Posts Tagged ‘Gold & Green’

How a gd analyst (an MU fan) works

In Uncategorized on 19/06/2010 at 5:27 am

Or the reason why no new stars are required at MU?

Andy Green (an analyst in the City of London)  is the Manchester United supporter who first uncovered the extent of the Glazers’ debts. They are £1.1bn in debt – £400m more than previously known – after borrowing extensively against their shopping mall business, he believes to provide equity for their MU bid. It’s like using an overdraft or credit card to pay for the equity portion of yr mortgage.

First Allied is a private business and its accounts are not publicly available. But Mr Green discovered that the Glazers’ shopping mall mortgages had been bundled with other loans as Commercial Mortgage Backed Securities.

Those bundles are publicly traded and therefore require the Glazers to provide detailed information on all the mortgages, which are then publicly available in the US.

Mr Green found mortgages – confirmed by the BBC – on 63 of 64 First Allied shopping centres, totalling £388m ($570m).

Most of those were taken out with Lehman Brothers before the US investment banking giant went bankrupt, triggering the global banking crisis in 2008.

‘Watch list’

While Lehmans collapsed, the Glazers’ mortgage debt lived on and many of those shopping centres are not generating enough income to keep up with interest payments.

With falling commercial property values, many are also now in negative equity.

Banks have put 28 of the shopping centres on a watch list, meaning they are worried about the loans.

Four shopping centres – one each in Ohio, New Mexico, Texas and Georgia – have already gone bankrupt.

When they bought Manchester United in 2005, the Glazer family borrowed £500m and paid the remaining £272 million in cash.

Mr Green found that the Glazers had remortgaged 25 of their shopping centres in the six months before the takeover.

He believes the family borrowed against their US properties to pay for United: “At the time when they had to present a huge amount of cash over here in the UK they borrowed a huge amount of extra money in the US and publicly they didn’t buy anything else that year.”

A spokesman for the family did not respond to questions about the mortgages taken out by First Allied.

But with properties now worth about £380m ($550m) but mortgages valued at £395m ($570m), the shopping mall company now appears to be worth next to nothing.

‘Commercial expertise’

That financial picture has analyst Mr Green questioning how the Glazers will service their £1.1bn debt.

BBC Online article

Gold & Green: Waz the point?

In Uncategorized on 15/05/2010 at 11:04 am

The Red Knights have said that they will not overpay for MU. The group of wealthy businessmen is believed to value the club at no more than £1bn … talks with potential investors “have reinforced our belief it is wrong to offer above fair value”. BBC story

So waz the point of continuing with their plans to bid for MU.? The Glazers have already reportedly rejected a £1.5bn bid from some Arabs.

But at least the Red Knights are spending their own money, unlike, one can reasonably assume on what has been made public, the independent directors of Sino-Environment who went around making sure the corporate governance boxes were ticked while the company was collapsing around them.

MU: Red Knights turn pale?

In Uncategorized on 27/03/2010 at 8:33 am

The Red Knights consortium has revealed it is not planning to make a bid for Manchester United before the end of this season.