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A financial advisor who previously worked for a rival Premier League club has indicated that Manchester United are likely to take on the debt of the construction of a new stadium instead of INEOS.
Since Sir Jim Ratcliffe completed his partial investment into the club, the British businessman has repeatedly stated his desire to see United get a brand new arena that will become the envy of other teams in Europe.
It’s believed that Ratcliffe is eager to create a ‘Wembley of the North’ to rival the 90,000-seater national stadium in north London.
In an effort to realise his great ambition, Ratcliffe set up the Old Trafford Regeneration Task Force, putting himself as chair. Other members of the task force include Lord Coe, former United captain Gary Neville and Mayor of Greater Manchester Andy Burnham.
Ratcliffe has been pushing for public funds to aid in the regeneration of Old Trafford and the surrounding areas despite no clear political support for this idea being forthcoming. Labour leader Sir Keir Starmer was a guest of the Red Devils during their match against Arsenal in May. On that occasion, heavy rain caused the Old Trafford roof to give in and made the stadium flood.
One of the main issues that requires clarification before the project gets underway is who will assume the burden of funding the project. Owing to their history, the Glazers are unlikely to reach into their pockets to bankroll it.
According to former Man City financial advisor Stefan Borson who spoke to Football Insider, Ratcliffe’s INEOS are also unlikely to take on the debt for the new stadium project even as the 71-year-old petrochemicals mogul explores potential funding options.
Borson said, “The debt will definitely be on an entity of Manchester United, it won’t be on INEOS.”
“INEOS are only a 25-28 per cent shareholder. There is no way INEOS are going to take on the debt of United for the other 72-75 per cent shareholders..”
“There may be some structure where INEOS guarantee or provide some kind of extra security for the loan.”
Borson added, “But ultimately, the essence of INEOS taking on the debt would be effectively to subsidise the Glazers and the public shareholders, so I don’t think they are going to do that.”
“But it is an issue for United, they have already got a huge amount of debt anyway, so loading on another £1billion of debt on the stadium as an asset is not ideal.”
“It’s certainly not going to look good optically.”
Meanwhile, United recently confirmed that work has commenced on a redesign of Old Trafford’s player tunnel.
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