The Battle for Manchester United: Sheikh Jassim Empowered to Lead Ownership Bid as Sir Jim Ratcliffe Weighs Investment Options

Sheikh Jassim remains determined to proceed with his bid to acquire Manchester United, even though Sir Jim Ratcliffe is contemplating acquiring a minority share. The Qatari banker and British industrialist have submitted offers valuing the club at approximately £5bn. However, the Glazers continue to wait for more lucrative proposals.

Ratcliffe mulls minority stake in Man Utd

Sky News has discovered that Ineos Sports, owned by Sir Jim, has offered the Glazer family a deal. The deal would involve acquiring a proportionate amount of their shares, as well as the publicly traded stock on the New York Stock Exchange. Both sets of shares would be offered at the same price. The latest proposal suggests that Sir Jim may pursue a 25% stake in the Red Devils.

To acquire a quarter of United's shares, Ineos Sports would have to pitch their offer within a valuation range that the Glazers would find acceptable. Reports suggest that the minimum valuation sought by the Glazers is £6bn, thus indicating that Ineos Sports may need to allocate around £1.5bn for the acquisition. Nonetheless, even if this deal were to proceed, it is highly likely that the Glazers would retain control over Old Trafford, as they have been in command of the club since 2005.

This would infuriate Manchester United supporters who have vehemently voiced their disapproval of the family's ongoing ownership, prompting additional concerns about the club's future. In terms of performance, the men's team has experienced a lackluster beginning to the 2023/24 season, suffering a defeat at home against Crystal Palace in the Premier League last weekend and losing their inaugural Champions League match.

On Monday evening, there was uncertainty regarding the level of involvement of the Glazers and their advisers at Raine Group in relation to Sir Jim's minority stake proposal. Since acquiring the team for nearly £800m in 2005, the family has maintained a mysterious demeanor throughout the entire process and has not provided any significant updates to the NYSE since engaging with potential buyers started last November.

Another question is whether offering Sir Jim a significant stake in the club would generate additional funds for the ongoing redevelopment of Old Trafford. Moreover, the approach to acquiring a minority share remains ambiguous, with one analyst proposing the possibility of pursuing a tender offer as a potential solution.

Last week, Bloomberg News reported that Ineos was planning to restructure its bid, but did not provide any specific details on how this would be accomplished. Certain holders of the publicly-traded A shares have expressed worry over Sir Jim's previous proposals. These proposals centered around obtaining a controlling interest in the club by purchasing shares from the six Glazer siblings who possess the B shares, which have unequal voting rights.

There is also the question of whether a minority deal, should it be agreed upon and executed, would grant Ineos Sports a potential route towards complete ownership of Manchester United. In May, Sky News disclosed that their offer at that time featured put-and-call arrangements that would become exercisable three years after the takeover, allowing Sir Jim to obtain the remaining shares of the club.

The billionaire from Monaco, who owns Nice in Ligue 1, had initially set his sights on acquiring control of Manchester United. However, in an effort to overcome the current deadlock regarding the future of the club, he has now proposed a modified agreement, transitioning towards a minority deal. Although his preference remains purchasing a majority stake, this adjusted proposal seeks to facilitate progress.

On Monday, an Ineos spokesperson refrained from commenting, citing the non-disclosure agreement that the bidders had signed as part of the process. Ineos has been engaged in a prolonged competition with Sheikh Jassim bin Hamad al-Thani, a Qatari businessman who chairs Qatar Islamic Bank, for control of Manchester United.

Sheikh Jassim's offer still stands, and the complex nature of the strategic review initiated by the Glazers in late 2020 implies that a new proposal from the Middle East should not be completely dismissed.

Reports suggest that the executive co-chairs of the club, Avram and Joel Glazer, have exhibited more reluctance to sell compared to their siblings throughout the process.

Alongside Sir Jim and Sheikh Jassim's competing bids, the Glazers have received numerous credible offers for minority stakes or financing to support the club's investment. Notable among these offers are from prominent American financial investor Carlyle, American hedge fund Elliott Management (formerly owned AC Milan), US-based alternative investment group Ares Management Corporation, and Sixth Street, which recently acquired a 25 percent stake in FC Barcelona's long-term LaLiga broadcasting rights.

The purpose of these was to secure funding for the renovation of United's outdated physical infrastructure. The Glazers justify their high valuation of the club by expecting increased control over its profitable broadcast rights, as well as aiming to capitalize on the commercial potential of arguably the world's most renowned sports brand.

United's New York-listed shares have experienced significant volatility in recent months, with reports indicating that a potential agreement is imminent or that the Glazers were on the verge of officially terminating the sale proceedings.

As of Monday, the shares were being traded at approximately $19.43, which resulted in the club being valued at $3.25bn in the market.

Earlier this year, the Manchester United Supporters Trust, the biggest fans' group of Manchester United, urged for the prompt conclusion of the auction. The Glazers' ownership has been plagued by controversy and demonstrations, as fans' discontent stems from the debt-driven acquisition and the absence of a Premier League title since Sir Alex Ferguson's departure as manager in 2013.

The Glazers' involvement in the doomed European Super League intensified fans' anger, fueling the demand for new owners to take over.

Avram and Joel Glazer acknowledged the immense support of Manchester United's worldwide community of 1.1 billion fans and followers as they announced the commencement of a strategic review in November.

"We will explore all possibilities to ensure that we effectively cater to our fans and enable Manchester United to fully capitalize on the ample growth prospects presented to the club in both the present and future."

The Glazers initially offered a small portion of ownership of the company in New York back in 2012, yet they still maintain a dominant hold by employing a dual-class share structure that grants them nearly all voting privileges.

During their reign, the phrase "Love United, Hate Glazers" has gained popularity among fans who express dissatisfaction with the owners' alleged negligence towards investing in the club. Despite Manchester United's consistent profitability, the owners have reportedly benefited greatly from it, leading to widespread criticism. On Monday, a spokesman for the club chose not to provide any comments.