Why United deal took so long

United fans breathed a sigh of relief when Sir Jim Ratclliffe acquired a minority stake in the club from the Glazers, but the process was agonisingly long.

New documents posted this week with the Securities and Exchange Commission in the US shed some light over how the Manchester United deal eventually got done, and why it took so long.

The Glazers entrusted Raine Group with United’s future after the US investment bank led the sale in May 2022 of Chelsea FC, achieving a price of £2.5bn in an accelerated process due to the sanctions imposed on billionaire oligarch Roman Abramovich.

It didn’t take long for the Glazers to act — they began talks with Raine the following month, according to those new stock exchange filings. It took until November 2022 for the Glazers to confirm that they would consider selling a stake in the club, in part or in full, raising expectations of another highly competitive auction.

More than 170 interested parties made contact but predictions of bids from Big Tech failed to materialise. Ultimately, Raine whittled it down to a Qatari group led by Sheikh Jassim bin Hamad al-Thani and Monaco-based British billionaire Ratcliffe.

Compared to the Chelsea deal, the United process — codenamed Project Ruby — moved slowly. The stock exchange filings go some way to explaining the drag. Sheikh Jassim and Ratcliffe both submitted several offers, changing prices and reshaping the bid structures along the way. Ratcliffe’s offer per share started at $22, and landed at $33.

The documents also claim that the Qatari suitor failed to provide “customary financing commitment letters”, raising questions about how viable the offer really was. One person close to the bid has disputed this characterisation and insisted the money to finance a full takeover was there.

However much rivals gossip about Raine’s handling of the deal — and gossip they do — the bank is due to collect a $31.5mn fee for its work after emerging with yet another record valuation.

And it can add another big European club to its trophy cabinet. Raine was an adviser when Silver Lake invested $500mn into City Football Group, owner of Premier League champions Manchester City, in 2019, and on the sale of Olympique Lyonnais in 2022.

Raine also advised both sides as Nassef Sawiris and Wesley Edens welcomed new investment from investment firm Atairos into V Sports, the owner of Aston Villa, just days before Ratcliffe struck his agreement with the Glazers.

Executives can cash in

Two senior Manchester United executives stand to make seven-figure bonuses from the sale of the 25 per cent stake in the club to the British businessman Sir Jim Ratcliffe, while the club’s former chief executive Ed Woodward is also poised to cash in. (Ratcliffe is offering $33 per share, 63 per cent higher than the price on the NYSE).

Patrick Stewart, who took over as interim chief executive late last year, and the chief financial officer Cliff Baty will earn a bonus equivalent to twice their annual salary.

Stewart’s predecessor, Richard Arnold, had a £1.9 million salary, so if his own bonus is anything similar to that figure he should stand to receive more than £3 million.

If Woodward, who has just over 550,000 shares, sells 25 per cent of his shares, he would rake in £3.6m and still have a substantial shareholding in the club.

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The Political Economy of Football V2

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