The current debt markets crisis means that Sheikh Jassim bin Hamad Al Thani’s debt-free bid for Manchester United could be perceived more favourably than Sir Jim Ratcliffe’s.
The Peoples Person reported that both Ratcliffe and the Qatari are expected to table their second bids on Wednesday.
These proposals are coming after both parties held positive talks with senior Manchester United officials last week after visiting Old Trafford.
The Telegraph reports that Sheikh Jassim is very confident that his offer is the best one and that he will be successful.
“Sheikh Jassim bin Hamad Al Thani is “very confident” his debt-free bid to buy Manchester United will win over the Glazer family as the £5 billion takeover battle enters its defining stage,” the outlet claims.
“The British billionaire Sir Jim Ratcliffe is still expected to table a rival bid but the Qataris are now of the firm belief they have the upper hand in what would be a landmark deal.
“A crisis in debt markets in the wake of the Swiss banking crisis will only add to the appeal of the only bidder not reliant on financing, City insiders believe.”
It is only the Qataris who are known to be able to do a deal without Wall Street lending of some sort and they believe they are on a very strong footing. Goldman Sachs and JPMorgan Chase and Co are understood to be helping bankroll Ratcliffe’s offer with bonds and loans beyond the value of United’s existing gross debt of £680m.”
The Telegraph points out that despite Ratcliffe being a safe bet in terms of loans and him having an impressive track record of making successful investments, the crisis means that investment banks are extremely wary about suffering losses.
This comes after Credit Suisse was taken over by one of its biggest rivals in Switzerland bank, UBS. Credit Suisse recorded its worst loss since the global financial crisis. Shares fell 25% over the week, with panic-stricken account holders making withdrawals of up to $10 billion per day. An emergency $54 billion loan from the Swiss National Bank failed to contain the situation.
Credit Suisse’s disaster caused a meltdown across the global financial sector, hence the UBS takeover to stop the bleeding.
However, The telegraph notes that “sources close to the billionaire [Ratcliffe] were dismissive of the prospect market conditions could in any way hamper his bid.”
Ratcliffe recently acknowledged that he will not be bullied into paying a “stupid” price for United and if the terms are not right, he will walk away.
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