{"id":93401,"date":"2025-08-19T03:31:41","date_gmt":"2025-08-19T03:31:41","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/93401\/"},"modified":"2025-08-19T03:31:41","modified_gmt":"2025-08-19T03:31:41","slug":"inside-the-clause-the-glazers-can-now-trigger-to-drag-ineos-into-full-man-united-takeover","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/93401\/","title":{"rendered":"Inside the clause the Glazers can now trigger to drag Ineos into full Man United takeover"},"content":{"rendered":"\n

Since the Glazers sold 27.7 per cent of Manchester United in February 2024, discussion of the \u2018drag-along\u2019 rights that could compel Sir Jim Ratcliffe to relinquish have been confined to whispers.<\/p>\n

The issue of the binding agreement, which is detailed in United\u2019s own SEC filings, has understandably been lost in the broader, more emotionally-charged conversation about the club\u2019s atrophy on the pitch, its personnel overhaul, and \u2013 in the last few weeks, at least \u2013 its retail therapy in the transfer market.<\/p>\n

We\u2019re used to throwing around big numbers in football, the latest being the \u00a366.5m-plus paid to bring Benjamin Sesko to Old Trafford,<\/a> whose transfer fee would have been dwarfed by the \u00a3120m at which Brighton were understood to have valued Carlos Baleba. <\/p>\n

The South Coast club have now insisted the midfielder is staying put, but even without him, United have spent north of \u00a3200m<\/a> this summer with no fees recouped from sales.<\/p>\n

PlayerFromFeeBenjamin \u0160e\u0161koRB Leipzig\u00a366.5m + \u00a37.4m add-onsBryan MbeumoBrentford\u00a365m + \u00a36m add-onsMatheus CunhaWolves\u00a362.5mDiego Le\u00f3nCerro Porte\u00f1o\u00a33.2m + \u00a33.8m add-onsEnzo Kana-BiyikLe HavreFreeManchester United\u2019s 2025 summer signings so far<\/p>\n

But the most stupefying numbers? They\u2019re reserved for conversations between the owners. <\/p>\n

Most analyses value Manchester United at close to \u00a35bn<\/a>, twice the world-record figure Todd Boehly and Clearlake Capital paid for Chelsea.<\/p>\n

In United\u2019s case, there is a handy barometer in the initial \u00a31bn Ineos<\/a> committed to pay for just over a quarter of the club 18 months ago. <\/p>\n

Their total stake is now 29 per cent, following a further \u00a3237m investment in December last year. <\/p>\n

And as of the beginning of August, a clause is active that could effectively force Sir Jim Ratcliffe<\/a> to sell the entirety of that stake as part of a full takeover of the club.<\/p>\n

\"DiagramManchester United ownership diagram<\/p>\n

Credit: Adam Williams \/ United in Focus \/ GRV Media<\/p>\n

If the six Glazer<\/a> siblings accepted an offer above $33 per share for outright control of United \u2013 whether from a sheikh, a private equity titan, or anyone else the Premier League deems fit and proper \u2013 then Ratcliffe would have no choice. He would be legally obliged to sell.<\/p>\n

We know that majority ownership regime is open to a full sale. When they announced in November 2022 that they were \u201ccommencing a process to explore strategic alternatives\u201d, they weren\u2019t just stress-testing their valuation.<\/p>\n

The dividend well had dried up, the European Super League gravy train had come off the rails, and the inferno of hatred from Man United fans<\/a> would make even the thickest-skinned investor\u2019s blood run cold. They wanted out \u2013 but at a price that suited them.<\/p>\n

\"JoelPhoto by Michael Regan\/Getty Images<\/p>\n

The problem was that no would-be buyer presented a big enough number. Sheikh Jassim\u2019s bid was close to \u00a35bn<\/a>, but the Qatari banker failed to provide sufficient proof of funds. Football clubs have simultaneously become so expensive and so revenue-negative that, for a superpower like Manchester United, the market is very, very thin.<\/p>\n

But that may not always be the case. Reportedly, the Glazers appraisal of United is closer to \u00a36bn. So, if a buyer ever came to the table with kind of offer, what is stopping them from selling?<\/p>\n

