A few months ago I wrote about grassroots efforts to eject the Glazers and send them back to the primordial Florida Everglades ooze from whence they came. There was even a rumour that Jim O'Neill of Goldman Sachs and BRICs-coining fame would lead a team of angel investors keen on rescuing the Red Devils. But as the Spanish saying goes, hierba mala nunca muere--bad grass never dies.
Now Americans are exceedingly fond of foisting BS stories on the rest of the world--among them the American Dream, the ownership society, we're a triple-A nation and other suchlike silly nonsense. And so it was probably only a matter of time before the Glazers bid to keep their asphyxiating death grip on Man U's sorry finances firmly in place. It doesn't take a genius to figure out that sports fans with real money to spend are in Asia. For instance, my team Aston Villa recently went on a more or less lucrative tour of Hong Kong where their new shirt sponsor Genting Casinos is based. Somehow, even the Glazers figured out that their countrymen were as financially unsound as they were and have gone East.
The rumour is that the Glazer-molested Man U football club is planning a stock flotation in Singapore for next year:
Manchester United plans a $1 billion initial public offering in Singapore, two people familiar with the matter said, as the record 19-time English soccer champion seeks to cut debt that has fueled fan protest. Credit Suisse is working on the transaction, which may take place this year, said the people, who declined to be identified because they weren’t authorized to speak publicly. The Premier League team had been considering Hong Kong for the IPO but now favors Singapore, although no final decision has been made, the people added. United is ready to sell about 25 percent, one of the people said.And don't forget the continuing fiscal plague clan Glazer are inflicting which has prompted all this tomfoolery:
United, examining ways to reduce its financing costs and raise money that could be used to buy players, is drawing on the sport’s rising popularity in a region where it has about 190 million fans. A listing by United would mark a victory for Singapore, which is competing with Hong Kong to attract initial public offerings by European companies.
Fans have protested against the team’s U.S. owners, the Glazer family, even though United has picked up four league titles and a European Cup since they bought the team in 2005. The club spends about 45 million pounds a year to service a 500 million-pound bond. The bond, which matures in 2017, replaced bank debt required for the purchase. That money could be used to buy players and reduce ticket prices at the previously debt-free club, according to some supporters.Now to the Singaporean diversion. Alike the equally dodgy maths employed by since-ejected Liverpool owners Tom Hicks and George Gillett, it appears the Glazers are keen on foisting exceedingly optimistic valuations of Manchester United. You see, they are said to be hopeful--and that's really the appropriate word--about floating a 25% share in the club for $1B. Forbes having valued the club at $1.8 billion, the Glazers imply the club is worth, er, $4 billion. What is it with Americans and creative accounting? Call it $2.2B billion worth of footballing "dark matter":
In March, the team’s parent company, Red Football Joint Venture Ltd., announced a record 104.7 million-pound ($170 million) fiscal-year loss because of costs related to swapping a long-term bank loan for the dollar and sterling bond last year and on lower income from player sales.
The Glazers, who also own the National Football League’s Tampa Bay Buccaneers, bought United for 790 million pounds. Forbes magazine estimates the team is now worth $1.8 billion, while it was third behind Real Madrid and Barcelona in Deloitte LLP’s list of the richest soccer clubs by revenue, published in February. Seeking $1 billion for as little as 25 percent values the business at about double its real worth, said one banker who specializes in soccer finance.And finally you have the usual reasons given for going East--there are many suck--I mean, devoted Man U fans throughout the region, etc:
“They are betting they will get a higher valuation in Asia based on smoke and mirrors rather than facts,” said Stephen Schechter, chief executive officer of investment bank Schechter & Co. in London. “I think it’s worth probably half of what they’re looking for.”
As well as the 500 million-pound loan secured against the team, the ownership also had a 220 million-pound payment-in-kind loan that accrued interest of as much as 16.3 percent. The owners paid off the lenders in November, although neither the club nor the Glazers have said how the loan was repaid.
The club has chosen Asia for its IPO because of its popularity in the region, one of the people said. The team has fan clubs in countries such as Thailand, Singapore and South Korea and a supporter base there of 190 million. It’s been searching for real estate in the region in an effort to boost its commercial operations.Are there really Singaporeans and other Asian investors dumb enough to fall for these Stupid Financial Tricks? Given the Glazers' track record, they may soon hire away Tim Geithner to tell investors how their investments in Man U are safe, all the while spouting obvious nonsense about "strong footballing finances" policy. I guess you can take the Ameriscum out of bankrupt America, but their capacity for financial foul play to paraphrase FIFA never changes.
Singapore boasts Asia’s highest concentration of millionaires and a United-themed restaurant. The Manchester United Singapore Supporters Club has 2,000 registered members, up from 50 in 2007, according to its website...
“The multitude of local events we run with global and local partners, and a prospective forthcoming tour of Asia in 2012, necessitate expanding our footprint both with people and office space,” United said in a statement earlier this month. “This is consistent with the huge appeal of Manchester United in the region, borne out of nearly 40 years of visiting.”