Like Attracts Like: Glazers Plan US Man U IPO [?!]

♠ Posted by Emmanuel in , at 6/14/2012 10:23:00 AM
I have been following the plight of the reviled Glazer clan, erstwhile owners of Manchester United Football Club, as they raise the ire of English football fans with their vile "Ameriscum" shenanigans, featuring the worst sort of financial chicanery their home nation has to offer. Their 2005 original sin of acquiring the storied club via leveraged buyout saddled it with onerous debt, all the while forcing supporters to pay inflated ticket prices. 

In August of last year we received news that the Glazers planned to improve the financial position of the debt-laden club by listing it in Singapore. Supposedly they would be able to capitalize on the large global Man U fanbase, especially in Asia. To which I said...
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. 
Well folks, score it IPE Zone 1, Ameriscum in Southeast Asia 0. (And Tim Geithner has indicated that he won't serve another term as Treasury secretary even if Obama is elected, so I've even found him a hot job prospect.) Apparently, the ever-devious Glazers didn't find the terms and conditions in the relatively freewheeling Lion City to their liking. Reuters has a useful recap of the extremely questionable reasoning behind the Glazers' retreat to the land where Stupid Financial Tricks are actually a source of pride in certain circles:

One of the sources said Manchester United had always planned to position itself as a global media business rather than a sports franchise, suggesting that a US listing would make more sense. The club's American owners, the Glazer family, are well known in the US as owners of American football team the Tampa Bay Buccaneers, as well as First Allied Corp, which owns and leases shopping centres. Conversely, they are extremely unpopular in the UK, which could have made a London listing difficult.
The Singaporean exchange authorities have not exactly been forthcoming with the idea of offering shares that give few to no voting rights to shareholders. In other words, it would have been another raw deal from these Yanks in the same way that they screw over Man U fans year in and year out with inflated ticket prices. So it's back to America where they hope to shaft folks in that genuine American fashion:
U.S. investors are also familiar with the dual-class share structure that was under discussion for Manchester United's Singapore listing, having seen it used by household names such as Google and Facebook. The Glazers are understood to have wanted to sell Class B shares with limited or no voting rights to maintain a level of control of 95-100 percent.

That structure was said to be one reason why they opted for Singapore in the first place, as, unlike Hong Kong, the exchange was happy to agree to the format, and for the club's Class A shares to be quoted but not traded. However, the issuer is understood to have become frustrated with long delays in approval from the SGX, even after it had indicated it would have no problems with a dual-class share issue.

Going back to the US homeland of Stupid Financial Tricks--the UK is obviously similar, but fan hatred precludes a Man U listing there--has its drawbacks. The most obvious of these is that few Yanks actually follow world football, preferring homegrown cornpone "sports" [yee-haw!] alike neo-primitivist NASCAR racing or, to mimic the Glazer's claim about being a global media conglomerate, "World Wrestling Entertainment." Fanbase numbers certainly aren't encouraging:

A U.S. listing might earn the company a better valuation as a media business, since it has contracts for broadcasting rights as well as its own television channel. However, it is unlikely to achieve the original goal of putting shares in the hands of a wide base of United fans. A source said the original aim of the Singapore listing was to create "a pan-regional platform for retail investors".

Singapore had seemed the ideal location, as it provided a way to reach retail investors in one of its biggest fan bases, Indonesia. When the Singapore listing was still under consideration, the importance of Asia to the company, with much of its growth coming from Asian merchandise sales, had been heavily emphasised during marketing to investors. The club claims to have 659 million supporters worldwide, of which 325 million are in Asia Pacific and 55 million in Indonesia. It counts just 34 million fans in North America, where soccer has yet to build a significant supporter base.

The sad thing for Man U fans is that while the Glazers have already brought their financial chicanery home where it belongs, they still retain the club. For that we will still have to wait. And oh yeah, Glazers go home.