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Football Takeovers: Guaranteed Success Or Just Unneeded Intervention?

Wednesday 29th June 2011
Financial plight, potential profit and a passion to be involved in the “beautiful game” are just some of the reasons why investors may choose to takeover at a football club. The news of a clubs possible takeover bid usually brings with it an air of optimism amongst the fans but does a takeover always yield benefits?

Much like sacking a manager, a fresh face at the helm can usually spark a team to perform well and results tend to pick up. But does a takeover at a club have the same effect? Let's start by looking at Hull City, a team only recently relegated from the top tier of English football and with reported crippling debts, the club was on the brink of administration.

Enter the fray local business man, Assem and Ehab Allam whose business empire is said to be valued at £150 million. Protracted talks began in early November of last year and on the 10th of November 2010, it was announced that current Hull City owner Russell Bartlett had agreed to sell his controlling stake in the club to the Egyptian born businessmen. At the time Hull City were lying in 20th position, 14 points off the play-offs but yet 2 points from propping up the league. Manager Nigel Pearson faced a mountain to climb to get the club's season back on track.

The team badly needed a lift and with the administrators looming the future looked less than bright for the Tigers, but the future owners saw this as an opportunity to “give something back to the community” that had given them their fortune. The new owners planned to clear a £9 million pound bank debt just a few days after the official takeover documents were signed. This gave a new lease of life to the Tigers and come the January transfer window, manager Nigel Pearson could stamp his name on the team with the money provided. Pearson managed to bring in 7 new faces to the club spending less than 5 million pounds.

Assem and Ehab Allam

Hull City finished the season in 10th position with 65 points which I feel is a massive achievement. Since the takeover has been done and dusted Hull have collected 51 points and climbed 10 places in the Championship. Whether the takeover really kicked started the season or manager Nigel Pearson working his magic remains up for debate. But in my opinion, Hull City started the season with debts stretching into the tens of millions, now the club is debt free which is a massive weight lifted off their shoulders. Hull City fan Mark Grayson said: “If you told me mid December when we were just above the relegation zone we would finish the season just outside the playoffs and debt free I would have been gob smacked. Come the summer we will have the money to sign a few more quality players and hopefully next season we'll push for the automatic promotion places.” The fans certainly seem pleased with the cash injection provided by the new owners and welcomed them with open arms to the club. Looking back at the short space of time at the club I think this takeover has been a successful one.

The next takeover I shall I be looking at involves US Sports tycoon Malcolm Glazer who won the control of Manchester United in a £790m takeover bid in May of 2005. On the 12th of May, Glazer upped his stake in the club to 57% but he still needed over 75% to take United off the stock exchange and Mr Glazer could transfer his debt onto the club. 4 days later it was announced that Glazer has secured a 75.7% stake in the Red Devils enabling him to take full control of the club.

When United fans first heard about the proposed takeover they strongly opposed it as they felt ticket prices would soar as a result, some fans even claimed it would be “the death of the club.” On the 13th of May around 2000 fans gathered outside Old Trafford after the news broke with banners bearing the motive “Not for sale” and burning season ticket renewal forms. Manchester United fan, Ben Armstrong said: “Well the season after the Glazer takeover the number of season tickets sold took a major hit but then the Glazers announced that they would be freezing the prices which pleased a few fans. The Glazers could easily have bumped up the prices to line their own pockets but they didn't which was good. Fans are still angered that the Glazers put all their debt onto the club the only way they are going to recoup the debt is if they stay as owners for a long time. So it looks like we're with stuck with them for the long run.”

The supporters wanted more control at the club and so several financially influential members of the community set about a takeover bid and fans named them the “Red Knights” The supporters were becoming increasing concerned about the level of debts which stood at £716.5 million in March 2010. A number of banners appeared at home games and contained the slogan, “Glazers Out” but the Glazers remained firm on their stance of not selling the club.

During the season of 2010 supporters began wearing green and gold scarves reminiscent of Manchester United founder club Newton Heath to back the Red Knights takeover approach. However in the coming months it is understood that the Glazers rejected three offers for the club from the Red Knights. The Red Knights didn't come back with a fourth bid so fans assumed the Glazers would be in charge longer than anticipated. The fans didn't want the takeover in the first place and many still want the Glazers out. Records suggest that the club is still in debt which the Glazers have failed to clear and so I believe this takeover to be unsuccessful.

Man Utd fans voice their discontent outside Old Trafford
Jamie Barwick

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