Manchester United's IPO price was slashed yesterday owing to bearish assessments from analysts and ongoing concerns about capital markets.
The club had its shares priced at $14 (€11.4) each, below the $16-$20 range it had hoped. The deal values the club at $2.3bn, well below the $3.3bn it had hoped for, and reducing the proceeds for the team and its owners the Glazer family by as much as $100m.
The Glazers, who also own American football club Tampa Bay Buccaneers, bought Manchester United in a leveraged buyout in 2005. The company's debts currently stand at £437m, and the owners are planning to allocate only half of the IPO proceeds to paying down debt, which fans have criticised as they believe that the club's debts are preventing it from investing in players. The club will begin trading on the New York Stock Exchange today.
This is the Glazer family's third attempt at realising their investment, having shelved previous efforts to sells shares in the club on exchanges in Hong Kong and Singapore. In addition, Morgan Stanley left the underwriting syndicate owing to disagreements over the valuation.Picture: Source