03.01.2010
Man United mulls bond issue on 700 million pound debt: reports
The scoreboard is seen after Manchester United lost to Leeds United 1-0 in their English FA Cup football match at Old Trafford in Manchester. Manchester United is considering a bond issue as part of the English Premier League champion's efforts to control its 700 million pound debts, a report said Monday.
Investment bank JPMorgan and Germany's Deutsche Bank are advising the football club, champions for the last three years, on options to improve the club's financial situation, the Financial Times said, quoting unnamed sources.
One option under consideration would be the issue of high-yield bonds, according to the newspaper.
The Sunday Times reported that the cash raised would be used to pay back some of Manchester United's existing debts.
The club owes about 700 million pounds (788 million euros, 1.12 billion dollars) to banks, financial institutions and hedge funds, according to debt specialists, quoted by The Sunday Times.
Most of this stems from the American Glazer family's takeover in 2005 which was criticised by fans because so much debt was loaded on to the club.
The club, knocked out of the FA Cup on Sunday by Leeds United, says the debt is not a problem because the annual interest on its various loans is covered by its operating profit, The Sunday Times said.
Source: © 2010 AFP - Paul Ellis
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