Thursday, July 26, 2012

Devils Put Off Flotation Due To Eurozone Crisis

United 'temporarily' postpone stock market flotation amid Eurozone fears
26 July 2012

Manchester United have temporarily postponed their flotation on the New York Stock Exchange amid market fears caused by the Eurozone crisis.

The Glazer family, who own the club, are believed to have been spooked by the volatile US markets - forcing them to reconsider their £193million flotation in New York.

The plan had been to begin trading United's shares from early August, but this has been put on ice.
Advisers at the club are reassessing the plan to list the company's shares after another dismal week in the eurozone, causing the markets to slide.

United were taken over by Malcolm Glazer and his sons for £790million in 2005. The deal was met by protests from angry fans, who took up the mantra of 'Love United, Hate Glazer' from the off.
Fans were opposed to the US businessman taking over because of his reliance on debt financing, which appears to be playing a part in their consideration of a flotation.

It has been reported than some of the £1billion raised in the flotation would be used to pay down the club's massive £420million gross debt.

Manchester United fans have welcomed the news of the flotation - not only will it dilute the Glazers grip on the club's finances, it could also pay off some of the huge debt their noisy neighbours, Manchester City, persistently remind them of.

This maybe an escape plan for the Glazers from the fan's fury and the debts. After took over Man United in 2005, once very stable public company, the Manchester club was burden with huge debts. Fans cant wait any longer with this situation. A club with huge tradition, history and success was mirrored by huge debts. This is unacceptable. Though the club is still manageable and far away from into administration, burdening with huge debts is not in Man United style.

The club aborted the flotation in Singapore Stock Exchange last year due to market volatile with Eurozone crisis as the main factor. The Glazer shifted to New York. But their intention to make other people to pay their debts again halted with the same reason.

Prior to the 2005 takeover by the Glazer family the company had traded as Manchester United plc on the London Stock Exchange since 1991 and prior to flotation was registered as Manchester United Football Club Limited. Now the intended flotation will make Man United become a wholly-owned subsidiary of Manchester United Ltd, a holding company based in the Cayman Islands.

Like it or not, under capitalism it is money that matter.

No comments: