Brief History of Manchester United Debt

As part of the takeover, the Glazers saddled the club with a large amount of debt. Around £265 million was secured by the club's assets, with the total amount of debt around £660 million.

This was the first time the club had debt since 1931. The loans were provided by large American hedge funds, with interest rates on the debt amounting to approximately £62 million a year. A substantial portion of the loans were payment in-kind loans, which the club was paying 16.25% interest on at one point. The precarious nature of the club's balance sheet led to protests by the club's supporters.

At one point in 2010, the club's debt exceeded £716.5 million, prompting an outcry from the club's supporters. The Glazers refinanced this debt in 2010 by issuing a series of bonds with two main tranches. The first tranche, worth about £250 million, paid interest around 8.75%. The second tranche, worth around $425 million, paid 8.375% in interest. The second tranche was issued as a result of high investor demand in the United States. The funds from the bond offerings were used to pay down outstanding debt over the next few years.

In 2012, Manchester United had an IPO on the New York Stock Exchange (NYSE). Shares were offered at $14, offering around 16 million shares for sale. Class A shares were offered to the public, while Class B shares were controlled by the Glazers. The classes were structured so that the Glazers maintained voting control of the club, which some viewed as controversial. George Soros, the famed investor, was a major purchaser of Class A shares during the IPO. Money from the IPO was used to pay around £62 million in bonds, decreasing the club's debt load.

In Manchester United's latest financial report in the fall of 2019, the club's debt had risen to £511.2 million pounds.