Outlook 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.
It is true that Man United enjoys huge support across Asia, but its successes in monetising that support have been modest so far. Its most recent results reveal that matchday income and media rights (mostly UK and European) account for two thirds of its turnover – there is no breakdown of its other commercial sales, but it is fair to assume much of those are here too.
The problem with London, however, is that it has plenty of experience of publicly listed football clubs and almost none of it is happy. A wave of football flotations over the past 20 years have seen investors lose money, the market knows how performance on the field – which is so unpredictable – can cause havoc to the bottom line, and the industry's financial precariousness is a national talking point.
The LSE has played host to its fair share of over-priced rights issues over the years. Still, it is difficult to imagine investors here being prepared to pay the mooted $1bn for a 25 to 30 per cent stake in a business that is loss-making after the costs of servicing its debt unless star players are sold.
Then there is the political factor – the green and gold campaign of the Manchester United Supporters Trust has been less vociferous this year, but would no doubt resurface in the run up to aLondon flotation, muddying the waters for the IPO still further.
Asia, then, looks more promising, particularly as the Glazers need the highest valuation possible – for the sake of the money itself, of course, but also to justify the short shrift given to the Red Knights, the group of wealthy businessmen who held discussions a year or so ago about bidding £1bn for the club.
However, Man United is still picking its market carefully. Singapore now appears to be the club's favoured destination, which looks rather Championship compared to the Premiership that Hong Kong, previously expected to be the IPO venue of choice, would represent. But then Hong Kong's listing rules are more exacting, especially when it comes to the requirements for recent financial performance.
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