As managerial reigns go, few can hold a candle to Sir Alex Ferguson’s time at Manchester United. In 26 and a half years, Sir Alex won 38 trophies, helped to develop numerous world-class stars like Roy Keane, Peter Schmiechel, David Beckham and Cristiano Ronaldo, oversaw the rapid expansion of Old Trafford to its current 75,000-plus capacity and made us a team to be feared.
When Fergie took over, we weren’t punching our weight. Although the early stages of his time with us weren’t great, he was in it for the long haul. Fergie drew upon the large pool of talent from our youth academy and gave them a chance of succeeding. His faith in youth paid off, and as the club grew, so did our capability to win against Europe’s finest.
Complete transformation
After the changes made by Sir Alex on the pitch took effect, financial success followed. In the space of quarter of a century, United have changed immeasurably – home fixtures routinely attract over 75,000 fans, while millions of people worldwide support the club. That, along with their standing in the game makes them attractive to sponsors and investors alike.
As recently as January, United’s net worth was estimated at $3bn according to Forbes. This is partly due to the fact that United are listed on both the FTSE and NYSE, although concerns about Fergie’s departure may leave shareholders in the club and sponsors concerned about what the future may hold for the club.
If United fail to retain their Premier League title and disappoint in next season’s Champions League, then there’s a chance that attendances could fall, income will drop and United suddenly become a less attractive proposition for shareholders looking for a safe bet.
Market movements
Given the club’s size, we recently got a listing on the New York Stock Exchange to try and raise funds from share issues. On the news that Sir Alex was to retire at the end of the season, our share price fell overnight by 4.5% during trading. Part of our global appeal was down to Fergie’s huge influence, and his departure leaves big shoes to fill.
David Moyes is the new United manager, and he’ll want to make sure that he gets enough money to mould the current squad into one he could work with. In terms of spending money, the recent news that income in the last quarter stood at a record £91.7m could give him a little encouragement.
Sponsor-driven growth
As Joshua Raymond from city index explains, sponsorship deals have driven recent growth for United, but the future is a little less clear. He said:
“Manchester United’s commercial dominance has been further entrenched within their quarterly numbers. Revenues rose broadly in line with market expectations of close to 30% to £91.7m, whilst the recent success of winning the Premier League will also enable the club to secure more lucrative sponsorship deals and increases the value of the Man United brand.
“There remains an open question however on the sheer volume of sponsorship deals being secured, which may slow but could also impact the long term value of the brand. For now though, these numbers will likely please shareholders.”
How do you think United will perform next season? Will Moyes be able to strengthen the club in the summer transfer window? Let us know your thoughts below.
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