SOURCE: THE BALL IN CONFUSION
http://marcoliguori.blogspot.com/2010/02/manchester-united-obbligazioni-per.html
Tuesday, February 23, 2010
Manchester United: obligations to resolve debt of 820 million
The "Red Football Shareholder Limited, a holding company that controls the company of English football, has issued a loan of 500 million pounds for savers: they are placed JP Morgan, Bank of America, Merrill Lynch , Deutsche Bank, Goldman Sachs International, Royal Bank of Scotland and KKR
reading for the year to June 30, 2009 the group that controls the football club Professional Manchester United, headed by the holding company Red Football Shareholder Limited, positive data emerge as the increase in turnover and the presence of an operating profit with an EBIT (earnings before taxes) of 90 million pounds (about 103 million euro), while as a loss immediately struck by the huge net financial debt amounted to 716.6 million pounds (about 819 million euro), with its enormous weight in terms of financial burdens, Additionally, it also raises a concern for the lending of £ 10 million granted to the Glazer family. On closer analysis it is clear that the presence of net income is due to capital gains the sale of rights to benefits of sports players, including that relating to the sale of Cristiano Ronaldo to Real Madrid, which has partially mitigated the debt, generating an explosive increase in cash.
The sale of Cristiano Ronaldo is an operation that can compare to what he does when a family decides to pay his debts, or resort to selling the "family jewels". In this case would have been two other "jewels": Rooney and the stadium Old Trafford. " The solution to the problem found Glazer the enormous debt was to pay the banks with the money of savers, who return to our memories untoward events related to financial homegrown, a sign that the financial world nothing is created, but everything changes. In summary, the Glazer family has asked banks to borrow money to buy Manchester United, he transferred his debt to the club, plus it has asked the club to borrow money to allocate to its members, and now asks to borrow money savers . Unfortunately, this family is to manage a club, which according to a survey conducted in 2007 by TNS Sport, the world can count 133 million fans and 333 million sympathizers and / or interest in the affairs of the club.
When reading the data we have considered a rate of 1 € EUR £ 0.8743.
BALANCE SHEET The consolidated balance sheet June 30, 2009, shows assets for 752,677 thousand pounds (860.8 million euro), a working capital to 204,959 thousand pounds (234.4 million euro), consolidated liabilities and liabilities for a total of 917,344 thousand pounds (1.0492 billion euro) and equity for 40,292 thousand pounds (46 million euro). The Consolidated Balance Sheet at 30 June 2008 at a glance showed fixed assets of 774,976 thousand pounds (886.3 million euro), a working capital for thousands of pounds 102,975 (€ 117.7 million), liabilities Long-term and short- for a total of 841,862 thousand pounds (962.8 million euro) and equity for 36,089 thousand pounds (41.2 million euro). From 30/06/2008 to 30/06/2009
liabilities, both short and long term loans, rose by about 75 million pounds (about +8.97%). As at 30 June 2008, the liabilities in the medium to long accounted for 83% of debt at June 30, 2009, but increases the incidence of the liabilities that the debt go from 17% to 20% of total debts, signal deadlines are approaching.
Among the intangible assets has always displayed a substantial goodwill amounting to 386,065 thousand pounds (441.5 million euro) in 2008 amounted to 421,453 thousand pounds (482 million euro). Goodwill exposed is due to the difference between valuation at "fair value" and the value of purchase of subsidiaries. This difference is amortized over 15 years and the gross value at which it was calculated the depreciation amounts to 530,822 thousand pounds (607 million euro), and the related accumulated depreciation as of June 30, 2009 reached the figure of 144,757 thousand pounds (165.5 million euro).
Intangible assets relating to the net amount players rose to about 113,406 thousand pounds (about 129.7 million euro) in 2008 amounted to 92,739 thousand pounds sterling (about € 106 million), an increase of 22.29 %. At 30/06/2009, the historical cost of the Rose players turns out to be £ 222.3 million (2008: 201.4) the value of the related accumulated depreciation amounts to £ 108.9 million (2008: 108.7). Been invested in the players rose to 61,802 thousand pounds (70.6 million euro) and mobilized players who had a historical cost thousands of pounds to 40,908 (46, 7 million euro).
