United float plans revived

The Glazers are reported to have revived their plans to partially float Manchester United in Asia due to improving market conditions.

Their initial plans were shelved last year, partly because of the impact of the eurozone crisis, but it is thought that their advisers now believe there is a window of opportunity to list the club on the Singapore stock exchange before the start of the new season in August.

By selling between 25 and 30 per cent of the shares, the Glazers hope to raise between £400m and £600m, a move that could value United at up to £1.6 billion.

The Glazers are reported to have revived their plans to partially float Manchester United in Asia due to improving market conditions.

Their initial plans were shelved last year, partly because of the impact of the eurozone crisis, but it is thought that their advisers now believe there is a window of opportunity to list the club on the Singapore stock exchange before the start of the new season in August.

By selling between 25 and 30 per cent of the shares, the Glazers hope to raise between £400m and £600m, a move that could value United at up to £1.6 billion.

The view being given from the Glazers is that this is simply a move to reduce United’s net debt which stood at £439m for the year ending December 2011.   This would drastically cut interest payments and make the club £50m a year better off.   That would be the equivalent of two world class signings or a third of the wage bill.

Of course if the money was used to make dividend payments, the potential benefits would not be realised,   Most leading companies on the Singapore exchange do pay dividends.   Such  a move would rekindle resentment among fans at the Glazers which has died off somewhat against the background of this season’s success on the pitch.

In total about £480m has been spent on interest, fees and debt repayments since the Glazers took over in 2005 once corporation tax savings of £100m have been taken into account.   To put this in perspective, Sir Alex Ferguson’s net spend since then has been only £67m.   This perhaps demonstrates how much difference can be made by a good manager (and a good youth policy).

Of course there is always the qustion of what happens when he leaves.   But by that time United will be unrivalled by any club in Britain in terms of spending power given that Chelsea and Manchester City will increasingly be constrained by the financial fair play rules.