Inquiry is unlikely to satisfy Irish pair

In the language of the sport that prompted the increasingly bitter dispute between Sir Alex Ferguson and his former friends, John Magnier and JP McManus, the final furlong remains a long way off but the Irish horseracing magnates clearly have the whip hand.

This reality was finally recognised by Manchester United plc yesterday as it gave ground in what is likely to be a vain attempt to placate their major shareholders. Following the latter's request for an investigation into several transfer issues, including the alleged payment of £139,000 to a business associate of Ferguson's son, Jason, in the signing of the goalkeeper Tim Howard, the board announced an "internal review" of transfers.

It also emphasised that Ferguson, who fell out with Magnier when the Scot sued for half the stud rights of the stallion Rock of Gibraltar, has no involvement in the financial aspects of transfers but simply "recommends purchases and sales".

This, though, will not be sufficient for Magnier and McManus who, through their investment vehicle Cubic Expression, own 25.49 per cent of the club. They want an independent and external enquiry.

After yesterday's development they will wait until the nature of the internal review, due to be completed before the next transfer window in June, becomes clear. If, as seems certain, it fails to satisfy their desire for Ferguson's blood, they will press for an Emergency General Meeting. This will be a formality given their holding; any individual, or group, possessing 10 per cent of shares can call one.

The Irish are also watching carefully developments in Ferguson's contract negotiations. The United manager has been offered a contract extension until 2007, by which time he will be 65 years old. Negotiations are close to being concluded. However, Magnier has intimated that he will only accept Ferguson being awarded a one-year rolling contract. Anything more and, again, he will force an EGM.

Cubic Expression may then seek to depose the board, whose members' combined holding is only three per cent of the club and whose reputation was badly bruised by its hamfisted response to Rio Ferdinand's failure to take a drug test. This will need the support of other shareholders and so may not be achievable.

However, Magnier could still cause problems as his holding entitles him to insist on a boardroom seat with its concomitant influence and access. If he feels it necessary to go further, his wealth would enable him to mount a takeover.

Should Cubic Expression overthrow the board, it is unclear what their subsequent plans are or, indeed, if they have any. They have never given any indication of wishing to run the club and have so far avoided taking their holding over the 30 per cent which, under City rules, would trigger an enforced takeover bid.

The board is in an invidious position. Yesterday's development, which is likely to have upset Ferguson, confirms its recognition that Magnier cannot be ignored but it appears that nothing will satisfy him short of Ferguson's humiliation either by his dismissal or through a grovelling apology.

Pursuing the former option might, given Ferguson's success, seem foolhardy for a major shareholder but Magnier knows United would have little trouble attracting a high-calibre successor. The club is on a strong financial footing and the team remains a potent one with Ferguson's current overhaul of the squad showing early promise. Very few managers - from Sven Goran Eriksson to Ottmar Hitzfeld - would not be tempted.

Whatever the quality of his successor, dismissing Ferguson would infuriate the supporters, who have made clear their backing for the manager at the weekend. Shareholders United, a pressure group of mainly minor shareholders, said "it would be a disgrace" if Ferguson was ousted as "part of a blatant and shoddy character assassination plot". A similar sentiment, expressed in blunt Anglo-Saxon, was voiced by the away support during United's match at Northampton.

In the modern game the supporters are, however, minor players. When United became a plc they left themselves open to this type of attack. Moreover the City will not welcome the feud's prolongation, especially as there is every indication that the leaks will get much dirtier and more personal.

Already there is a personal element with Jason Ferguson's role as an agent being singled out. It has been suggested that Ferguson had previously been warned off deals involving his son after earlier allegations of a conflict of interest.

However, it is claimed the Howard deal resulted in commission ultimately finding its way to Elite Sports Group, the management company Ferguson Jnr is associated with. Ferguson Snr is fiercely protective of his family and highlighting this will have angered him considerably.

Other transfers Magnier would like investigated also allegedly involved Elite, while in the case of Louis Saha the inquiry is partly one of mystification as to why £750,000 was paid to agents when the player was clearly desperate to join United. Look again at that figure: £750,000. Northampton Town were doing cartwheels at the £400,000 their Sunday FA Cup tie with United brought them.

Ferguson is not the only manager to have a son who acts as an agent. Nor are United the only club to pay huge commissions. They are, though, the only one to have a billionaire shareholder so intent on discovering evidence of malpractice that he hired the Kroll investigative agency to uncover it.

United's response statement noted that all financial aspects of transfers, from fees to wages, are conducted by the plc board under the chief executive, David Gill. Ferguson, it noted, was not a director of the plc or football club. Transfers, it added, were conducted in accordance with the regulations of the Football Association, Fifa, the world governing body, and the FA Premier League. Full disclosure was made to the latter body and will, in future, also be made to the Stock Exchange. The club said it believed its "processes and policies [were] among the most rigorous in football". It added: "Although the media have reported various allegations, Manchester United has received no documentary evidence from any party to support these allegations."

It seems Magnier intends to keep looking until he finds some.