Rates go up on United debt

As expected the interest rate on the Glazers' pik loans has gone up from 14.25% to 16.25% after penalty clauses were triggered.    Under the terms of the loans, Manchester United's net debt-to-earnings ratio was supposed to be kept below a multiple of five until a test date five years after the first refinancing.   Net debt of £663m is now more than six times last year's earnings of £109m.

Piks were a form of loan that were typical of the financial boom.  What concerns United fans is that when bank loans were replaced with a high-yield bond last January, the Glazers were given the right to take £70m from the club's funds.   Some claim that the owners' wider business is not doing well and Manchester United, which is a highly cash generative business, is being used to prop up their other interests such as their American shopping mall business.