Manchester United Singapore flotation given go ahead

By David Gold

September 16 – Manchester United’s partial flotation on the Singapore Stock Exchange has received the go ahead, following the confirmation by the club last month that they intend to raise capital through selling shares.

With the club having a debt of £308 million ($499 million/€349 million), its owners, the Glazer family, hope to raise significant sums by offering up to 25 per cent of the club on the stock market.

No precise details have yet been given, but they have indicated they will partly use the money raised to reduce the debt.

At the start of this month, United announced record revenues of £331.3 million ($537 million/€376 million), making them a tidy £30 million profit ($48 million/€34 million).

It was the first time they had made a profit after debt payments since the Glazer family bought the club, and was in part made possible thanks to the owners paying off some of the loans they took out to buy the English outfit in 2005.

The decision to float in Singapore has raised eyebrows, with those who know the markets suggesting that it asks fewer questions than other exchanges, such as in London or even Hong Kong, where United were also thought to be looking at earlier this year.

The timing of the flotation is also intriguing in the light of the sovereign debt crisis, which is threatening the future of the Euro, making growth in the US and the UK an uncertain backdrop to United’s decision.

Any repeat of the financial crisis that struck between 2007 and 2009 would hit the Glazers hard, as they have a number of shopping malls, which were remortgaged before the credit crunch, and these liabilities caused their debts to soar in the following years.

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