by The full details of Sir Jim Ratcliffe’s deal with the Glazers were revealed on Tuesday night when it emerged that Manchester United could not sack Erik ten Hag or make a significant signing without consulting Ineos while the deal awaits approval. Ratcliffe and his Ineos team have to wait four to six weeks for their £1.03 billion purchase of a 25 per cent stake in United which will cement the Premier League.
But under the terms of the deal with the Glazers, who agreed to hand full control of football operations to Ratcliffe, no decision could be made about Ten Hag’s future or the purchase or sale of a player without consulting Ineos. As part of the deal which will see the Glazers’ shareholding reduced to 49 per cent with Ratcliffe taking a 29 per cent stake, it emerged:
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No dividends will be paid for at least three years and priority will be given to investment in the first team squad and Old Trafford.
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The Glazers could force Ratcliffe to comply with a future net sale after 18 months under a so-called “pull-over rights” clause.
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Ratcliffe will decline the first year to next year if the Glazers choose to sell more of their valuable B shares in the future.
United’s extraordinary comeback from two goals down to beat Aston Villa 3-2 at Old Trafford on Tuesday night gave their top-four hopes a major boost and eased some of the pressure on Ten Hag. Ratcliffe is not expected to make any drastic decisions at United, although Ineos are keen to appoint a new director of football, but the Ten Hag’s long-term future is under scrutiny after a terrible season so far.
It is known that Ten Hag still have the support of the current hierarchy but any decision on the future of the manager, director of football John Murtough or the ins and outs of the January transfer window must first go through Ineos. That would suggest, for example, that Ratcliffe would expect to be consulted on any potential departure from Jadon Sancho, who has been in exile since early September after falling out with Ten Hag.
A 241-page filing with the US securities and exchange commission released within minutes of the end of the Villa game revealed that United “could not appoint, dismiss or accept the resignation of any director of football or first-team manager” or buy players or to be sold.without discussion with Ratcliffe and his staff.
Brailsford, the Ineos sporting director who will be on the football club’s board at United provided the deal is approved, was in the directors’ box at Old Trafford last night. Ten Hag said he had yet to hold talks with Brailsford, who is charged with a root-and-branch review of football operations, but welcomed the arrival of the former British cycling boss. “He wants to work with us, I want to work with him,” Ten Hag said.
More than £150 million has been paid out in dividends since the Glazers took over at United and the news that none will be paid for at least three years is likely to be widely welcomed. Rather, the Glazers agreed with Ratcliffe to prioritize reinvestment of such money in infrastructure and staff. Ratcliffe is providing an additional £237 million to invest in Old Trafford although it is understood that much more investment will be needed in the future to fund the redevelopment and expansion of the ground or a whole new stadium.
Although Ratcliffe will first refuse for a 12-month period if the Glazers choose to sell more B shares – which have 10 times the voting rights of Class A shares – the Americans could force the Ineos chairman agree to sell outright. . “Pull forward” rights included in the deal mean Ratcliffe would have to sell his shares subject to receiving a cash offer of $33 (£26) per share from the Glazers if they decide on a full sale 18 months from now.
A right of withdrawal is a provision or clause in an agreement that enables a majority shareholder to compel a minority shareholder to participate in the sale of the company. The majority owner making the “pull” must give the minority shareholder the same price, terms and conditions as any other seller.
The SEC filing said: “So long as the Glazer Parties are the majority holder, after the date that is eighteen months after the closing date and in connection with any complete sale … the board of the company may bind the Trawler Party. [Ratcliffe’s investment vehicle] to sell all the ordinary shares of their company and to take such other steps as are reasonably necessary to effect the full sale.”
The document also confirms, as reported by Telegraph Sport on Sunday, that Brailsford and Ineos Sport CEO Jean-Claude Blanc will join the football club’s board at United and that Ineos chief financial officer John Reece and Ineos Sport chairman Rob Nevin , participating. United Board plc
