Manchester United take out further $125million in long-term debt

Manchester United have taken out a further $125million in long-term debt following a refinancing of borrowings related to the Glazer family’s 2005 takeover.

A filing to the U.S Securities and Exchange Commission (SEC) confirmed on Friday that United have restructured their $425m senior secured notes, which were due for repayment next year.

The refinanced debt now amounts to $550m, at a higher interest rate of 5.36 per cent. The previous rate, secured in 2015, was 3.79 per cent.

At that higher rate, United’s annual interest payments will rise by approximately £10m at the current exchange rate. During the 2024-25 season, United paid out £37m in interest costs.

Having previously been due for repayment in June 2027, United’s terms have now been extended until 2031. United’s senior secured notes are one of the club’s two tranches of long-term debt, alongside a secured term loan facility worth $225m.

Both are a legacy of American businessman Malcolm Glazer’s controversial leveraged buy-out of United in 2005, which loaded £604m of debt onto the Old Trafford club.

United also hold short-term debt which is regularly repaid in the form of a revolving credit facility (RCF). As of late May, United’s RCF borrowings stood at £150m.

Following the refinancing, the club’s total financial debt stands at £727m. United’s outstanding transfer debt is currently £360m, of which £209m is due within the next year.

In the SEC filing, United said borrowings would be used to pay the $425m due to expire next year and for “general corporate purposes”.

The upsize in long-term debt echoes a theme surrounding borrowings at the club since Sir Jim Ratcliffe acquired a stake in February 2024.

United have regularly both drawn down and repaid tranches of their RCF debt, and they upsized that to £400m last year. At the end of May, they had £250m in available headroom there.

Such activity reflects tactics employed by Ratcliffe at INEOS, the conglomerate which made him his fortune. Since inception, INEOS has been funded mostly by debt, with refinancing taking place regularly throughout the company’s 28-year history.