Tangible assets amounted to 253,206 thousand pounds (289.6 million euro) in 2008 amounted to 260,784 thousand pounds.
receivables within one year are exposed to 41,500 thousand pounds (47.4 million euro) in 2008 were 42,487 thousand pounds, those with longer duration exercise amounted to approximately 12,650 thousand pounds (about 14.4 million euro) in 2008 were 10,460 thousand pounds.
Among the claims are included those owed to other clubs for the transfer of players, which amounted to 10.293 thousand pounds (11.7 million euro).
Other long-term receivables show a credit for 10 million pounds (11.4 million euro) in relation to "directors". In the explanatory note of the budget, specifically that concerning relations with related parties, specifying that the group that controls the Manchester United has made a loan of 10 million pounds to six members of the Glazer family (1,667 thousand pounds each). This amount is not due for at least 5 years and earn interest at 5.5% per year.
Cash and cash equivalents amounted to approximately 150,530 thousand pounds in 2008 were 49,745 thousand pounds, scored an explosive increase of 100.7 million pounds (115.2 million euro) over the previous year. This explosion is due to the cash payment of Cristiano Ronaldo, which was funded by English banks.
the liabilities are established, an increase of 2.38%, the debt with longer duration exercise for a total of 712,136 thousand pounds (814.5 million euro) in 2008 was 695,566 thousand pounds ( 795.5 million euro). These debts include bank loans privileged Long-term 499,649 thousand pounds (511,630 thousand pounds in 2008), a mezzanine debt (loan payment in kind ") to 202,094 thousand pounds ($ 175,787 thousand pounds in 2008), other financial debt for 5 million pounds ; trade payables 4,209 thousand pounds, other debt security for thousands of pounds 1,184.
Among the liabilities, debts due in less exercise increased from 72,186 thousand pounds in 2008 (82.5 million euro) 74,412 thousand pounds in 2009 (EUR 85.1 million), an increase of 3.08%. This option is the debt falls for the acquisition of players amounting to 28.9 million pounds (21.7 million pounds in 2008). The article about the deferred revenue for anticipated an increase of 54.83% from 72,424 thousand pounds (82.8 million euro) 112,137 thousand pounds (128.2 million euro). In particular, the anticipated revenues for commercial activities (sponsorship) spend thousands of pounds from 13,456 to 57,579 thousand pounds.
INCOME The income statement at 30 June 2009 shows a turnover, up 8, 68%, amounting to 278,476 thousand pounds (318.5 million euro), in fact, to June 30, 2008 showed a turnover (excluding joint ventures) amounted to 256,239 thousand pounds (about 293 million euro). The composition of
sales, in thousands of pounds, is as follows:
- Revenues from 108,799 races (101.468 in 2008), with an incidence of 39.07% of the total (39.62% in 2008), an increase of 7.22% ;
- Medium Income from 99,735 (90,723 in 2008), with an incidence of 35.81% of the total (35.4% in 2008), an increase of 9.93%;
- Revenues from operating activities for 69,942 (64,048 in 2008), with an incidence of 25.12% (24.98% in 2008), an increase of 9.20%. Since June 2010, Aon Corporation (Aon) happen to AIG as a sponsor with a contract expiring at the end of season 2013/14.
The total operating expenses is an increase of 5.41% and amounted to 269,126 thousand pounds (307.8 million euro) in 2008 amounted to 255,313 thousand pounds (about 292 million euro). Among the items of operating expenditure with a higher incidence, as it is obvious, since the football budgets, we find the cost of staff. The cost of staff, June 30, 2009, amounted to 123,120 thousands of pounds equal to 44.21% of sales in 2008 amounted to 121,080 that cost thousands of pounds (138.4 million euro), with a percentage turnover of 45.75%. Another major item of operating expenditure consists of the amortization of the players rose to 37,641 thousand pounds (43 million euro) in 2008 amounted to 35,481 thousand pounds (40.5 million euro). Amortisation of goodwill is exposed to 35,388 thousand pounds (40.4 million euro) in 2008 amounted to 35,258 thousand pounds (40.3 million euro), while the depreciation on fixed assets is shown to 8875 thousands of pounds (10.1 million euro) in 2008 amounted to 8,720 thousand pounds (9.9 million euro). At 30 June 2009, the group's workforce is made up of 591 units including 62 players, 30 June 2008, however, was composed of 544 units including 68 players.
