Manchester United Sidesteps Financial Penalty with £40m Covid Loss Claim

courtesy of thesun.co.uk

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Expert Insights on United’s Financial Manoeuvre

Manchester United has successfully navigated the financial implications of Covid-19, avoiding punitive measures by declaring substantial pandemic-related losses. Football finance authority Stefan Borson indicated to talkSPORT that without certain “relatively exceptional” concessions, the club risked violating Profit and Sustainability Rules for the period ending last season.

United’s Covid Claim Overshadows Rivals

According to Borson, Manchester United’s £40m Covid loss claim for the 2021-22 season dwarfed those of its competitors. He highlighted the significance of this leeway, noting that without it, and the exclusion of the costs associated with Ineos’ investment in the club, United’s losses would exceed the £105m threshold permitted over three years.

League-Wide Covid Loss Claims

It’s understood that Manchester United wasn’t alone in declaring significant Covid losses to circumvent breaching Profit and Sustainability Rules. While some clubs, like United, have made these figures public through their accounts, others have chosen to keep their Covid-related financial details private.

Premier League Accepts United’s Losses

Premier League executives have acknowledged Manchester United’s £40m loss for the 2021-22 season, despite the club’s status as the highest-earning team in England. The financial strain was exacerbated by sponsors unable to fulfil payment obligations or terminating partnerships, and the absence of a lucrative summer tour in 2021.

Ineos Deal Costs Excluded from PSR

In February, Sir Jim Ratcliffe’s Ineos finalized a £1.03billion investment to purchase a share from the Glazer family. The transaction incurred £35m in fees and costs, which Manchester United asserts fall outside the scope of football-related business, thereby exempting them from Profit and Sustainability Rules calculations. It is speculated that Chelsea may have adopted a similar stance regarding their 2022 takeover expenses.

Confidentiality Surrounding PSR Compliance

The stringent confidentiality associated with Profit and Sustainability Rules means that the intricacies of clubs’ financial dealings only surface if a charge is brought against them. Nevertheless, a spokesperson from United confidently stated, “We’re fully compliant with the PSR rules.”

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