LONDON - The de facto title of the world’s most valuable sports team is about to be bequeathed to Manchester United, with the pricing of their initial public offering set to be revealed on Thursday. The club announced last month that they would float their shares in New York, culminating in a successful two-week sales effort by Wall Street bankers, as shares are expected to start trading on the stock market tomorrow.
A reasonable estimate would see United worth around $3bn (£1.92bn), about twice the value of Spain's Real Madrid once debts are factored in, according to data compiled by the financial media groups Bloomberg and Forbes. This offer would also make United worth 10 times as much as publicly traded European clubs such as Juventus.
Wall Street sources said that the United share offer has been oversubscribed by investors, although it is not yet clear what price they agreed to pay. "The book is looking pretty solid," one source confirmed. "It's covered."
All in all, the Glazer family is hoping to raise up to $332 million by selling 16.6 million shares at a range between $16–20 a share. Half the proceeds of the sale will go towards Manchester United's £437 million debt, while the other half will go directly to the Glazers, despite previous promises to use all cash raised to improve the club's balance sheet. The controlling family has also retained an option to sell a further 2.5 million shares, potentially giving them a further $50 million surplus.
Demand for the shares has been particularly high among US investors, as predicted, who have sided with a sales pitch that they are investing into a "luxury brand" and who appear unaffected by the dissenting voices who argue the offer overvalues the club. The investor RoadShow, which saw United's team of 13 investment banks meeting their clients to sell them the shares, has also touched down in Asia as well as Europe, a leg of the trip that involved the bankers visiting investors in London this week.
Apart from raising money for the Glazers and the eradication of the club's debt, a flotation will achieve the further aim of giving the club a financial valuation which the Glazers will need if they are to cash in their investment by selling the club. It is understood that previous discussions with potential buyers have been sandwiched by the gulf between the valuations of the prospective purchasers and the one put on the club by the Glazers. It is hence generally understood that a stock market flotation would end these debates.
On another note, Paris St Germain said they had agreed a deal with São Paulo for the transfer of the midfielder Lucas Moura. The 19-year-old, an extremely sought-after winger linked with United, will remain with the Brazilian club until January before linking up with Carlo Ancelotti's side on a four-and-a-half-year deal.
A reasonable estimate would see United worth around $3bn (£1.92bn), about twice the value of Spain's Real Madrid once debts are factored in, according to data compiled by the financial media groups Bloomberg and Forbes. This offer would also make United worth 10 times as much as publicly traded European clubs such as Juventus.Wall Street sources said that the United share offer has been oversubscribed by investors, although it is not yet clear what price they agreed to pay. "The book is looking pretty solid," one source confirmed. "It's covered."
All in all, the Glazer family is hoping to raise up to $332 million by selling 16.6 million shares at a range between $16–20 a share. Half the proceeds of the sale will go towards Manchester United's £437 million debt, while the other half will go directly to the Glazers, despite previous promises to use all cash raised to improve the club's balance sheet. The controlling family has also retained an option to sell a further 2.5 million shares, potentially giving them a further $50 million surplus.
Demand for the shares has been particularly high among US investors, as predicted, who have sided with a sales pitch that they are investing into a "luxury brand" and who appear unaffected by the dissenting voices who argue the offer overvalues the club. The investor RoadShow, which saw United's team of 13 investment banks meeting their clients to sell them the shares, has also touched down in Asia as well as Europe, a leg of the trip that involved the bankers visiting investors in London this week.
Apart from raising money for the Glazers and the eradication of the club's debt, a flotation will achieve the further aim of giving the club a financial valuation which the Glazers will need if they are to cash in their investment by selling the club. It is understood that previous discussions with potential buyers have been sandwiched by the gulf between the valuations of the prospective purchasers and the one put on the club by the Glazers. It is hence generally understood that a stock market flotation would end these debates.
On another note, Paris St Germain said they had agreed a deal with São Paulo for the transfer of the midfielder Lucas Moura. The 19-year-old, an extremely sought-after winger linked with United, will remain with the Brazilian club until January before linking up with Carlo Ancelotti's side on a four-and-a-half-year deal.
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