Thread by @SwedishRumble

(1/17) While the dust is settling on the battleground after months of strategic discussions behind the scenes, we are entering the final week before first bids is to be submitted. In this 🧵, I provide my thoughts, as a Public M&A lawyer, on the lay of the land.

(2/17) The reports on Sir Jim Ratcliffe (Ineos) clearly indicate that he is prepared to make a bid and that he has secured financing (on a Certainty of Funds basis) for his (Ineos) bid. Ratcliffe and his team has vast M&A experience, and will put up a fight.

(3/17) Would Jim Ratcliffe be a good owner? What about Nice’s performance? What about debt? I am fairly certain that he would be a perfectly OK owner. “FFP” – does – limits the impact of the depth of the pockets of potential buyers.

(4/17) In the below thread, I cover what it means to have the bid for us debt financed (nothing). Ultimately, it does not make sense for anyone to buy us and not put the club back on top, since that is profitable, while being a top 5-8 PL team is not.

https://twitter.com/SwedishRumble/status/1623800900438351873?s=20&t=hlBcffesC7my-_fJoTcKww

(5/17) The Raine Group have proposed the prospect of buying MUFC to the Qataris, who seem to be legitimately interested. This is why the Raine Group is engaged, and their remuneration structure is contingent on the price they can get the Glazers. #PropositionJoe

(6/17) See thread below on the multi-club-ownership question, tl;dr it should not be a problem. But, at the same time, it could be a nuisance. Ultimately, it does however not sound guaranteed yet that the Qataris actually will make a bid.

https://twitter.com/SwedishRumble/status/1623119569014358016?s=20&t=hlBcffesC7my-_fJoTcKww

(7/17) Why would the Qataris buy us? It has nothing to do with “sports washing”. In the view of finance, these entities have been ‘allowed in’ for over a decade. It is a misunderstanding that a country that is allowed to “buy Heathrow”, needs sport washing.

(8/17) Instead they aim to make investments in sustainable brands that are not expected to have a limited lifetime. The top 1 and 2 cell phone brands can ‘go out of business’ in 5-10 years (Ericson and Nokia), while we will be drinking “champagne” in 300 years.

(9/17) The wealthy US owners with interest in sport teams does not seem to be in for a full takeover (if so, they ought to have been more public), but I would expect one at least to be involved in a consortium as a figure head that includes financiers like the 6th Street.

(10/17) The business plan is roughly the following: (a) The consortium members agree to sell the club within a stipulated time frame (5/10/15 years). This would not be an intention, it would be in fairly granule writing.

(11/17) (b) The idea is surely to come in, put the club back as one of the ‘best in class’, build state of the art premises, so that the club could be sold as a premium asset in whatever time frame that have been established.

(12/17) The main participants of the US consortium would be something like:
*A US pro team owner “figure-heads” the consortium and get strategic influence/publicity.

(13/17) *A US financier, like 6th Street, is involved who finance big parts of the consortium, against long-term interest in future broadcasting rights etc. And of course, interest in funding the stadium. I mean, there would be many banks fighting to fund a 1.5-2bn project.

(14/17)*A strategic investor is involved who takes a larger stake, but that to a large extent intends to act as a feeder fund/intermediate investment for other funds/investments looking to get exposure against sporting teams.

(15/17) There also seem to be legit interest from a couple of entities in China. Could absolutely be an established company like Tencent or more investment minded entities. Why? The same logic for all of the above, also apply to them. The one difference…

(16/17)…is that while Qatar is flying high of high prices for LNG, Chinese investors is still suffering from just ending strict Covid lock-downs. If say Liverpool is sold in 2-3 years, I wouldn't be surprised if Chinese investors made more noise in the bidding process.

(17/17) Lastly, I would definitely not rule out a dark horse bidder. In any auction process, you cannot rule out anyone showing up next Friday or even after that. Taking everyone by surprise, is a tactic in auctions that has its pros (and cons).

Lastly, I do not have the biggest twitter following, so if you like this thread, smash a like and retweet it!

Some additions to the above. I also think that there will be Saudi interest. They did bid for CFC, but were disqualified on a technicality. But I do not hold them as likely buyers, simply because you have a great deal of “transaction risk” with them that does not come from the…

…others due to the #Kashoggi affair. If you have two potential buyers in the same vicinity, I think the Saudi’s are out.

On a ‘watch this space’ perspective — will David Beckham show up in this process? I would not rule it out. First of all, for anyone with ambition to build a football group — Beckham has an asset in Inter Miami. Secondly, he has a good reputation.

In addition, in processes like this, it’s not unheard of, for bidders to merge their interest. It’s of course impossible to speculate on whether it is likely, but theoretically, Qatari and Ineos/Ratcliffe could join forces. From afar, it does not seem like their interests could..

..not be aligned on the same side.