Manchester United owners to pay off huge debts
London: Manchester United received a double financial boost as their owners agreed to pay off huge debts from outside club funds while first-quarter results on Tuesday showed strong matchday and commercial revenues.
United`s owners, the Glazer family, sprung a huge surprise by agreeing to pay off a 220 million pounds (USD 350.6 million) payment-in-kind (PIK) loan from funds outside the club.
Joel Glazer, co-chairman, has signed a "voluntary free-payment notice" confirming that 100 percent of the outstanding loan would be repaid on Nov. 22, a source with knowledge of the situation told reporters.
United, bought by the Glazers five years ago, converted their debt into a 500 million pounds bond in January and under its terms they could take 70 million pounds from the club to repay part of their main PIK debt.
Neither the club or a spokesman for the Glazers would comment on the matter on Tuesday.
Last month United announced a loss of 83.6 million pounds for the year ending June 30, much of it attributable to interest payments but their figures for the three months to Sept. 30 released on Tuesday were more upbeat.
Year on year revenue grew 9.7 percent from 57.7 million to 63.3 million, matchday revenues rose 0.5 percent from 19.6m to 19.7m, media revenues rose 3.7 percent to 19.4m while commercial revenues were up 24.7 percent from 19.4 million to 24.2 million.
Overall there was a 4.9 million pound loss due to interest payments and other operating expenses.