How Sir Jim Ratcliffe’s INEOS took economic control of Manchester United

When Sir Jim Ratcliffe’s INEOS first agreed a $1.3bn deal to acquire a little over a quarter of Manchester United, the initial guidance was that the billionaire’s scope of control would extend only to management of the club’s football operations.

Headed up by its director of sport, Sir Dave Brailsford, INEOS has assembled a multi-sport empire focusing on performance across football, cycling, Formula One, rugby and running. It was expected, therefore, that INEOS’ role at Old Trafford would, essentially, be confined to selecting the sporting director and head coach, overseeing training ground culture and innovations, and revamping the approach United take towards recruitment, after a litany of poor signings in the transfer market since Sir Alex Ferguson retired from the club in 2013. The club’s business and commercial operations, and the pursestrings, would remain under the Glazer family, who retained economic control of the club.

Yet in January, before the deal had even passed through all its regulatory checks, it became abundantly clear that INEOS had bolder and broader aspirations. At an all-staff meeting at Old Trafford on January 24, interim chief executive Patrick Stewart informed employees that INEOS and the Glazer family had reflected on previously agreed arrangements and told colleagues the scope of INEOS’ work may in fact far be more substantial.

Ratcliffe’s team had swiftly concluded that business decisions and competency at a football club in turn impact the football operations, while INEOS was also to lead the deliberations as to whether United refurbish or rebuild Old Trafford. Dividing up responsibilities as originally envisaged now seemed implausible. In the corridors of power, United executives wondered how the front office would shake out. Would the club be heading for an awkward partnership, where some key executives are loyal to the old regime and some are recruits from the new investors?

At 9.15pm UK time Tuesday, we received an answer when United announced that Stewart, along with the club’s chief financial officer Cliff Baty, would both leave the club at the end of this season.

That Stewart is leaving his role is unsurprising, because United have already recruited Omar Berrada, the Manchester City chief operating officer, to be their new chief executive from this summer upon the completion of his notice period. What is peculiar, however, is the fact United appointed Jean-Claude Blanc (a former chief executive at PSG and the CEO of INEOS Sport) as the club’s interim chief executive to replace Stewart in the weeks between the end of the campaign and when Berrada assumes power on July 13.

Blanc, United’s latest interim CEO, with Dave Brailsford and Ratcliffe at their other football club, Nice (Photo: Jean Catuffe/Getty Images)

This means United have an interim chief executive to replace an interim chief executive, when it may have been more natural for Stewart to remain until Berrada arrives. The inevitable speculation, therefore, is whether a strain had enveloped the relationship between Stewart and INEOS and if Stewart may have been reluctant to implement the pace of change his new employers truly desire. It will also be interesting to see whether Stewart actually works day-to-day until the end of the campaign, or whether he is just paid up and Blanc assumes power earlier.

Baty, however, is arguably the more interesting exit, at least in the fact that his replacement Roger Bell was until recently the chief financial officer of INEOS Sport. This tells us that the Glazer family have now outsourced the financial and football management of the club to people in INEOS’ circle. Bell posted on Linkedin at the turn of the year he was retiring after 40 years with INEOS to pursue a “change in direction”.

Joel and Avram Glazer, the foremost of the siblings and co-chairmen of United, have entrusted Ratcliffe with the management and responsibility of the club in the hope that the British billionaire can do a better job in bringing commercial and on-field success than they, as a family, have managed to do over the past decade. All three were present at Wembley for United’s nervy penalty shootout victory over Championship side Coventry City in an FA Cup semi-final on April 21, while Joel and Avram visited the club’s London office in the build-up to the game.

The Glazers, of course, retain the greater shareholding and could, in theory, take back control at any point but for now, the relationship is being described as a harmonious one, whereby the family lends entire operational control to Ratcliffe. And there is nothing more symbolic than claiming control of United’s finances; meaning INEOS now has its own man handling approvals on player trading, contract renewals and all money going in and out of the club. There does not appear to be any Glazer-appointed stopgap to intervene on behalf of the majority owners. For the Glazers, it looks a pretty sweet deal; if United return to success on the field, the value of the club (and their shares) rises, while if they fail, much of the blame will be targeted at Ratcliffe (who will also have paid $1.3bn for the privilege).

The victims of this radical transition are proving to be the executive leadership team (ELT) that was in place under the Glazers before INEOS acquired a stake. Since November, the chief executive Richard Arnold, the football director John Murtough, the CFO Baty and the interim CEO have all fallen by the wayside. Phil Lynch, the club’s CEO of digital products and experiences (also a member of the ELT) has also resigned, heading to rival Premier League club Chelsea. They all share in common ties to the previous regime, or the Glazers, with Stewart the club’s chief legal counsel since 2006, while Baty has been CFO since 2016. Stewart, it should be said, was offered to stay at the club if he wished to revert to his legal role, but has declined to instead pursue a career in sports business.

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Arnold was presented with his seat from Old Trafford as a leaving gift (Photo: Gongora/NurPhoto via Getty Images)

Stewart and Baty represented United at the Premier League shareholders’ meeting at The Churchill hotel in London on Monday, where the club were one of three to vote against a spending cap proposal that passed.

