The Glazer family, the American owners of U.K. soccer team Manchester United, reportedly will use cash from the team to reduce hedge-fund debts that helped pay for the family’s 2005 acquisition of the club,
according to Bloomberg News.
The Glazer family is trying to raise 500 million pounds ($816 million) in a bond issue, and plan to wait before using 70 million pounds to pay their debts to avoid negative publicity…. United fans have expressed concern with the club’s finances and its ability to sign new players since the Glazers’ 790 million pound takeover.
The Glazers funded the acquisition of the team via senior debt, hedge-fund debt and equity, Bloomberg reported. Senior debt of about 500 million pounds was leveraged against the club, but the family was responsible for repaying the 138-million-pound hedge-fund loan, now a 202-million-pound liability because of a 14.25% interest rate, the Bloomberg article said.
“This whole exercise in terms of the bond issue is not about United’s finances, it’s about the family looking out for its own interests,” said Duncan Drasdo of Manchester United Supporters Trust, a group that’s campaigned against the Glazers since their buyout.
(Source: Bloomberg News, Jan. 15, 2010.)
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