UK billionaire Sir James Ratcliffe has thrown his hat into the ring, confirming his interest in buying Manchester United. He faces competition from other bidders from around the world, not least from the Middle East, where Gulf states buy up football clubs with impunity. So who is Jim Ratcliffe? By Alan Wares
Sir James Arthur Ratcliffe FIChemE was born on October 18th 1952 in Failsworth, in those days in Lancashire, now in Greater Manchester.
He is the son of a joiner and an accounts office worker. He grew up in a council house, before his father eventually ran a factory making laboratory furniture. His first job was with oil giant Esso, but he decided to broaden his skills into finance by studying management accounting, taking an MSc in finance at London Business School in 1978.
In 1998, he formed INEOS (the name is derived from INspec Ethylene Oxide and Specialities, a previous name of the business). It also incorporates one Latin and two Greek words. “Ineo” is Latin for a new beginning, “Eos” is the Greek goddess of dawn, and “neos” is Greek for something new and innovative. As well as being an acronym, Ineos states its name represents the “dawn of something new and innovative.”
From this small base, using high yield debt to finance deals, Ratcliffe started buying unwanted operations from groups such as ICI and BP, selecting targets based on their potential to double their earnings over a five-year period. In 2006 INEOS bought BP’s refining and petrochemical arm Innovene, giving INEOS refineries and plants in Scotland, Italy, Germany, France, Belgium, and Canada.
In April 2010, Ratcliffe moved INEOS’s head office from Hampshire to Rolle, Switzerland, decreasing the amount of tax the company paid by £100m a year.
In 2015, he opened the UK headquarters of the chemicals and energy group in Knightsbridge, London, along with gas and oil trading, and other functions, saying he was “very cheerful about coming back to the UK”. He was pleased with UK policy, London as a business base, and untroubled by the prospect of Brexit. Full year 2015 earnings before tax came in at €577 million compared to €253 million for 2014.
In May 2009, Ratcliffe was granted an honorary fellowship by the Institution of Chemical Engineers, citing “his sustained leadership in building the INEOS Group. He was appointed Knights Bachelor in 2018 for services to business and to investment.
In 2019, INEOS announced it would invest £1bn in the UK oil and chemical industries, to include an overhaul of the Forties pipeline system that is responsible for transporting a high percentage of the UK’s North Sea oil and gas.
In the same year, Ratcliffe criticised the Conservative government rules that say fracking in Britain must be suspended every time a 0.5 magnitude tremor is detected, which has led to a de facto ban on fracking: “I think the government has been pathetic on the subject.” Since that time, the government has re-opened the door to fracking, albeit via a method of playing politics, and the three-line whip coercion of its own MPs.
Ratcliffe’s companies invited further controversy when, also in 2019, INEOS said it would close its Middlesbrough manufacturing plant unless it is allowed to ‘defer compliance’ with EU rules designed to prevent air and water pollution. The UK’s own Environment Agency (EA) revealed that the plant invoked 176 permit violations between 2014 and 2017. An EA spokesperson said, “air emissions are well over legal limits and this poses a risk to the environment”.
In response, an INEOS director said the firm “cannot justify” the investment required to comply with EU air and water pollution rules due to come into force in the coming years. Incoming UK laws are likely to favour INEOS’ stance.
In 2021, Ratcliffe finally came on board the Net Zero movement when he announced plans to invest more than £1.7bn into electrolysis projects to make zero-carbon green hydrogen across Europe.
Given the business model of how the vast majority of football clubs are run just in order to compete, Ratcliffe will not be making another fortune on top of his very healthy pile should he succeed in acquiring Manchester United. This is unless he runs it with the express intent of self-interest over the interests of the club.
Indeed, this can be seen more as an investment of the heart, as he has revealed he is a lifelong fan of the Red Devils. As it is, he is already heavily invested in sports ownership and sponsorship.
The current owners, the Glazers, are said to be unhappy that Ratcliffe has entered the frame, as they believe his public intervention undermines the entire sale process. In making his own intentions known, the Glazers believe Ratcliffe may well use his lifelong support for the club as a lever to garner public support, and therefore drive the price down.
In their minds, he has no intention of bidding the $6 billion they believe the club is worth. One the other hand, it was reported that they originally wanted something in the region of $8.25 billion for Manchester United. This is a figure many analysts believe is way above the true value. The more realistic figure is closer to $4-4.5 billion. Ratcliffe, for his part, will undertake all due diligence into making his own assessments of the club’s value, and put in a bid he feels is more realistic.
And that is what is going to upset and annoy the Glazers. So keep an eye out for egos, claims, counter-claims and writs in the coming months.
Does Ratcliffe have what it takes to run a football club? The answer, on a mundane level, is ‘no’. But then, he has very little to do with the day-to-day running of the other sports clubs he has a controlling interest in. Additionally, very few people who made their millions and billions in other fields do know how to run a football club. It is an entirely different beast to say, running a chemicals company. Football administration is, by its very nature, a niche role, so Ratcliffe will be expected to put the appropriate people in place.
As of May 2018, he was considered the richest person in the UK according to the Sunday times Rich List, with a net worth of £21.05 billion. By April 2020, Bloomberg Billionaires Index had estimated his net worth at $28.2 billion, making him - according to them – the 55th richest in the world and second in the UK.
So coughing up for Manchester United really oughtn’t be a problem.
In September 2020, Ratcliffe officially changed his tax residence from Hampshire to Monaco, a move that it is estimated will save him £4 billion in tax.
Away from it all
Ratcliffe made expeditions to the North and South Poles, and a three-month-long motorbike trek in South Africa. In 2013, he completed the Marathon Des Sables across the Sahara Desert, and he has founded a charity “Go Run for Fun”, encouraging thousands of children aged between five and ten to get active by creating celebrity-driven events.
He founded the Jim Ratcliffe Foundation, helped build a new ski clubhouse in Courchevel to help underprivileged children learn to ski. However, the UK Charity Commission has opened a “regulatory compliance case” to investigate “concerns about the governance and management of the Jim Ratcliffe Foundation”.
Ratcliffe is a Eurosceptic. “As a business, INEOS supported Common Market,” Ratcliffe comments, “but not a ‘United States of Europe.’” Since Brexit, while opposing the ‘layers and layers’ of European legislation that he felt made European economies cumbersome, the red tape he had hoped to clear away has instead re-materialised.
On the back of this, he has publicly expressed his disdain for Government politicians – who hasn’t? – furious with them for the way they negotiated the Brexit Withdrawal Agreement, mostly as he felt industrialists were excluded from consultation in the process.
So will the hitherto ‘publicity-shy’ Sir James Ratcliffe finally get to acquire the club of his boyhood? Given the egos, lawyers, global branding and emotional investment required, this saga may well stretch a fair way into the future yet.