Manchester United Reveal IPO Terms, New Shirt Sponsor
July 31, 2012
(WFI) The owners of Manchester United will only use half the proceeds of the club’s flotation on the stock market to reduce its debts, reports revealed Tuesday.
At least some supporters aren't too happy with Tuesday's move from the Glazers. (Getty Images)
The club, who are owned by the American Glazer family, launched its initial public offering on the New York Stock exchange, and shares will cost between $16 and $20.
“Manchester United today commenced its initial public offering of 16,666,667 Class A Ordinary Shares,” said a Tuesday statement from Sard Verbinnen & Co, the public relations firm enlisted by the club for the IPO.
“Manchester United is offering 8,333,334 Class A Ordinary Shares and the selling shareholder is offering 8,333,333 Class A Ordinary Shares. The underwriters have an option to purchase up to an additional 2,500,000 Class A Ordinary Shares from the selling shareholder.
“The Class A Ordinary Shares will be listed on the New York Stock Exchange and will trade under the symbol ‘MANU’.”
Each of the Glazers and the club will be selling half the IPO shares in an offering that could raise as much as $333 million. The club's proceeds from the IPO will then be used to reduce its debt of $664 million, as of March 31, to $543 million.
However, the move has been met with fierce opposition from Manchester United supporters group MUST, who have been long-standing critics of the Glazers.
“Supporters are going to be very angry about this,” MUST chief executive Duncan Drasdo said. “The Glazers have already cost United more than 550 million pounds in debt related fees and now another slap in the face as they help themselves to half of the proposed IPO proceeds.
“Clearly, this has nothing to do with benefits for Manchester United and is all about giving the Glazers quick access to desperately needed cash at the expense of our football club.”
New Shirt Sponsor
On the same day, United announced that Chevrolet is to become the new shirt sponsors for the team in a seven-year deal.
The US-based car company will become the fifth shirt sponsor in the club’s history beginning from the 2014/15 season when the current deal with Aon expires.
Chevrolet is already the official car partner of the club – a factor pointed out by United’s commercial director Richard Arnold in a statement on the club’s website.
“This is a fantastic, long-term deal for the Club. We have been partners with Chevrolet for only six weeks, but already they have produced some fantastic ideas that will benefit both the partnership and our 659 million followers around the world.
“They are a key partner on our current tour, and I know they have enjoyed experiencing the buzz generated by our fanatical support and the sell-out crowds in South Africa, China, and Europe.”
The statement also says the deal was signed for “an undisclosed amount” while the club still have yet to publish their end-of-season accounts.
By INSIDER’s Christian Radnedge
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