A share in one of the world's most storied football clubs is once again up for grabs. The Glazer family's flotation of 10 per cent of Manchester United on the New York Stock Exchange today marks the end of a long and bumpy road.
The family, which took the club private in a £790m leveraged buyout in 2005, explored a float in Singapore and Hong Kong last year, but were forced to retreat in the face of weak demand. And the New York share issue had to be delayed because of market volatility last month. At one stage, it looked like the whole deal might be shelved.
But now the sale is finally away. So what does it mean for investors, for fans and football itself? Commentators have tended to analyse the float either from the perspective of the shareholder or the supporter. And neither is a pretty picture. The Glazers have pushed through an aggressive valuation for the shares. The $18-$20 price puts a value on the entire club at around $3bn, around 26 times the club's annual earnings. Analysts have pointed out that an established media company such as Disney is only presently valued at just 10 times earnings.
Although the Glazers will probably offload the shares at their demanded price, attention will quickly turn to the level at which they trade in the market. Facebook shares are down by almost 50 per cent since the social networking site's much hyped floatation earlier this year, leaving early investors feeling conned.
Some have suggested the only financial logic for buying the shares is that the club could be targeted by a wealthy private investor who will have to buy out all the equity holders at a premium to secure the prize.
If the Glazers' promises of capital gain do not materialise in the coming years, new shareholders will not have an opportunity to influence the running of the club. The brothers have put in place a two-class voting structure which means the family retain almost total control through B shares that have 10 times the voting power of those that are publicly traded. Manchester United shareholders will buy risk without control.
It is one thing for someone like Rupert Murdoch, who built his News Corp business from almost nothing, to treat shareholders as second-class corporate citizens. But the Glazers did not found Manchester United. They used money borrowed from bankers and hedge funds to acquire the club when it was already one of the most successful sporting institutions in the world.But what stinks even more than the rough treatment of gullible shareholders to many of the club's fans, including this one, is the fact that a sporting institution – one of Britain's most treasured community assets – is being relentlessly milked for the private profit of a single family.
The Glazers had initially suggested that the new money raised from this float would be used to pay down debt that the family heaped on the club after the 2005 buyout. At the last count, this stood at £437m, a bigger debt burden than any other in English football. But it has since emerged that half the proceeds from the share sales will go in to the Glazers' personal pockets.
This fits a depressing pattern. The Glazers' takeover has already sucked more than £500m out of the club since 2005 in debt interest payments, administrative costs and fees paid to the family. And over this period ticket prices have risen well above inflation, pricing out many of the club's longstanding local supporters.
Shareholders and the clubs' fans actually have a common interest. Both want the team to fulfil its potential on the pitch and for the club to have a sustainable financial structure. Early dismissal from the lucrative Champions League for a few seasons would present serious financial problems, even for a club as wealthy as United.
And relegation from the Premier League would be an economic disaster. That might sound an outlandish prospect for such a successful club, but there are signs that the huge debt pile the Glazers have heaped on United is finally beginning to hinder its ability to compete with the best teams in England and Europe.
The Glazers have successfully driven up commercial revenues – particularly sponsorship – in the years since they took control. But spending on players has been modest in recent years despite the manifest need to strengthen the squad in vital areas. The 2011/12 season was the first since 2005 in which the club has not won a trophy.
And there are growing fears that when the club's veteran manager, Sir Alex Ferguson, retires, as he surely must in the coming years, it will be difficult to attract a top class replacement who will be willing to work within a limited transfer budget.
The curse of Manchester United is that while the Glazers remain in charge of the club's destiny and while their debt remains hanging around the institution's neck it is difficult – for either shareholders or fans – to see brighter days ahead.
Fan power: Major brands targeted by supporters
The Glazers have struck some massive sponsorship deals since 2005 after persuading companies of Manchester United's vast popularity. The most recent has been the $659m (£422m) shirt deal with General Motors Chevrolet.
But the Manchester United Supporters' Trust (MUST), which organised the anti-Glazer "Green and Gold" protests, last week issued a head-on challenge to this aspect of the family's business model when they launched a global boycott of the club's sponsors in protest against the float. Manchester United fans have been asked not to buy products manufactured by the club's sponsors, which include, Aon, DHL, Chevrolet, Hublot, Smirnoff and Nike.