The Glazers\u2019 drag-along rights explained<\/p>\n

The \u2018drag-along rights\u2019 are detailed in the related-party transactions section of United\u2019s last annual report.<\/p>\n

\u201cIn the investment agreement, the drag-along rights are in existence for as long as the Glazers family are the majority shareholder,\u201d explains Jamie Bajwa, former equity research analyst for Goldman Sachs and chief financial officer at Velocity Black, speaking exclusively to UIF.<\/p>\n

\u201cBasically, 18 months after the closing date of Sir Jim Ratcliffe\u2019s investment, the Glazers have the ability to force all other shareholders \u2013 including INEOS \u2013 to sell their shares.<\/p>\n

\u201cNow, the conditions upon that are that it can only be invoked if the board, which includes Ineos appointed representatives, votes in favour of a full sale, and they must notify Ineos of the material conditions of the sale.<\/p>\n

\"SirPhoto by Ash Donelon\/Manchester United via Getty Images<\/p>\n

\u201cThe other element, which is an important point to note, is that if it is in this three-year holding period where INEOS effectively have full day-to-day operational control, there is a minimum price which any buyer needs to pay. That\u2019s $33 per share. That was Sir Jim\u2019s entry point. So, he would effectively get his money back, minus the \u00a3300m or so he has injected.<\/p>\n

\u201cThe reality of how the \u2018material conditions\u2019 detailed in the agreement would work is that, if there was an offer that the board approved of, that is when this would start to come into play and INEOS would get a heads-up that it was coming.<\/p>\n

\u201cThe board, who are responsible for the long-term health of the club, would say \u2018we\u2019re approving this deal and given that the majority shareholders are also in favour of it, we are invoking our right to force you to sell your shares.\u2019 Ratcliffe wouldn\u2019t lose out on the money he has paid for his shares.<\/p>\n

\u201cThe makeup of the board is you have the six Glazers, two Ineos representatives, and two non-executives. Ineos and the Glazers have the right to appoint members. The only reason to change the board structure would be if there was a change in the ownership structure first.\u201d<\/p>\n

The Glazer family\u2019s motives for Man United auction process<\/p>\n

There is no indication that the Glazer family are actively courting offers for the asset they bought via a leveraged buyout in 2005, but the very fact that they put United up for sale in 2022 suggests they would at least consider any viable proposals they receive.<\/p>\n

\u201cIt depends on the Glazers\u2019 motives, and we don\u2019t know them for certain,\u201d says Bajwa, who is a United supporter and writes regularly about the club\u2019s finances via his Sub-Prime Goals alias.<\/p>\n

\u201cThere are a few things to note here. The reality is that the Glazers have not been successful operators of Man United. During the early days, they were very successful at optimising the commercial aspect. But, as they have wasted hundreds of millions of pounds on the pitch, results have slipped.<\/p>\n

\u201cEven the commercial side of the business has now slowed down. It has grown at two per cent per annum since 2016. That is significantly below sports sponsorship market inflation. So, them initially sounding out investment, in my eyes, probably indicates a few things\u2026<\/p>\n

\"ChartMan United commercial income vs Big Six graph<\/p>\n

Credit: Adam Williams\/United in Focus\/GRV Media<\/p>\n

\u201cThey wanted to understand the valuation they could get and therefore the cash they could get, which could then be redirected to other business endeavours.<\/p>\n

\u201cThey listened to offers of a full sale. Linking to cash, debt may have also become more difficult to get given the financial position of the business too.\u201d<\/p>\n

United\u2019s current enterprise valuation \u2013 how much could the Glazers or Ineos get?<\/p>\n

Football club values at the elite end only trend one way on a graph: up and to the right.<\/p>\n

United\u2019s growth has been somewhat slower in recent years, however. UIF recently spoke with Brand Finance, for example, who said that United\u2019s brand has been devalued by \u00a3172m<\/a> over the last year and their enterprise value is, by their methodology, around \u00a33.2bn.<\/p>\n

Other analysis from the likes of Forbes, Football Benchmark, Sportico et al are a little more bullish, but the general consensus is of a club whose value is not where it should be given the head start they have had over all but a handful of teams in world football.<\/p>\n

\u201cWe don\u2019t know if the valuation expectation has stayed the same,\u201d says Bajwa. <\/p>\n

