England’s Declining European Fortunes

We all know that Europe means money. Lots of money. As a top-ranked UEFA association England holds the maximum number of European spots possible (four in the Champions League and three in the Europa), guaranteeing that seven clubs will collect the riches of continental competition each season. In 2010-11 the European adventures of just 6 clubs alone (Aston Villa did not make it through the Europa qualification round) contributed almost 7% of the Premier League’s total revenue!

The four Champions Leaguers earned €158.8m, while the two Europa clubs brought in €12.3m, in total the six clubs grossed €171.1m from the continental season. These figures only represent the TV money distributed by UEFA and do not include the extra matchday receipts, commercial partnerships, etc. The clubs are undoubtedly delighted to have done so well but there is a problem which takes some of the shine off their European bonanza; they are earning less because Europe is a mess. Distributions from the UEFA competitions are denominated in euros which English clubs must translate this back into British pound either for accounting or actual liquidity purposes. The need to exchange euros for pounds exposes the clubs to foreign exchange risk. Continue reading “England’s Declining European Fortunes”

England’s Declining European Fortunes

Summing Up the Manchester United IPO

So what happened to all the Manchester United IPO chatter? Last we heard the Glazers were in the middle of trying to price a deal in Singapore to sell between 25-33% of the club into the market.

The market indigestion of last fall, caused by the unpalatable downgrade of the United States’ credit rating and exacerbated by Europe’s continuing refusal to eat its peas, dropped these plans straight into the tank. Since then equity and credit markets have largely recovered their losses and are off to their best start to a year since 1994. I updated the graphic from last time to show market performance and some key events which have occurred since:

As it is likely that the Red Devil IPO-talk will start cooking again I thought it might be valuable to review the background and details of the transaction.

Continue reading “Summing Up the Manchester United IPO”

Summing Up the Manchester United IPO

The Cost of Manchester United’s European Exit

How much revenue will Manchester United lose by going out of the 2011-12 Champions League? Excel boredom follows:

So in the worst case United will earn €13m less than their 2010-11 European campaign in addition to the loss of five matches of revenue. In the case of a run to the final and a win United will earn €9.7m less plus the benefit of two extra matches.

As a note these figures are based off of 2010-11 payments as UEFA does not release figures (to the public at least) until after the season is over. For a great breakdown of the 2010-11 distribution of UEFA European League money check out Avoiding the Drop.

The Cost of Manchester United’s European Exit