Burnley left ‘£90m worse off’ after recent US takeover

The deal has drawn comparisons with the Glazer family's takeover of Manchester United

Burnley's recent takeover by US consortium ALK Capital is reported to have left the Premier League club around £90m worse off, with the deal containing similarities with the Glazer family's leveraged buyout of Manchester United in 2005. According to David Conn, writing in The Guardian, new chairman Alan Pace has yet to give a detailed explanation as to how the club were bought from long-term owners, Michael Garlick and John Banaszkiewicz, who have both retained their positions as club directors. When asked by the newspaper to confirm exactly how the money paid to the club's outgoing shareholders was financed, Pace declined, citing confidentiality. Guardian sources have, however, claimed that some of the initial payments made by ALK Capital were covered by a loan from investment firm MSD UK Holdings which totalled approximately £60m. The same article adds that initial reports which claimed some of the deal was being funded by Burnley's own finances were also accurate, with around £30m to £40m being used. Factoring in Burnley's most recently published accounts, which, for the year to June 30 2019, showed it had £42m in the bank and no borrowings, Conn says it would now appear the club are approximately £90m worse off - with interest on their loan still to pay. The Glazer family completed their takeover of Manchester United 16 years ago, saddling a previously debt-free club with £525m debts. They have since used the club to pay £1bn in interest, fees and refinancing charges, which has been met with hostility from United's support. Despite being questioned on the finances involved in ALK’s takeover of Burnley, Pace has likened it to taking out a mortgage on a house. He also insists that the consortium's financial approach is sustainable.