Manchester United owe around £1.3bn. So how are they going to pay it?

 

 

• Guardiola can often get away with saying anything… but now…
• A different tale, a different view, a different analysis of football

By Tony Attwood

There is an old saying which is used to describe some businesses: “too big to fail”   If things go wrong, it is believed, someone, somewhere, will rescue the company, sometime or other.

But football is a bit different because you can reduce the staff costs, but not at the expense of slipping down the league or attendance figures declining.   You can’t expect close 20 loss making shops in the north est when in essence what you have is one stadium and a training ground.

Less money can be spent on players of course, but if the club slips down the league and gets relegated, the amount of money pouring into the club goes down just when you want it to go up…

Of course much of the problem is that gambling on buying players who will take the club up the league doesn’t always work either.  Besides the debt on the player transfers from last season is still being paid off, and will be for the next three years.  But the fans demand new players to take the club up the league table.

A rich benefactor can help, but these days they are a bit thin on the ground.  Or you can sell your bests players for good fees – but since every other club knows you are only doing this because you are in financial trouble, most buyers will just wait until your club collapses and the player is virtually given away.

Of course there is no sign that Arsenal are in deep trouble – the owners own lots of sports clubs and so are experienced at this sort of game, and seem to know what they are doing.   But not every club has owners like Arsenal.   But still we can ask, how has football got itself into this mess?

It can be hard to know.  After all how many times have we heard, “the financial situation was far worse than we realized” as the opening words from the new owner once he’s looked at “the books”.

Of course what clubs in trouble want is a very healthy and buoyant football market around them, and the ownership of some non-footballing stock (houses for example) which can quickly be sold off.   But in fact they were probably sold off long ago to passing billionaire with time on his hands, load of cash, and a grandson who’d always fancied running a club.   Besides most billionaires who want a club have already bought one, and possibly wish they hadn’t.  

And what makes it worse is that articles on the financial disaster that actually is so many top clubs used to end up with solutions.  Now they don’t, because there are none.

To consider a club in problems like this we might consider Manchester United although their fans might deny it.   They made a profit of £32.6m for the six months to 31 December 2025 – a massive turn around on the loss made in the same period a year ago.   But Man U is £295.7m in debt.  Some is owed by the previous owners, a lot is transfer fees not yet paid for, but all of it is money on which the club has to pay interest.

And they are not the only club  like this.   Tottenham Hots (of whom you may have heard) and Everton are in the same sort of situation having borrowed vast sums to build lovely new stadia.   Something Man U hasn’t yet done, but says it will do soon (the silly buggers).

And the trouble is, it is all so speculative.  Start winning the Cups, get into the Champions League, these are the things that help.  But doing that costs money and of all the things the club doesn’t have at this stage, is money.  It has debt.

Worse if the club tries to cut costs by reducing the size of the squad or even just selling the best player, then the results decline.   Wages can be cut, but the top players you want to play in the big competitions…  Do a Ratcliffe and cut 450 low paid jobs, and then?

He also cut access to the free staff canteen.   And sacked head coach although from what I understand this will have cost money as most contracts have a costly termination clause.

But such clubs need income – for example from being in the Champions League.   But if that goes the only thing to be done is either cut the squad, or sell the players on the highest salaries, or put up ticket prices or both.  But Man U keeps buying players which adds to their debt.

The results decline so the club sacks the manager but the average sacking of a manager and his staff by a club costs about £14m in compensation for termination of contract.   Still Tottenham like to do it must be ok.

Basically failing clubs need is a cheap manager with a tiny staff, who gets the club into the Champions League each year without promising to pay players a bonus.   Or failing that have your stadium already built and have a great team.   That helps.