Staff costs and depreciation account for approximately 76.18% of total operating expenses.
The excess of capital gains on transfer of players' contracts amounted to 80,724 thousand pounds (92.3 million euro) in 2008 was 21,831 thousand pounds (around 24.9 million euro).
EBIT, ie net income before interest and taxes was a profit of 90,074 thousand pounds (103 million euro) in 2008 were positive for thousands of 24,059 pounds ($ 27.5 million € ), an increase mainly due to capital gains.
Net financial expenses amounted to 68,504 thousand pounds (around 78.3 million euro) in 2008 amounted to 68,839 thousand pounds (around 78.7 million euro).
The result for the year is positive thousands of pounds for 6341 (EUR 7.2 million), while the June 30, 2008 was a loss of 42,966 thousand pounds (around 49.1 million euro).
DEBT GROUP
The financial position as at 30 June 2009 shows a net debt of approximately 716,586 thousand pounds (about 819.6 million euro) increased by 2.49% compared to 699,174 thousands of pounds in the previous year (about 799.5 million euro).
preferential bank loans totaled 509.492 million pounds (582.7 million euro), down 1, 77% compared to 518,695,000 pounds ($ 593.2 million Euros) in 2008. These loans include capitalized borrowing costs. Among the privileged
bank loans, 501,707,000 pounds (about € 567 million) relate to the debt issued by Red Football Limited, for the acquisition of Manchester United. This debt involves incurring a financial burden with an interest rate based on Libor plus a margin ranging between 2.125% and 5.00%. Under an agreement dated 16 August 2006, two subsidiaries of Manchester United and Manchester United Football Club Limited Limited yet secured debt to the tune of 557 million pounds. With regard to maturity are deadlines ranging from 2013 to 2016. Among the privileged bank
presititi addition, we also find a bank loan of 7,785,000 pounds contract with The Royal Bank of Scotland plc and headed Alderley Urban Investments Limited, a subsidiary of Manchester United Limited. This loan relates to a contract that provides for the application of the interest rate Libor plus 1%. 3,586,000 of these loans are repayable in quarterly installments through July 2018 and the balance of £ 4,199,000 to be repaid July 9, 2018.
addition there is a preferential bank loans unsecured loan in the amount of 5,000,000 pounds, the contract for the minority stake in MUTV (Manchester United, a subsidiary of Limited). The mezzanine debt contract on August 16, 2006, in the form of PIK, a problem. At June 30, 2009, it grew to 202.094 million pounds, while the June 30, 2008 was 175,479,000 pounds. This increase occurred due to the capitalization of interest that have accrued at a fixed rate to the extent of 14.25% per annum. The expected duration of the loan is 11 years from August 16, 2006. This debt relates Red Football Joint Venture Limited.
THE SOLUTION: The bond issue
The solution to the problem of the enormous debt caused by the acquisition of the club, was found by Glazer (or the banks?) In the transfer of debt by banks to savers. As history teaches us, without the help of the banks are unable to place between individual investors bonds. From the prospectus relating to the bond, it is stated that the banks involved in the transaction are: JP Morgan, Bank of America, Merrill Lynch, Deutsche Bank, Goldman Sachs International, Royal Bank of Scotland and KKR.
The amount of the issue is 500,000,000 pounds. The issue is both in dollars and in sterling due 2017. As a broadcaster has chosen to create a new society MU Finance Plc, established November 26, 2009, with headquarters at the Old Trafford. Guarantors of the loan are to be Red Football Limited (sub-group holding company) and its subsidiaries: Junior Red Football Limited, Manchester United Limited and Manchester United Football Club Limited. In the statement specified that the bonds will be guaranteed "substantially" with all the assets of the guarantors.
The 500 million bond issue, together with £ 30 million of existing cash, will be used as follows: 507 million pounds will be used to pay existing debt, for 8 million and 15 million interest payment to pay the cost placement. Luca Marotta
jstargio@gmail.com
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