Skip to main content

Slump in United's value

Manchester United's value has slumped by more than £260m in the decade since the Glazer family sold 10 per cent of their shares on the New York Stock Exchange.  It is exactly ten years since the club was listed in New York and the Glazers have taken more than £100m in dividends since then.

The share price on Tuesday evening was 19 per cent lower than when it was launched.  On the basis of the value of the shares, United's overall value had dropped from £2.2 billion in 2012 to about $1.88 billion.  (This does not take account of inflation at an average of 1.7 per cent a year in the UK).  In the same period the share price of Juventus has doubled.

Football finance guru Kieran Maguire reckons that the low price reflects investors having a negative view about the management of the club from the owners downwards.  'If you are that far below your launch price a decade later then that must be a reflection on how the market perceives the quality of management', he told The Times.

Maguire notes: 'If you had invested £1,000 in Manchester United shares that day on 10th anniversary they're worth £814. Same amount invested in Juventus is worth £2,000, F1 £2,564, Atlanta Braves £1,585.'

Until the pandemic United delivered profits almost every year, as well as setting the bar in terms of commercial growth.  The failures on the pitch have not been down to a lack of investment in players.  In terms of net expenditure, United have spent £1 billion since 2013, only just short of Manchester City and more than Chelsea's £735m.

However, income from player sales has been well below their rivals - £400m at United, £500m at City and £735m at Chelsea.

Maguire believes that the Glazers may have banked on a Super League or something like Project Big Picture to fund investment at Old Trafford.

As it is, the club will have to take on more debt to fund the expansion of the stadium to 90,000 seats.  this will mean taking on more debt, but Maguire points out that Tottenham have shown the value of taking on debt to improve a stadium.

Labels:

Comments

Post a Comment

Popular posts from this blog

Threat of financial calamity removed from Baggies

West Bromwich Albion had effectively been in decline ever since the club was sold to a Chinese consortium in August 2016, paying a figure north of £200m to buy former owner Jeremy Peace’s stake. Controlling shareholder Guochuan Lai’s ownership was fairly disastrous for the club, but his unloved tenure finally came to an end after Bilkul Football WBA, a company ultimately owned by Florida-based entrepreneur Shilen Patel and his father Dr Kiran Patel, acquired an 87.8% shareholding in West Bromwich Albion Group Limited, the parent company of West Bromwich Albion Football Club. This change in ownership was urgently required, due to the numerous financial problems facing West Brom, including growing high-interest debt and serious cash flow concerns, following years of no investment from the former owner. Indeed, West Brom’s auditors had already rung the alarm bell in the 2021/22 accounts when they cast doubt on the club’s ability to continue as a going concern without making player s...
1 comment
Read more

Spurs to sell minority stake

Tottenham Hotspur is in talks to sell a minority stake in a deal that could value it at up to £3.75 billion and pave the way for Joe Lewis and his family to sever ties with the Premier League football club. Tottenham chairman Daniel Levy is seeking an investment that values the club at between £3.5 billion and £3.75 billion, including debt. While the terms of any deal have not been finalised, City sources expect Spurs to sell about 10 per cent. The club is being advised by bankers from Rothschild on the sale. Tottenham wants to raise fresh capital for new player signings and to help fund the development of an academy for its women’s team, as well as a 30-storey hotel next to its north London stadium. The financier Amanda Staveley, who brokered the deal for Saudi Arabia’s Public Investment Fund to take over Newcastle United, is understood to be among the parties to have expressed an interest in Tottenham. Staveley’s fund, PCP Capital Partners, has raised about £500 million to ...
Post a Comment
Read more

Fulham requires big funding from owner

After lengthy delays, Fulham’s shiny, new Riverside Stand has finally opened, creating “a unique Thameside destination with first class facilities for supporters and partners on match days, as well as for the wider community year-round”. This ambitious project has increased Craven Cottage’s capacity by around 4,000 to 29,600, while it has also taken advantage of the club’s fantastic location and wealthy catchment area by including two Michelin star restaurants, a rooftop swimming pool, corporate hospitality and event space, all benefiting from views of the Thames. Chief executive Alistair Mackintosh observed, “Fulham is the sort of club that can have a business class or first class and have fans that turn left on a plane.” Indeed, there is also an exclusive members club – with a football season ticket as an optional extra. It’s fair to say that “the times they are a-changing”, as this is a long way from the traditional pie and a pint. However, in a world where clubs face the tw...
Post a Comment
Read more