Britain’s Manchester United, the world’s largest soccer club, is no longer planning to list its shares in Singapore, according to Reuters. Instead, it’s looking for an IPO in the U.S. — which could be tough to pull off. The main problem? The U.S. really doesn’t care about soccer.
It’s true that there are some hot publicly traded sports franchises — that is, for those that have loyal fan bases. Take a look at Madison Square Garden (NYSE:MSG). Over the past year, the stock price is up over 41%. Oh, and the P/E is a hefty 31.
Or consider the Green Bay Packers. In December, the team sold stock online — and the demand was heated. Keep in mind that it is owned by a nonprofit organization, so investors can’t even sell their shares!
As for Manchester United, it’s a storied soccer team, having won 19 championships. Yet the company had to take on substantial debt because of a leveraged buyout in 2005, something an IPO will help reduce.
What’s more, the current soccer team has been slipping. In 2011, it failed to win a trophy for the first time in six years.
Still, the real problem is that for most Americans, Manchester United, although a household name (which is saying something for a soccer team), still doesn’t mean much. Other sports like football, baseball and basketball get most of the attention.
Besides, the disastrous Facebook (NASDAQ:FB) IPO has likely put a stop to mega-deals for a while. In other words, don’t expect Manchester United to score an IPO goal.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “The Complete M&A Handbook”, “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.
A long-time follower of the IPO scene, back in 1999 Tom started one of the first sites in the space called WebIPO. It was a place where investors got research as well as access to deals for the dot-com boom. Tom also wrote the top-selling book, Investing in IPOs. In it, he covers all the aspects of analyzing an IPO, such as reading the prospectus, detecting the risk factors and understanding some of the arcane regulations. But don’t worry — if that process is too intimidating for you, thankfully Tom will do the legwork for you right here in the IPO Playbook blog.
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