Manchester United IPO (MANU) – Prime short target ?

After unseccusfully trying Hongkong and Singapore, ManU Ipoed today on the US stock exchange. The IPO price was significantly below the initial range:

The IPO priced at $14, below the $16-20 range the club’s bankers had been seeking. It valued the 19-times English champions at only $2.3 billion and shaved as much as $100 million off the proceeds expected for the team and its owners.

Of course, the public shares have almost no voring rights and dividends should not be expected.

For anyone interested in stocks and football, the F-1 listing prospectus is really fun reading and should not be missed.

Valuation is relatively difficult to determine, but somewhere in the 20-25 EV/EBITDA range based on 2011 figures. Naturally, Manu has been pumped full with high yielding debt from its P/E owners and has additional “goodies” such as 140 mn USD “purchase obligations” etc.

Interestingly they file under the “Emerging Growth” company rule, which allows corporate governance similar to my beloved Italian highway operators….

A quick look at other listed Football clubs:

By the way, Porto could be bought for only 5 mn EUR…..

Yes, ManU is a great Football club, but they cannot and will not defy gravity. So prime short candidate if borrowing is available. It is not yet oin the Interactive Broker US short list, but as soon as it is there, I wil establish a position.

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