Liverpool And Manchester United Are Up For Sale

In November 2022, the owners of Manchester United and Liverpool FC announced that they were willing to accept takeover bids, with the clubs anticipated to be valued at approximately £3.3 billion and £5 billion, respectively.

According to sources, recent annual losses and competition from wealthy owners of rival clubs, including the Saudi Arabian Public Investment Fund, may be putting them under pressure.

Additionally, they cited increased interest from institutional and private equity investors in the creation of novel monetization strategies centered on the expanding international fanbase of iconic clubs; and establishing a benchmark with the recent sale of Chelsea FC.

Analysts believe that the fact that the two largest and most profitable soccer teams in the world are currently available for purchase simultaneously is not an accident.

With the possibility of full sales of the top English clubs, both teams have stated that they are open to new investment offers.

12 years after purchasing the club for £300 million, Fenway Sports Group, a sporting conglomerate based in the United States, is believed to have valued it at approximately £3.3 billion ($3.97 billion). A sales deck has been created by Goldman Sachs and Morgan Stanley for parties who are interested.

On the other hand, on November 23, 2022, the announcement that Manchester United’s owners were similarly opening themselves up to investment opportunities caused the New York-listed company’s shares to rise by 18%. The club’s full takeover is expected to fetch at least £5 billion.

Since acquiring a controlling stake in the club in 2005 for £790 million in a contentious, highly leveraged deal that resulted in the addition of a substantial debt pile, the American Glazer family, the club’s majority owner, has had a turbulent relationship with the fans.

The Glazers’ lack of investment in the club’s facilities and players is a frequent gripe among Manchester United supporters.

However, Newcastle, which was acquired last year by an investment group led by the Saudi Arabian Public Investment Fund, and Manchester City, which are both majority-owned by Dubai royal Sheikh Mansour bin Zayed Al Nahyan, will compete with Newcastle for any future funding boost.

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According to Harraghy, who also cited Qatari-owned Paris Saint-Germain, “the current owners of Liverpool and Manchester United will be considering the level of investment that’s required to keep up with rival clubs who have owners with deeper pockets, both domestically and in Europe.”

“State-funded Middle Eastern owners permit the clubs to spend heavily on the club’s infrastructure and player acquisition to continue improving their footballing and financial performance,”

Manchester United reported a rise in revenue but a net loss of £115.5 million for the fiscal year 2022, up from a £92.2 million net loss the previous year, even though the Glazers have paid themselves dividends since 2016.

Due to the pandemic decimating match day revenue, Liverpool reported a £4.8 million before tax loss in the year to May 2021 and a £46.3 million loss in 2020 in its most recent published results.

Harraghy went on to say that “it is possible that those in charge no longer see the expenditure as sustainable, given the level of competition they face.”

Both Liverpool and Manchester United owners have been in charge of the teams for a considerable amount of time, and both clubs’ assets have appreciated significantly as their leagues, brands, and global fan bases have grown.

Regarding revenue opportunities, media rights are becoming increasingly important to leagues, especially internationally. Investors will have noticed the significant growth in the English Premier League’s global audience.

International fan bases can be further monetized through experiences, merchandise, and overseas games, just as American football and basketball games are attracting large audiences in the United Kingdom.

In point of fact, both clubs have achieved success in “phase one” of converting their brand equity and international fan bases into revenue, but in recent years, their growth has slowed down.

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From Japanese noodles manufacturer Nissin to Middle Eastern banks, Manchester United, in particular, set a new standard for selling broadcasting rights.

For the first time ever, Premier League broadcast revenue was higher internationally than domestically in 2022.

The quick sale of Chelsea in May, which was rushed through amid a U.K. crackdown on the assets of Russian oligarchs following the Russian invasion of Ukraine in February, will have been closely watched by owners of Premier League clubs.

After the government confirmed that the proceeds would not go to Roman Abramovich, the club was purchased by a consortium led by American investor Todd Boehly for £4.25 billion, with £1.75 billion reserved for future investments.

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