\u201cOn one hand United are adjusting their cost structure and recent deals in the sports industry show significant valuations, but results on the pitch are yet to improve \u2013 and that will be the biggest mover on United\u2019s valuation.<\/p>\n

\u201cBut then, if you look at it from an investor perspective, I would question whether the number of prospective buyers for Man United has actually increased. They didn\u2019t qualify for the Champions League, they are still in the process of restructuring the men\u2019s first-team wage bill, and by the looks of it they may have taken on more debt to fund the latest transfer spend.<\/p>\n

\"ChartManchester United gross debt 2024-25<\/p>\n

Credit: Adam Williams\/United in Focus\/GRV Media<\/p>\n

\u201cSo, while some difficult decisions have been made, a new buyer would still have to do a lot of the work to actually realise some value. You still have to pay the same price that Sir Jim paid and you\u2019d potentially have to go through another round of senior leadership upheaval because the current team have been hired by Ineos.<\/p>\n

\u201cAs an asset owner, you are going to extract the maximum value you can. The Glazers own one of the biggest sports brands in the world, so they are going to hold out for the highest price they possibly can.<\/p>\n

\u201cBearing all of those things in mind, I think if the Glazers wanted to sell and they got their price, they probably would. The question is: would an investor be willing to pay a higher price now given the current situation and the work that still has to happen?<\/p>\n

Sir Jim Ratcliffe\u2019s first right of refusal<\/p>\n

\u201cBoth sides have a right of first offer to purchase Class B shares before they are sold to any third party,\u201d Bajwa explains, discussing the intricacies of the drag-along rights.<\/p>\n

United\u2019s corporate structure is such that the Class B shares, which are owned by Ratcliffe and the Glazers, command far greater voting power than the Class A shares, which are those sold on the New York Stock Exchange and owned by investment groups such as Lindsell Train and Ariel Investments, as well as private investors.<\/p>\n

Lindsell Train UK Fund \u2013 June Update<\/p>\n

‘We\u2019d say that Burberry, Fever-Tree and Manchester United are all examples of a rare type of company. They are British brands or franchises with global recognition and globally derived revenues. They are also, in our opinion, highly likely to\u2026 pic.twitter.com\/AOvCaWniC4<\/a><\/p>\n

\u2014 MastersInvest.com (@mastersinvest) July 11, 2025<\/a> <\/p>\n

View Tweet<\/p>\n

\u201cThat clause is active unless the Glazers and Ineos are transferring shares between each other, or a permitted transferee \u2013 another family member, for example.<\/p>\n

\u201cIn the case of the Glazers, the transfer would be part of a full sale that meets the required conditions.<\/p>\n

And in the case of Ineos, they don\u2019t have to give the Glazers the right of first offer [to sell their own shares] if they remain the majority shareholder or if it is after the three-year operating partner window.\u201d<\/p>\n

Does Ratcliffe have the cash for a full takeover himself?<\/p>\n

Naturally, Ratcliffe\u2019s finances have been scrutinised heavily since he became United\u2019s single largest individual shareholder. <\/p>\n

Ineos, the main source of his wealth, have cut back significantly on sponsorship and are reportedly looking to sell OGC Nice<\/a>, their investment in French football. <\/p>\n

Their credit rating has also been downgraded by several agencies, and delays to the opening of a new plant in Antwerp are said to have impacted cashflow. They will have also taken a financial hit after being forced to recall 7,000 of their electric 4\u00d74 vehicle, the Grenadier.<\/p>\n

So, Ratcliffe has the right to match any offer the Glazers receive, but does he have the resources?<\/p>\n

Bajwa says: \u201cThere are two people who properly understand Ratcliffe\u2019s wealth liquidity \u2013 and that\u2019s Sir Jim Ratcliffe and his wealth advisor.<\/p>\n

