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Man United takeover: Kieran Maguire 'scratching his head' at new Ratcliffe development
It makes no ‘business sense’ for Sir Jim Ratcliffe to take out loans in order to buy a minority stake in Man United.
That is the view of finance expert Kieran Maguire, who exclusively told Football Insider that he has been left ‘scratching his head’ over the involvement of loans in United’s takeover.
As reported by the Daily Mail, Ratcliffe is using loans from two banks — Goldman Sachs and JPMorgan — to fund his United deal.
The British billionaire is set to acquire an initial 25 percent stake in the club after rival bidder Sheikh Jassim pulled out of the process.
The Glazers and Ratcliffe are currently ironing out the details of the deal, which will cost Ratcliffe’s INEOS around £1.3billion.
However, there are growing concerns that Ratcliffe purchasing shares with loans could land United in more debt.
Maguire understands the concern of United fans considering that the Red Devils have already paid over £900million in interest due to debt accrued under the Glazers.
“I can understand the reservations that Manchester United fans would have because under the Glazers the club has paid out over £900 million in interest since 2005,” Maguire told Football Insider’s Sean Fisher.
“This decision to take out loans in order to buy shares is lacking in logic or business sense.
“The reason for this is because whether it’s Ineos or Sir Jim that is going to be the party making the purchase, they will be buying the shares from the Glazers or they will be buying the shares from other shareholders.
“So this has got nothing in its own right to do with Manchester United.
“This is a private transaction.
“So I’m scratching my head as to this, and why loans are involved.
“It could be that as part of the deal, Ratcliffe will loan money to the club for infrastructure purposes and that loan could carry six percent interest.
“But I can see no traditional business reason why the share purchase itself should be associated with debt unless the club is going to issue more shares.“
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