Man Utd cash crunch explained: no investment by Glazers, poor player sales

Finance expert Kieran Maguire has explained Manchester United’s cash crunch after fans expressed their concern about the club’s spending ability this summer.

Financial regulations are biting at the Red Devils, and their budget for this summer depends more on player sales rather than a potential takeover.

Man United cannot spend more than 90% of their total income on transfers, wages and coaches and agents’ fees.

According to Maguire, while the Premier League Financial Fair Play rules allow clubs to make a loss, which is made up by wealthy owners, of £105 million over three years, the limit is £15m plus up to £90m in equity investment by owners.

Unfortunately for the Red Devils, their owners – the Glazer family – have only put in £0m in those three years, but the allowable loss is still £15m.

Their leveraged buyout (LBO) model also means they are paying out interest (which is not exempt from FFP), further constraining spending limits.

Man United also have a poor player sales record, and their frequent struggles to make a profit on that front have not done their FFP chances any good.

They are hoping to sell some players this summer, but they will not be making any profits as those available for sale have seen their values nosedive.

The Glazers have not done Man United any good in recent years, but selling the club before next season will count as one.

The takeover will not immediately improve the club’s financial fortunes in the transfer market, but it will be a much-needed step in the right direction.

Red Devils manager Erik ten Hag wants to bolster his squad this summer, with a striker top of his plans.

The Dutchman may also bring in a new first-choice goalkeeper amid uncertainty surrounding David de Gea’s future, with the Spaniard out of contract.

Man United are closing in on a £60m move for Chelsea midfielder Mason Mount, and whether they would have much left to spend afterwards remains to be seen.