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Old 17th May 2005, 09:03   #1
TanyaT
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Default How Will Glazer Increase Revenue at Manchester United?

How Will Glazer Increase Revenue at Manchester United?
PA May 16th 2005

Malcolm Glazer’s 790million takeover of Manchester United contains 540million-worth of debt.

It is estimated that the Glazers need to increase United’s average annual profit by at least 20million just to pay off the interest on their 540million loan.

Here PA Sport takes a look at areas where the Glazers might be able to maximise revenue.

Premiership TV rights money – Premier League chief executive Richard Scudamore believes Glazer would find it “almost impossible” to organise a revolt against the collective television bargaining deal.
In Italy Juventus, who are allowed to negotiate their own television deal, rake in around 70million a year from it, compared to the 25million United make.
United would love to follow suit and negotiate their own deal but the Premier League’s constitution requires 14 out of the 20 clubs to vote in favour before any changes can be made.
Glazer could opt to challenge the current deal through the courts or seek a compromise deal whereby the next television deal continues to split money from UK rights evenly between Premiership clubs but Premiership giants like United are allowed to negotiate their own worldwide deals.
MUTV – The club’s own television station, MUTV, has between 90,000-100,000 subscribers in the UK, a number which rises further over the pre-season period when friendlies are shown live.
Worldwide MUTV is currently distributed in 68 countries and there are 18 million homes where MUTV is received in various subscription packages.
If United are able to negotiate their own worldwide TV deal in the future then MUTV could be the vehicle to beam live matches around the world.
Marketing – United are reported to have 75 million fans worldwide but only 750,000 who spend money on the club. Glazer will be looking at ways of increasing United’s marketing revenue.

Ticket prices – Ticket prices at Old Trafford have already been set for next season so any further hike could not be introduced until 2006-07. The Glazers could however consider introducing a debenture scheme.

Stadium re-naming – If Glazer can find a lucrative sponsor then the re-naming of Old Trafford would be one way of raising money, even though it would further alienate United fans.
Old Trafford sale-and-lease-back – This would be a way of freeing up money or rescheduling repayments but the Glazer camp have thus far stressed they have no intention of doing this.

Shareholder dividends
– United currently pay out a 12million-a-year dividend to shareholders. Glazer will be under no obligation to pay a dividend once he has taken the club off the stock market.
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