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The Qatari bidder for Manchester United is withdrawing from the race to buy the Premier League club, leaving the path clear for Sir Jim Ratcliffe to pursue a deal with the Glazer family.
Sheikh Jassim bin Hamad al-Thani, the son of one of Qatar’s richest men, had been the only party looking to buy 100 per cent of United, while Ratcliffe has explored a variety of investment options, including most recently a minority stake.
However, following a final round of talks with the Glazers, who have owned United since acquiring it in a leveraged buyout in 2005, Sheikh Jassim has decided to pull out, according to a person close to his bid. The person added that the Glazers had set a “fanciful” valuation for the club, which is publicly listed on the New York stock exchange.
Sheikh Jassim, whose father was previously Qatar’s prime minister and head of its sovereign wealth fund, had offered to buy the club outright without using debt. He had also promised to invest in both the playing squad and the club’s infrastructure. Old Trafford, United’s home ground, and the team’s training centre, are both in need of expensive upgrades.
The decision comes almost one year after the Glazers said they would consider a variety of strategic options for the club, including a potential sale. The family’s advisers have also held discussions with a number of institutional investors, including US private equity firms, to explore alternative routes for raising capital.
The protracted sale process, which is being handled by investment bank Raine, has drawn criticism from people close to each of the bidders. Several people close to the situation have highlighted the fact that control of the club is divided across six siblings, who may not always agree.
The Glazers sought offers for the club just months after US investors Clearlake Capital and Todd Boehly bought London rivals Chelsea FC for £2.5bn, still the record for an outright sale of a football club. That price fuelled hopes that United — a club with bigger revenues and a wider global following — could command a far greater sum.
However, people close to the Glazers and United have raised doubts about the likelihood of a successful Qatari bid for several months, pointing to Ratcliffe’s willingness to be flexible on structure. The British billionaire’s latest offer looks set to allow the family to stay on at the club.
In a sign that investors’ expectations for a full sale have been waning, United’s New York-listed shares are down more than 12 per cent this year, valuing the club’s equity at around $3.2bn. Both bidders have made offers that value the club significantly higher.
Ratcliffe, founder of chemicals empire Ineos, is a life-long United supporter, and made a pitch early in the process to return the club to its local roots. However, his initial offer was focused on buying out only the Glazer family’s stake, leading to potential complications with the club’s minority shareholders.
Over the summer Ratcliffe’s team considered altering their offer, including potentially purchasing a minority stake from both the Glazers and those holding the club’s listed shares. One person said the bid had recently focused on around 25 per cent of the club.
Should Ratcliffe agree a deal to buy into United, it could position him as the club’s next natural owner, according to a person with knowledge of the matter. United’s board is due to meet in the coming days, ahead of its next earnings report.
The US owners of Liverpool FC, another Premier League club with a storied history and a huge global fan base, also explored a potential sale after the Chelsea buyout. However Fenway Sports Group ultimately agreed to sell a small stake in the club to Dynasty Capital, a new private equity firm, last month.