Manchester Bankrupt debts up for sale.

While Arsenal continue to sell replica shirts, companies and banks that have stupidly financed Manchester Bankrupt’s dive into bankruptcy are now selling off the club’s debts.   At a discount.

So if you thought that this season’s away shirt is a good deal at 50% off, how about some Manchester debts at 70% off the list price?

You can buy part of Manchester’s debt which is secured against the ground, players and season ticket sales, at 25% off the amount Manchester owe and must one day repay (if they are to stay in business).

Or how about £90m of unsecured loans which are going at 50% off.

Better there is the £152m “payment in kind” debt, on which the insane idiots of Manchester pay 14.25% interest – available at 70% off.

It must be said that Manchester B did not start this sale – they have their loans and they carry on trading.  It is the banks that are trying to get rid of the loans – in some cases because they just need some money, but with the unsecured debt and payment in kind debt, because they doubt that they will ever be paid. In short Manchester Bankrupt is seen in the financial world as a bloody big risk.

Why this is such fun for any fun-loving Arsenal funster is that anyone can buy these debts, including what the Guardian today called rather coyly “the merciless and ruthless” (gangsters and the Mafia to you and me), “who would leap punitively on United if the club were to breach any covenant, however minor.”

What this also means is that no one other than the club and the debt holders will know who holds the debt.

Oh what fun what fun what fun

(c) Tony “with a smile on his face” Attwood 2009.3

5 Replies to “Manchester Bankrupt debts up for sale.”

  1. How exciting! If I were the owner of Man City, I’d be looking to hoover up some of these debts. What an oportunity to stick the knife in and give it a fatal twist!

  2. anyone want to club together and buy some of these debts, and then call it in in a punitive manner? i got a fiver if someone else can front up £100m!

  3. are the terms of the loans / debts fixed? or can the purchaser re-negotiate the terms? are manu up to date with their payments? have they got enough assets to cover the loans if it all goes tits up?

    the possibilities are endless, but manu will squirm their way out of it like they always do.

  4. As far as I can read it, Man U cannot pay the interest on the debts and so are rolling them over into higher debts each year – the interest just adds to the debt. Which is what reduces their value.

    All debts can be renegotiated outside of the contract, but of course you need both sides to agree that. It is commonplace – certainly in my business. A firm owes us money and we doubt we will ever get it back, even if we go to court, so maybe we’ll settle on 50% of the debt paid, just to get something.

    Only to top end loans are covered by the ground etc – the ones on which they are paying the high percentage of interest are the dodgy unsecured loans.

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