NEW YORK: Manchester United, the English soccer club with a record 19 championships, raised US$233.3 million in its US initial public offering, pricing the shares below the marketed range.
The 134-year-old team and the Glazer family that bought it in 2005 sold 16.7 million shares for US$14 each, according to a statement yesterday.
They had offered the shares, equivalent to a 10% stake, for US$16 to US$20 apiece. The club will start trading today, listing on the New York Stock Exchange under the symbol MANU.
The IPO gives the Glazer family’s team an enterprise value of US$2.9 billion, about $1 billion more than the value of Spain’s Real Madrid, according to data compiled by Bloomberg and Forbes. Increasing competition from other teams for fans and corporate sponsorship and an expensive debt load may weigh on earnings, said Morningstar Inc’s Kenneth Perkins, who values the stock at US$10 a share.
The company “was asking investors to pay a pretty high price and take on a lot of risk,” said Perkins, a Chicago-based analyst who covers consumer companies. “It could work out, but the risk is to the downside.”
The Glazers will maintain almost 99 percent of the voting control, according to the original terms of the prospectus, because the Class B shares they own carry 10 votes apiece, compared to 1 vote each for the Class A shares being sold in the IPO. The Glazers sold half of the shares offered, while the company sold the rest, and planned to pay down debt with the proceeds. (Bloomberg/tw)