Manchester United prepares Singapore float

17th August 2011

Credit Suisse has been appointed to prepare for the float which will aim to tap into the club's strong fanbase in Asia, the report adds, with a stake of between 25% and 30% available. The club is valued at more than £2 bn.

The Glazer family's ownership of Manchester United has brought unprecedented success on the field and loud protests off it, adds the Guardian. The future intentions of the Glazers, who took the club private after they bought it in a deal that valued it at £790m in 2005, have long been the subject of speculation.

But why is Man Utd considering floating in Asia, asks David Prosser in The Independent?

He says: "So why is Manchester United considering an IPO in Asia rather than the UK, where it was listed on the London Stock Exchange until 2005? Assuming the club goes ahead with the float, the answer will presumably be that Asia represents a hugely attractive market for the club, which reckons the continent is home to two-thirds of its 300 million-strong fanbase.

"The more honest answer, however, would be that the Glazer family knows it would not get anywhere near as much money for the stake it wants to sell off were it to go for an IPO in London."

A Reuters report adds: "The English Premier League club, de-listed from London's stock exchange in 2005 when it was bought by the American Glazer family, is now saddled with a debt pile that has led to a vilification of the Glazers among fans.

"It has also left United in danger of struggling to meet "Financial Fair Play" rules put forward by soccer's European governing body UEFA.

"And while the Glazers have made it clear they have no intention of selling, a flotation in Singapore makes perfect sense on many fronts: it will help reduce the debt burden; it targets Asia's strong economic and investing growth and, crucially, it will deepen United's links with a region ripe for expanding its powerful global brand."

The Premier League champions hold around £500m in bond debt. They acquired this in 2010 when the Glazers launched a bond issue to pay off existing loans taken out to facilitate the leveraged buyout.

The bond issue prompted protests from some supporters because it showed the extent to which the Glazers had funded the interest payments from the club's cashflow and built in the ability to draw dividends in future.

The club's results are due in October, when it will be expected to clarify its future plans to bondholders.

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