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Manchester United Hopes To Score With Its IPO


Now, to the big business of soccer and another big public stock market debut.


ANNOUNCER: Brilliant play. Wonderful (unintelligible) for Wembley goal. For Manchester United, the nanny in a community seal.

MONTAGNE: Manchester United is the most famous soccer team in the world, and one of the most popular sports teams as well. Now, its owners are hoping the team's popularity will translate into big bucks. They're planning to sell Manchester United stock on the New York Stock Exchange.

To find out more, we called Roger Blitz. He's been looking into this for the Financial Times, and we reached him in London.

Thank you for joining us.

ROGER BLITZ: Not at all.

MONTAGNE: Now, many people here in the U.S. might not know that Manchester United is actually owned by an American family. Tell us what you know about them.

BLITZ: They are sports club owners. They own the Tampa Bay Buccaneers. They are a family whose headed by Malcolm Glazer. Malcolm Glazer is very infirm now and his six children effectually run Manchester United. They also have a lot of shopping malls in the U.S. Without question, Manchester United is the most high profile of those assets.

MONTAGNE: What exactly is their strategy? I mean, why are they doing this IPO and why in New York and why not, say, in London?

BLITZ: When they bought the club, they bought it in a highly leveraged buyout back in 2005. Ever since that, the club has been saddled with debt and that debt remains at about 650 million dollars. So the club needs to get rid of the rest of its debt so that they can buy the best players and compete. Now, that's what they say. Some of the skeptics amongst their fan base say actually what they really want to do is raise enough cash for themselves, for all their siblings, a lot of whom have carried the debt and it's in a sense it's a bit of payback time.

MONTAGNE: Well, if this club, Manchester United, is weighed down by a lot of debt, is this a good investment?

BLITZ: Well, the problem for potential investors when they read the IPO document is that there isn't that much rights they get from this. First off, there's no dividend payment. Secondly, they effectively have no voting rights because the weight of the voting shares reside with the family, and so what you're left with is an investment choice based on the eventual exit of the family altogether. The issue with that is that the Glazers have made absolutely clear that they intend to hold onto the club.

On the other hand, the Glazers would argue that the club's commercial success has been fantastic in the last few years and actually, the figures do say that. They've done extremely well on getting sponsors into the club and done exceptionally well on broadcast rights revenue.

MONTAGNE: Well, who do you think will buy shares? I mean, would that include fans who want a piece of Manchester United?

BLITZ: Any sporting entity that does decide to go for an IPO and frankly, there's not that many, is there is a lot of sense of, you know, I've followed my club all these years, I want a piece of it. But I suspect that Manchester United already have lined up investors and they come from Asia, because Asia sees football as a real growth opportunity for them. Big fans. New markets. Big television rights. And the other thing is that there's a lot of companies and a lot of investors that like the globalization of football and they like the fact that it actually opens doors to deals and networking which having a piece of a global club like Manchester United gives them.

MONTAGNE: Thank you very much for joining us.

BLITZ: Not at all.

MONTAGNE: Roger Blitz is the leisure industry's correspondent for the Financial Times.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.