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Last Updated: Wednesday, 29 June, 2005, 22:57 GMT 23:57 UK
Man Utd's turbulent business history
by Bill Wilson
BBC News business reporter

Martin Edwards
Martin Edwards took Manchester United public in 1991

Manchester United may be the world's richest football club but history shows that over the past century it has not always enjoyed a smooth financial life.

On many occasions it has only been saved from bankruptcy or other disaster by the appearance of a Mr Big who has staged a last-ditch rescue.

Now the club is in the possession of US billionaire Malcolm Glazer it has once again returned to private ownership in a tycoon's hands.

It now seems United's 14-year spell as a public company listed on the London Stock Market can be seen as an exception over the course of its history.

Although people might not think it, the club has had some real financial ups and downs over the years
Steve Kelly, author Back Page United

Back in 1902 wealthy Manchester brewer John Henry Davies took over the then Newton Heath club, and saved it from going out of existence - something hard to imagine today.

The circumstances of that takeover were also rather bizarre.

"The club was in danger of going under and decided to hold a four-day bazaar to raise cash," says Steve Kelly, author of book Back Page United.

"One of the attractions was a St Bernard dog, which escaped one night after the bazaar had closed.

"The recapturing of the dog led to the meeting between team captain Harry Stafford and Davies, who put together a consortium of local businessmen."

Together, they came up with 2,000 to save the club from bankruptcy. They paid off creditors and a new club - Manchester United - was formed in April 1902.

'Moneybags United'

Davies, who became club president, invested heavily in the development of Old Trafford, and after completion in 1910 it became one of the most important stadiums in England.

During Davies' reign the club became known as 'Moneybags United' and was censured by the League and FA in 1910 for misleading financial statements.

He died in 1927 and just four years later the club was back in financial trouble.

Interior of Old Trafford
Old Trafford has proved essential to the club's financial success

Matters reached a head over the Christmas period in 1931, with the club 30,000 in debt, and secretary Walter Crickmer was stopped by the bank from paying wages.

"Although people might not think it, the club has had some real financial ups and downs over the years, " says Mr Kelly.

"They have had quite a rocky history - however they are a big club that has always been able to attract investors."

On this occasion another wealthy tycoon stepped forward in the hour of need - this time businessman James W Gibson, who made his fortune manufacturing army uniforms.

He paid the wages, and, on 1 January 1932, took over as chairman, a position he would keep for the next two decades.

A share issue raised 20,000, and one of Gibson's other major moves was to appoint Matt Busby as manager after World War II.

'Persuasive buyer'

During the war Old Trafford was badly damaged in German bombing raids and the club faced a rebuilding job on and off the pitch, with the stadium rebuilt by 1949.

Gibson remained at the helm of the private club as major shareholder until his death at the start of the 1951/52 season.

The aftermath of the Munich air disaster
The club had to rebuild after the Munich air disaster in 1958

His son Alan inherited the major shareholding from his father but Harold Hardman was appointed chairman.

The decade of playing success was shattered by the Munich air disaster of February 1958 and as the club set about rebuilding a new director was appointed, butcher Louis Edwards.

"He then went about buying up shares from people he knew owned a holding in the club," says Mr Kelly.

"He proved to be very persuasive in convincing people to part with their shares, and he eventually took over at United."

Shares issue

With the death of Hardman in 1964 - and after six years of share buying - Edwards was elected chairman.

Edwards planned further development of Old Trafford and also launched a shares issue which raised 1m. The number of investors in the club went from 90 to 2,000.

Manchester United players Crerand and Best with manager Busby and European Cup
Manager Busby (centre) saw player wages go up during the 1960s

This allowed Busby the luxury of buying players, but at the same time relaxation of controls over player transfers brought in an era of escalating wages.

Edwards died in 1980 and his son Martin took over as chairman.

The 1970s and 1980s were comparatively lean times on the pitch for United, but their huge home attendances every season - they were the most watched club for 17 out of 20 seasons from 1972 - ensured its long-term financial survival.

Failed bids

In 1984 Robert Maxwell offered a reported 10m for the club, but his proposal was rejected.

And five years later Isle of Man-based property developer Michael Knighton came close to taking over, but one of his banking backers, Citicorp, pulled out.

Then, in May 1991 the club floated on the stock market, with 2,597,404 shares on public sale at 3.85 each.

Robert Maxwell
Robert Maxwell tried unsuccessfully to buy Manchester United

Martin Edwards came in for some criticism for the 93m-plus he made by selling his shareholding over the years, before stepping down as chief executive in 2000.

"He came in for some rough remarks," says Mr Kelly.

"But something had to be done in the light of the 1990 Taylor report which said stadiums had to be all-seater - that was going to cost a lot.

"However, the problem with going public is that someone can always buy you."

There was more drama in 1998 when a bid by BSkyB was rejected by the UK Monopolies and Mergers Commission.

Now Malcolm Glazer is the latest in a series of single-minded businessmen to take possession of the Old Trafford club, and the first from overseas.

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