American financial investor giant Carlyle is in talks for a major investment in Manchester United Football Club as the Premier League squad’s auction nears its closing stages.
Sky News has learned that Carlyle is among a handful of parties that have tabled proposals to acquire a minority stake the Old Trafford uniform.
Carlyle, which manages more than $370bn (£298bn) in assets, is among the largest private equity firms in the world.
In the UK, he has owned companies including RAC Breakdown Recovery Service and Addison Lee, Taxi Hire Group.
A source familiar with the situation said this weekend that Carlyle’s interest in Manchester United was “serious”, adding it had been under discussion for some time.
However, key details of Carlyle’s proposal, including how much capital it would seek to employ and the structure of a deal, have yet to be finalized.
Carlyle declined to comment.
Deadline set for final proposals
Carlyle’s interest emerged two weeks before the deadline set by Raine Group, the advisers who handle the sale process, for final proposals to buy or invest in Manchester United.
Sky News revealed exclusively last November the Glazer family’s plan to explore a strategic overhaul of the club its members have controlled since 2005, setting off a five-month battle to buy it.
Since then, dozens of parties are reported or rumored to have shown interest, though few have emerged as truly credible bidders.
The offer deadline of April 28 was set by The Raine Group, the investment bank that manages the sale, and which oversaw the £2.5bn takeover of Chelsea last year by a consortium led by Todd Boehly and Clearlake Capital.
The culmination of the process comes as United chase trophies in both FA Cups, with a semi-final against Brighton & Hove Albion next weekend and the second leg of their Europa League quarter-final against Sevilla to come, with a draw well balanced at 2-2.
In February, Red Devils 2-0 loss to Newcastle United in the Carabao Cup final they picked up their first trophy in six years.
Who is in contention?
The two sides that remain in contention to take over the Glazers altogether are Sheikh Jassim bin Hamad al-Thani, a Qatari businessman who chairs the Gulf state’s Qatar Islamic Bank; AND Ineos Sports, part of the petrochemical group owned by Sir Jim Ratcliffe.
Both reportedly submitted offers below a £6bn figure, which has been speculatively touted as the Glazers’ asking price for the club which they bought in 2005 for less than £800m.
In addition, several financial investors have shown interest in either becoming minority shareholders or providing some form of structured finance to the club to enable it to refurbish the outdated infrastructure of its Old Trafford home and Carrington training ground.
Among those who have presented minority investment proposals to Raine are Elliott Management, the American hedge fund that until recently owned AC Milan; Ares Management Corporation, a US-based alternative investment group; and Sixth Street, which recently bought a 25% stake in the long-term La Liga broadcasting rights to FC Barcelona.
At a valuation of £5bn – below the Glazers’ asking price – a sale of Manchester United would become the biggest sports club deal in history.
It would even eclipse the $6bn (£4.8bn) takeover of NFL team the Washington Commanders agreed this week by American private equity billionaire Josh Harris.
Part of the appeal of such a valuation lies in the potential future scrutiny of the club’s lucrative broadcasting rights, according to the bankers, coupled with a belief that arguably the world’s most famous sports brand could be more effectively commercialized.
Manchester United’s New York-listed shares closed nearly 5% down on Friday at $22.02, giving the club a market valuation of nearly $3.8bn (£3.1bn).
Glazer said to sell “without further delay”
This week, Manchester United’s largest supporters’ group, the Manchester United Supporters Trust (MUST), called for the auction to end “without further delay”.
“When it was announced in November that the Glazers were undertaking a ‘strategic review’ and inviting bids to buy the club, MUST welcomed the news and continued to urge majority owners to move forward with the process with speed, so that any period of uncertainty was as short as possible, he said in a statement.
“Nearly five months later, we are reading speculation that potential buyers’ offers remain below Glazers’ valuation and that a third round of offers will now be invited.
“With Erik ten Hag making such great progress in his first season, and with the important summer transfer window just weeks away, the news of these delays and the further prolonged uncertainty is a cause for great concern.”
The Glazers’ 18-year tenure has been dogged by controversy and protest, with the lack of a Premier League title since Sir Alex Ferguson’s retirement as manager in 2013 fueling fans’ anger at the debt-fueled nature of their takeover .
The fury over its participation in the ill-fated European Super League has crystallized fans’ desire for new owners to replace the Glazers, even if a sale to state-affiliated Middle Eastern investors wouldn’t – like the Saudi-led takeover of Newcastle United – fail. without controversy.
Confirming the launch of the strategic review in November, United co-executive chairmen Avram Glazer and Joel Glazer said: “Manchester United’s strength is built on the passion and loyalty of our global community of 1.1 billion fans. and followers.
“We will evaluate all options to ensure we best serve our fans and that Manchester United maximize the significant growth opportunities available to the club today and in the future.”
The Glazers listed a minority stake in the company in New York in 2012, but have retained overwhelming control through a dual-class shareholding structure, meaning they hold nearly all voting rights.
Over the past two years, the club has promised to introduce a modestly sized fan ownership scheme that would give shares to fans with the same voting rights structure as the Glazers.
The initiative, however, has yet to be launched despite the commitment to have it operational by the start of the 2021-22 season.
“Love United, Hate Glazers” became a familiar refrain during their tenure, with supporters critical of a perceived lack of investment in the club, even as the owners have taken huge dividends from its continued commercial success.