NFL boss not worried by debt
By Jim Slater, 7 Feb 2010 Jim Slater is a Roar Rookie
- Tagged:
- American Football, malcolm glazer, Manchester United, NFL, roger goodell
Malcolm Glazer putting Manchester United into debt for more than $US1 billion ($A1.16 billion) does not worry National Football League commissioner Roger Goodell when it comes to Glazer’s NFL club and solvency.
In his annual news conference Friday ahead of Sunday’s Super Bowl 44 between the New Orleans Saints and Indianapolis Colts, Goodell addressed several global topics impacting the NFL, including the Glazer family’s financial situation.
“They are sound owners,” Goodell said. “They are terrific for the NFL and we don’t see any factors that would stress any of their sports teams or other operations.”
What has stressed Manchester United supporters is the severe debt load the fabled English Premier League side has amassed since Glazer, who owns the NFL’s Tampa Bay Buccaneers, took over in 2005.
Accounts filed last month revealed the massive debts. The club is trying to sell $US800 million ($A925 million) in bonds to help dig the club out of debt.
Goodell backed Glazer, one of the 32 club owners who employ him, despite the NFL’s own economic worries.
Goodell said that concern over costs in a tough economic environment and the lack of a new labour deal with players has limited the NFL’s ability to expand globally.
“There are billions of fans we think will love the game if they are exposed to it, but that takes an investment,” Goodell said.
Labour and money concerns prompted the NFL to reject a second regular-season game in Britain this season, although they will send the San Francisco 49ers and Denver Broncos to meet at Wembley Stadium in London on October 31.
“We seriously considered playing two games in the UK. We decided not to,” Goodell said. “It’s an investment. It’s a short term loss for the clubs involved. I’m not sure it made sense in this environment.”
The NFL is focusing on staging regular-season games in London rather than Asia in part because in the short term the logistics are easier, Goodell said, but stressed Japan and China remain important markets to the league.
“It’s important for us to continue to be there,” he said. “There are some unique challenges to playing a regular-season game in the Far East. We think we can handle them but the goal right now is to be successful.”
Returning to Mexico City remains an easier possibility, especially if the regular-season is boosted beyond 16 games in a new labour deal, Goodell said.
“We’re not making a choice of London over Mexico. We think we can do both successfully,” he said. “We would love to be back in Mexico. It has to be right for us and out partners in Mexico.”
The Buffalo Bills play one regular-season game a year in nearby Toronto and the Canadian city remains a priority for the NFL.
“We want to continue to service that market,” Goodell said.
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Tifosi said | February 7th 2010 @ 8:32am | Report comment
Ask the fans of Manchester Utd and Tampa Bay if they actually think the Glazers are good owners. You wont get a nice answer from any of them !!
TheMagnificent11 said | February 7th 2010 @ 12:27pm | Report comment
I’m a Man Utd fan and while I don’t like the Glazers, I think there is a lot of misconception about the debt situation. Red Football, the company the Glazers own that owns Man Utd and Tampa Bay has 700 million pounds in debt. About 300 million of that is tied to Man Utd. Considering that Man Utd has the largest revenues of any football club, they can cover the payments on the bond issued for this debt (as long as they remain successful on the park). The bad news is that about 75% of Man Utd’s profit goes towards paying off debt or lining the Glazers pockets. So only 25% is reinvested in the club (improving facilities, player transfers, wages etc). I don’t know what percentage went to shareholders when it was a publicly listed company, but it certainly wasn’t 75%. So the club would be better off without the Glazers, but they can still operate with them (heck we’ve won plenty of trophies while they’ve been owners). I don’t know how long it will take to pay off the debt, but hopefully there won’t be too much damage done in the meantime. From the Glazer’s point of view, it appears a sound investment.
Art Sapphire said | February 8th 2010 @ 2:00pm | Report comment
You are right Maginificent 11 from Glazer’s point of view it appears a “sound investment” from everyone else’s its an absolute debacle. The club was already successful before Glazer took over. Glazer have nothing to do with their current success. Ferguson built United. All the Glazers have done is build a gigantic debt mountain.
Red Football Joint Venture paid £68.5m interest on their debts in 2009 of 716m pounds.
When the Glazers took over they borrowed 540 million pounds. So in 5 years ,all they have done is increase the debt by another 176 million pounds. Ronaldo was sold 80 million pounds. Who are Man U going to sell off next to keep their debt under control. Strangely, every Man U supporter hates the Glazers, except you.
mushi said | February 8th 2010 @ 1:27pm | Report comment
“Accounts filed last month revealed the massive debts. The club is trying to sell $US800 million ($A925 million) in bonds to help dig the club out of debt.”
Jim here is a little markets 101 for you: bonds are debt. So selling $800m of bonds into the market doesn’t “dig you out debt” as you are still in debt just to different people. If you don’t know what a term means don’t use it in your article.
mushi said | February 8th 2010 @ 3:49pm | Report comment
out OF debt (I miss the little edit function)
Beast-A-Tron said | February 14th 2010 @ 3:25pm | Report comment
Quite right mushi. They are attempting to re-organise their debt (not pay it back), so hopefully their new debtors are more risk-seeking investors. This depends on the continued success of Man U, which seems likely to me. But hypothetically what happens if Man U have a real bad year?
With Man U labouring under this debt, how will they intend on attracting the best players going round, or retain their own superstars? I don’t know enough about soccer finance to answer those questions, so I won’t presume the negative outcome, though perhaps someone with more knowledge than me about the EPL and the Big Four can answer such relevant questions.
I’m also ignorant of how a season’s performance will directly affect the cash flow of an EPL club, but would be interested to know the answer.
Art said – “Ronaldo was sold 80 million pounds. Who are Man U going to sell off next to keep their debt under control.”
Well they do own Old Trafford I believe? But that is a long asset, which they would be loathe to mortgage/sell in order to meet short term debt obligations. Maybe Man U will slide to the middle order of the ladder?
Mikop said | February 16th 2010 @ 10:26pm | Report comment
I can’t see Man utd being allowed to fall that far. The club will be bought before that comes close to happening. I would already advise the Glazers not to visit England though…Its not that they are disliked….they are hated, hated with a passion.