Manchester U finances just get worse and worse

There’s bad news and then there’s even worse news for our dear old chums at Manchester Bankrupt.

There is a thing called base rate – interest rates are worked out on that.  It stands at 5%, which means that your mortgage costs you a bit more than that – maybe 7%.

So it is with interest that we note that Manchester Bankrupt are paying… wait for it… 14.25% a year interest on the loans for which they have failed to pay the interest.

According to the Guardian today Manchester Bankrupt have run up a $150m bill on the  loans whose interest is accruing at 14.25% a year.

No wonder they want a buyer.  Especially when, at the same time, we find out that…

The US Federal Reserve, took over AIG, the sponsors of the Bankrupts, by generously giving them a nifty $85 billion (that’s $85,000,000,000 just to be clear and not risk misleading anyone).   It has now said, as predicted here, that it won’t “consider sports sponsorship a core activity.”

This is such a contrast with Arsenal which has its loans as a mortgage at normal mortgage rates, and as such the club is not suffering one spot from the collapse of the capitalist system.   (I shall be buying my tickets next week on the basis of barter – starting offer is two cabbages and a turnip – but I will be willing to raise the bid if necessary.)

3 Replies to “Manchester U finances just get worse and worse”

  1. The interest rate, fixed for 25 years, is well below the current market rate – 5.25%, I seem to recall. Heh heh heh.

    I think Arsenal are only taking carrots.

  2. Interesting… I thought Man U had got themselves a ‘get out of jail free card’ with the bailing out of AIG but it will be interesting to see how they cope with the loss of that income stream because they already can’t pay the interest on their loans as it is and you wonder how long the banks will accept that in these difficult times. Unfortunately, they have the history and kudos to attract a buyer despite the depressed market, but it certainly makes for interesting times for all concerned!

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