The Glazer family will keep a tight grip on Manchester United after a third of the club is sold off. Two-thirds of a $1 billion dollar (£630m) initial public offering on the Singapore stock exchange will be through non-voting preference shares, keeping as much as 88 per cent of the voting rights in the hands of the Glazers. Just 12 per cent will be in the form of ordinary shares with full voting rights, the minimum required by the Singapore stock exchange.
The Glazer family will keep a tight grip on Manchester United after a third of the club is sold off. Two-thirds of a $1 billion dollar (£630m) initial public offering on the Singapore stock exchange will be through non-voting preference shares, keeping as much as 88 per cent of the voting rights in the hands of the Glazers. Just 12 per cent will be in the form of ordinary shares with full voting rights, the minimum required by the Singapore stock exchange.
The preference stock will not have dividend guarantees or the right to sell back to the stock and hence will be relatively illiquid. However, they would rank above ordinary shares in the event of an insolvency. The retention of disproportionate voting rights by the Glazers is modelled on the US sports sector and has been justified as a way of delivering strong management.
The use of preference shares is less controversial than two separate classes of ordinary shares which the club was apparently originally considering. The Singapore state investment agency, Temasek, is thought to be considering taking a large stake as a cornerstone investor.
The ordinary shares are likely to be packaged with the preference shares, for example with one ordinary share being accompanied by one preference share of double the value which would put 36 per cent of the equity on sale. The offer is expected to take place in mid-October subject to a reduction in market turmoil and formal listing approval from the exchange.