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13 May 2005

FOR IMMEDIATE RELEASE


GLAZER OFFER: THIS IS ONE YOU CAN REFUSE

Malcolm Glazer has now issued the summary terms of his offer (Offer) to buy Manchester United plc (MU) and the full offer document will be sent out to MU shareholders, probably after the season has ended and the holiday season has started. SU will be reviewing the full Offer document with its advisers, and will issue its own recommendations to those MU shareholders who have not already sold to Glazer.

In the meantime, SU urges MU shareholders - do nothing with your shares until you have heard from us.

We would also urge those shareholders and supporters who have not joined SU to do so now - we are still buying shares in the market and our share scheme is a convenient, and cost-effective means of maintaining a collective stake in our club.

SU and IMUSA are continuing to work with Nomura International on the possible structuring of an investment trust to help in their drive to keep Manchester United independent and help the supporter-shareholders to secure a significant collective stake. This fight is not over.

Next steps

Glazer is currently buying in the market to achieve the 75% he needs to attempt to take the company private and leverage the company's assets with part of the debt he is taking on to buy MU. If he achieves this target, he will call a general meeting of MU to pass a special resolution to re-register the company as a private limited company, an essential legal element in his plan to transfer his acquisition debt to MU.

SU will be discussing with its legal advisers and counsel on bringing an action under s 54 of the Companies Act to apply to the court to cancel any such resolution. To mount an objection under this section, we need a minimum of 50 shareholders to object.

Glazer is reserving the right to compulsorily buy out any minority shareholders under ss 428-430 of the Companies Act if he achieves 'sufficient acceptances' under the Offer. As SU understands it, Glazer's vehicle Red Football Limited and its concert parties now own or control a minimum of 71.8% of the MU share capital - for the purposes of s 428, these shares are not included in the Offer and Glazer therefore needs to reach 90% of the remaining shares not held by him. At the present time, SU, together with its members private holdings and pledges being received from other individual shareholders, will almost certainly represent enough shares to prevent the provisions of ss 428-430 from being applied. SU will keep this situation under constant review with its advisers.

"Glazer will soon realise, if he doesn't already know, that we will not be going away quietly. He is known as a persistent and determined man who always gets what he goes for. Well he will now find that the United fans are just as persistent and determined, and they are fighting for love not money" said SU Chair, Nick Towle.

Where's the money coming from?

SU notes that the Offer is to be funded by £265 million of senior debt which will be secured on the assets of MU. This is a significant and dangerous level of leverage for a football club, as has been seen with other clubs in the recent past.

Glazer is also proposing to issue £275 million of Preference Shares to investors in his Red Football company - although these securities are expressed not to be secured on the assets of MU, it will almost certainly be the case that Glazer's stake in MU will be available to the holders of these securities should Glazer default on any obligations he undertakes in respect of redemption or other rights attaching to the securities. And of course there would be nothing to stop Glazer from refinancing these securities with additional debt which would be secured on the assets of MU.

SU also challenges Glazer to declare how much of his so-called "equity contribution" of £272 million is funded by debt. SU is given to understand that it may be as much as 100% debt funded.

In short, the massive amount of debt which Glazer is assuming to acquire MU leads to two inescapable and highly dangerous conclusions:

1. These massive debts have to be serviced, both interest payments and repayment of principal, and it seems that the revenues of MU will be the prime source of that servicing requirement. This will put huge pressure on MU to perform both on and off the pitch - some estimates believe that an additional £50-70 million per year in additional profit (over and above what MU makes now) will be needed. We ask - where is this extra revenue coming from? How can it be achieved? Look out especially for the renaming of Old Trafford and hiking of prices of everything at the stadium.

2. Any failure of Glazer's 'aggressive' and 'damaging' business plan which leads to default on the loans or securities which either he or the plc has taken on, could result in the banks and security holders taking possession of MU. Glazer appears to be risking little, if any, of his own money in this venture and the result could be that MU ends up being owned and run by the banks who are charging such huge fees for helping Glazer acquire the club.

And what is Glazer offering supporters?

Glazer's summary offer does not mention any of the promises we have read about in the press. We hear that Alex Ferguson will be given £100 million over five years, equivalent of £20 million per year.

"£20 million a year? That's less than Wigan will be spending this summer" commented SU committee member Eric Halsall.

SU continues to gather support from United fans from all walks of life. James Nesbitt, the actor and lifelong fan has generously pledged £10,000 to the cause. John Monks, trade union leader and SU patron, will be speaking out against the bid at a conference this weekend.

SU will be making a further announcement in due course on the proposed boycott by supporters of the club and sponsors products.

Johan Nilsson2005-05-14 12:30:00

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