Manchester United’s owners intend to use part of the proceeds from its planned Singapore flotation to pay down the club’s £515m ($849m) debt, according to people with knowledge of the IPO strategy.
The US-based Glazer family, who took the Premier League champions private in 2005, are targeting an offering believed to be about 25-30 per cent of the company. They hope to complete the public offer in the fourth quarter of this year, one person said, adding that an application had been filed at the Singapore exchange. Credit Suisse has been appointed as lead bookrunner.
“A part of the proceeds will be used to pay down club debt,” said the person, who professed no knowledge of the Glazers’ intentions for the remainder of the proceeds.
Some United observers are convinced that the Glazers, owners of the Tampa Bay Buccaneers and a string of US shopping malls, are under pressure on personal debts, including some high-interest notes taken out in the family’s £790m leveraged buy-out of the club six years ago.
The person insisted that the Singapore exchange was not the Glazers’ second choice behind Hong Kong for placing the offering.
There have been some suggestions that the Hong Kong exchange’s IPO rules would have proved too onerous for United.
“They qualified for a Hong Kong listing but they chose to list in Singapore,” the person said. “The Singapore listing shows they are pan-Asian, the [Singapore] fan base is among the most fervent in Asia and the club has a lot of commercial partners in south Asia.”
But according to one lawyer with expertise in Asian listings, Singapore is a much easier listing venue compared with Hong Kong.
“Hong Kong’s regulator is much more like the SEC [the US Securities & Exchange Commission], and asks substantive questions of the company. Singapore is pretty light touch, but, like in the US, you have to file a public document, which the regulator then comments on. Both force you to do more upfront regulatory work than many other jurisdictions,” the lawyer said.
“In Singapore the filing document is public, but in Hong Kong it is private until approved by the regulator and marketing starts.
“[Manchester United] probably looked at Hong Kong and realised that it’s more expensive and arduous, and therefore decided on Singapore.”
The club declined to comment.
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