NameRank in top 500 richest peopleNet worthClub(s)Abu Dhabi sovereign wealth\u2013$1tnManchester CitySaudi Public Investment Fund\u2013$930bnNewcastle UnitedQatar sovereign wealth\u2013$525bnPSG, BragaBernard Arnault4$189bnParis FCMark Mateschitz80$23.4bnRed Bull clubsStan Kroenke85$22.8bnArsenal, Colorado RapidsPhilip Anschutz86$22.8bnLos Angeles GalaxyDavid Tepper87$22.4bnCharlotte FCFrancois Pinault90$22.1bnStade RennaisDietmar Hopp112$18.4bn1899 HoffenheimJim Ratcliffe200$12.4bnMan United, Nice, LausanneHansjoerg Wyss218$11.9bnChelsea, StrasbourgJosh Harris224$11.7bnCrystal PalaceSimon Reuben227$11.5bnNewcastle UnitedDavid Reuben228$11.5bnNewcastle UnitedDmitry Rybolovlev246$11.1bnAS MonacoMark Walter252$10.9bnChelsea, StrasbourgDan Friedkin253$10.9bnAS Roma, AS Cannes, EvertonShahid Khan307$9.33bnFulhamNassef Sawiris324$8.95BAston Villa, VitoriaDaniel Kretinsky402$7.69BWest Ham, Sparta PragueJoe Lewis405$7.66BTottenhamTodd Boehly426$7.28BChelsea FC, StrasbourgRichest private owners in football, sourced from Bloomberg Billionaires Index<\/p>\n

\u201cWhat I would say is that we know from the offer document is that Ratcliffe wanted the B shares, which are the ones with more voting power. They presented a deal structure which allowed either the Glazers to sell their shares to Ratcliffe in a staggered manner, so you can make an inference that, at the very least, he thought he would have the funds in a four or five-year time horizon to buy those shares. That, to me, suggests he wanted full control but he didn\u2019t have the funds available at the time that he thought he would in the future.<\/p>\n

\u201cIt would be odd to present an offer like this unless you assume operating control without taking on the full financial asset. There are clearly going to be questions about whether he can afford it.\u201d<\/p>\n

The role of United\u2019s NYSE minority shareholders<\/p>\n

The Glazers raised around \u00a3150m from their initial public offering of United Stock on the New York Stock Exchange back in 2012, having de-listed the company from the London Stock Exchange back in 2005.<\/p>\n

A by-product of that process is that United now must file quarterly financial reports, detailing their finances in far greater detail than every other Premier League club. The owners also now have a fiduciary duty to their retail and institutional shareholders. So what role might they play, if any, in a would-be takeover process?<\/p>\n

\"ManchesterPhoto Ben Hider\/Getty Images via NYSE Euronext<\/p>\n

\u201cSomething that came out in the offer document was there was a deal structure that the Glazers were happy with but which the board pushed back on,\u201d says Bajwa, \u201cbecause that would have broken SEC rules and risked litigation because of different prices being offered for different share classes.<\/p>\n

\u201cThe share price at the moment is about $17-18. If they got an offer of $33 or higher, in the current market, I don\u2019t think there would be many politics standing in the way. That\u2019s an incredible return. Close to a 100 per cent premium for any listed asset when it gets bought out is pretty good.\u201d<\/p>\n

How the European Super League affect the Glazers\u2019 business plan<\/p>\n

The Glazers\u2019 other major sports investment, the NFL side Tampa Bay Buccaneers, are a money-printing machine. Unlike United, the franchise league they operate in guarantees profits and dividends every year.<\/p>\n

The star-crossed European Super League which was launched and promptly collapsed in April 2021 was their attempt to replicate that model in football. The family was one of the driving forces behind the project.<\/p>\n

\u201cThe Glazers probably had to make a timeline change and maybe a downward revision on expectations,\u201d Bajwa explains when discussing how the Super League may have affected the Glazers\u2019 outlook.<\/p>\n

\u201cWith the Super League, we may not get the form that was originally presented, but the reality is that, with competitions like the Club World Cup and the expanded Champions League, we are moving to a place where the bigger teams are de-facto getting more share of revenue in an annuity style.<\/p>\n

\"ManchesterPhoto by Catherine Ivill\/Getty Images<\/p>\n

\u201cWhile the Super League isn\u2019t going to be there in full force, you are still getting some of the same financial benefits from it.<\/p>\n

\u201cThe timeframe you could fully \u2018monetise\u2019 Man United has been elongated and the best-case upside has come down a little, but you have still got to sort out the day-to-day operations and get the club functioning well. At that point, they can get a better price, but that\u2019s where the three-year time window that Ratcliffe has to get these funds together comes in. Those are the dynamics at play.\u201d<\/p>\n