What Europa League success means to Man Utd

by | May 19, 2017 2:30 am



Since missing out in the prestigious and money spinning Uefa Champions league actions in 2015, the Premier league topside, Manchester United can’t wait to get back to action and cash in the money for playing at the biggest club competition.

Jose Mourinho tutored United side stands to pocket a whooping sum £60.5 million for winning the Europa League title.

United’s players and coaching staff could bank the biggest players’ bonus pool in history but they will have to survive Ajax onslaught in the final match in Stockholm on Wednesday May 24.

Again, the Europa title automatically seals United place for next season Uefa Champions League, a competition that activates an Old Trafford pay policy that sees the majority of United’s players net a 25% wage increase (a combined £38 million).

United players would also split a £1 million bonus under a performance-led incentive.

Currently, players contracted to United are subject to an assumption that the club always participates in the Champions League. Failure to reach the competition results in a 25% pay reduction.

As the club missed out on the competition last year, an approximate £28 million worth of wages were trimmed from 22 playing contracts last summer, though new signings like Paul Pogba and Zlatan Ibrahimovic were exempted.

Should Ajax take the day against United and lift the Europa League trophy, record signing, Pogba and Ibrahimovic are likely to get a wage cut.

But most definitely, the players will likely be contemplating a victory knowing what they stand to benefit from the win.

Failure to win the Europa league final could cost United £21m in sponsorship deal.

The club also stands to miss out if it does not return from Stockholm with the title next week.

The club confirmed on Tuesday they will miss out on 30% of their kit sponsorship revenues for next year if they don’t qualify for the Champions League.

Last Sunday’s 2-1 defeat at Tottenham dented United hope of finning in the Premier League’s top four this season, leaving the clash with Ajax in Stockholm on May 24 as their only avenue into the Champions League for 2017-18.

Cliff Baty, United chief financial officer, confirmed on Tuesday that the terms of United’s kit deal with Adidas mean they will miss out on 30 per cent of their potential £70m annual revenue should they fail to appear in the Champions League next term.

“It’s a 30% reduction in the following year’s payments,” Baty told an investors’ call after the release of United’s financial figures for the third quarter of the financial year. “So receipt of sponsorship next year from Adidas would be £70m if we’re in the Champions League, so that would be 30% of that, so £21m reduction.

“The important thing to remember about that is it’s spread out over the remaining life of the contract.”

The CFO added that the hit taken by the club this season due to the lack of Champions League football has been tempered not only by clauses in players’ contracts but also by the underperformance of the other English clubs playing in the Europa League.

“Clearly the Champions League has greater revenues, but we have designed an offset within salary costs and our bonus structure which attempts to damage the impact between being in the Champions League and being in the Europa League,” he explained.

“In the Champions League we’d expect to get about £40m-£50m revenues whereas the Europa League is normally around £15m-£20m revenues. This year we have benefitted from the performance of other English teams in the Europa League.

Baty also said that United’s overall debt has remained the same in real terms despite figures released this week showing the total amount owed at £366.3m. The £17.6m rise on last year’s total is said to be primarily as a result of the strength of the US dollar against the pound following the Brexit vote in the UK in June 2016.

 

Anthony Nlebem

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