Malcolm Glazer and Manchester United FC 05/2004

US entrepreneur Malcolm Glazer upped his stake in Manchester United to 18.25 per cent at the end of April. Some of the shares acquired by Mr Glazer were sold by Maurice Watkins, one of the club’s non-executive directors. Mr Watkins, a long-term shareholder and one of the club’s legal advisers, sold 1 million shares at 250p each to reduce his stake to 1.91 per cent.

The offer period initiated by the Takeover Panel in response to Mr Glazer’s activities has now been lifted. Manchester United declined to exercise its right to ask Mr Glazer ‘to put or shut up’ by either ruling out a bid or making a firm offer. Glazer’s tactic of slowly building up a stake in United has puzzled City analysts many of whom believe the shares are already overpriced, but since when did financial logic have much to do with football shares? Moreover, despite a season with its disappointments on the pitch, Manchester United continues to generate profits that outstrip the limited returns of its rivals. Plans to expand the Old Trafford stadium by another 7,500 seats should consolidate its claim to have by far the largest club ground in Britain.

One consequence of the recent share purchase activity is that the number of small but still significant shareholders has been eroded. The shareholding has become increasingly concentrated on Glazer and Cubic Expression, the investment vehicle of racehorse owners J P McManus and John Magnier.