In a statement on Tuesday night, United insisted the decisions had been made by “mutual consent” but in the words of one employee, a Game of Thrones has developed behind the scenes as INEOS has sought to overhaul United’s operations in recent months. United’s ELT had long been anxious about INEOS in any case, stretching back to the very first meetings when Ratcliffe came to visit Old Trafford as a potential bidder and made clear in no uncertain terms where he believed the club to be failing. The meetings with the Qatari bid fronted by Sheikh Jassim were more reserved and left United’s executives hopeful of trust beyond a potential acquisition.

The glut of exits began with Arnold in November but this was actually less to do with INEOS and far more to do with his relationship with Joel Glazer, which had broken down and the pair were barely on speaking terms by the end of Arnold’s reign. Arnold had previously irritated both Glazer and Ratcliffe, however, when he was among those to push back against one of the first Ratcliffe proposals to buy into the club, which would have rewarded only Class B shareholders — stock held exclusively by the Glazers.

That offer provoked the threat of litigation from those in possession of Class A shares, the type traded on the New York Stock Exchange, which is why Arnold raised concerns. His exit was mourned by some but not others. Many staff members in the room were baffled and exasperated in September when Arnold claimed in an all-staff meeting that United were “chasing down” Manchester City, despite the two clubs rarely seeming further apart on the field, and Arnold’s seeming complacency appeared to embody a feeling among his executive team that United were headed in the right direction.

Others were more upset, as CEO of alliances and partnerships, Victoria Timpson, insisted staff in the club’s London office give Arnold a round of applause — despite him not actually being present — when news of his exit emerged. At the club’s Christmas party, which doubled up as a farewell to Arnold, quite a few staff members were barely listening as he received his (literal) seat from the club’s director’s box as a leaving present.

More recent exits, however, have come about as a result of INEOS’ tightening grip on the club. Murtough was essentially left redundant after the club moved to recruit Dan Ashworth as sporting director from Newcastle (subject to arbitration proceedings) and Jason Wilcox as technical director from Southampton. Stewart was never going to remain as interim CEO once Berrada arrived, with the executive recruited for his blend of commercial savvy and experience in football transfers negotiations.

In recent months, INEOS sought to shake up United’s working environment. They are unhappy, for example, that the club made £648.4m in revenue for the year end June 30, 2023, only to still contrive to lose over £42m. INEOS believes a revamp of the club’s method of recruiting footballers will go a long way to improving this but the consultancy Interpath was also enlisted to review costs across the club.

This has led to significant decisions that impact certain staff members; such as one to take company credit cards away from staffers, while last week staff members discovered they would have to pay £20 if they wished to travel on a club-provided coach to the FA Cup final against Manchester City at Wembley on May 25.

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United made it to the FA Cup final but staff have lost some of their perks for the game (Photo: Richard Heathcote/Getty Images)

It is a club tradition that the club’s workforce are offered a complimentary ticket, which has been retained, but now they are asked to contribute to the journey, while there will also be no free food along the way this year. More significantly, INEOS appears to be taking a view that United’s workforce, the largest of any English football club, is bloated, which is creating insecurity and concern among the rank and file. Staff members, many of whom are paid everyday wages, are anxious as to whether they will be able to keep their jobs, some are questioning if the club’s bonus scheme will be retained this year or if they, too, will fall by the wayside.

Stewart and Baty, as interim CEO and as CFO, had been tasked with overseeing the implementation of these cost controls. This may, down the line, have led to them needing to lay off people they know well or personally recruited. More instantly, however, eyebrows had been raised when United’s SEC filing, upon completion of the minority stake, revealed that both men had received completion bonuses equal to two times their annual salary.

This privilege, afforded to the pair as board members but not extended to every other member of the ELT, did not delight all their peers, many of whom had worked long hours on the strategic review but had been left without a payout. On top of that, the two men that had cashed in were now implementing a clampdown on expenses and cost controls. This is just a snapshot of the agitations; further anxiety dawned when The Athletic reported how INEOS intends to hire a chief business officer, once again reinforcing how Ratcliffe has claimed full operational control.

As INEOS takes a sledgehammer to the Glazers’ executive team, there does not appear to be too much concern about whether they upset people along the way. Indeed, some have been left with the impression INEOS may even prefer them to be looking elsewhere. INEOS, for its part, believes the shock therapy it is implementing at Old Trafford is necessary; it believes the atmosphere has been too comfortable, where people are happy in their jobs even when the club is losing money off the pitch and losing games on the field.

Its message is clear: the future has to be different from the past. For staff members, there is still optimism at what United may become under the ambitious and decisive leadership of Ratcliffe, but they are also realising that change can be good for some and traumatic for others. Staff members knew something was afoot on Tuesday afternoon, when they received an email telling them that Ratcliffe would be addressing an all-company meeting on Wednesday lunchtime.

The ruthlessness in the boardroom, however, is juxtaposing with the extensive deliberations over Erik ten Hag’s future as Manchester United manager. Ten Hag’s contract is up in the summer of 2025 and an appalling season in the Premier League and Champions League has left the Dutchman vulnerable to change. But he is helped by INEOS’ view that United’s executive team above him has not provided him the greatest chance to succeed, as well as a lack of clear alternatives and also the cost of firing him and hiring a replacement.

For now, United continue to insist they are planning with Ten Hag in mind for next season. Yet as his previous superiors have discovered, INEOS will not hesitate if it sees sufficient evidence that change is needed.

(Photo: Crystal Pix/MB Media/Getty Images)

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