Manchester United owners pay off £220 million of debt
Manchester United owners the Glazers are preparing to pay off £220 million of debt, which will get rid of high interest payment-in-kind (PIK) loans.
The American family will use private funds to pay off the debt, which will leave the club £526 million in the red. This may seem negative but it will allow United to start decreasing this amount as opposed
to simply paying off high interest payments.
"I can't speak for any other club, but the United fans should not be concerned.
We have a long-term financing structure in place, excellent revenues that are growing, we are controlling our costs," said Chief Executive David Gill on the Sky Sports
website.
There have been big worries growing from various sections of the club's support base that the Glazers had crippled the club financially for a very long period.
This news should be viewed positively because the club should be able to compete a little more in a financial sense. Just under half of the club's budget goes towards wages
but a smaller percentage, which was used by the Glazers for PIK payments, will now be free.
"Total wages are 46 per cent of turnover and we can afford the interest
on our long-term finance. In our opinion if something changed in the ownership this club will survive and continue, it is covering the financing cost more than adequately," added Gill.
United striker Wayne Rooney recently said he had doubts over the club's ability to attract the best players in the game. However, Gill insists the club can rival any other
side in terms of trying to sign players.
"We still have cash to invest in players and to give good contracts to players
and we are comfortable with the business model," he said.
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