Manchester United’s IPO limps to the goal line
A slashed IPO price and sluggish trading. But nothing dampens the spirit of NYSE Euronext when an IPO comes to town, especially one with the brand oomph of Manchester United, the world’s most famous football club and now its most valuable sports team.
United priced last night at $14, below the expected range of $16 to $20, raising $234 mn and valuing it at $2.3 billion. The stock opened at a disappointing $14.05 and barely budged all day, closing back at $14.
Despite soccer’s low profile in the US, there were enough fans on Wall Street this morning to stage a party for MANU (its new ticker symbol). Giant soccer ball balloons, ball handling displays and a lot of red and gold decorated the outside of the exchange. Inside there was astroturf on the famed floor.
United chose Getco Securities as its designated market maker, perhaps because Donny Civitanova, a big United fan and the trader who would handle the stock, vowed he knew the team better than management, backing up his claim with a photo of Getco employees wearing his collection of past United shirts.
Civitanova drew cheers when he arrived today on the NYSE floor in the current United strip, shorts and soccer cleats. Frank DeGarcia, governor at the NYSE, doubled over laughing and declared it a first for the exchange.
Many other traders, exchange officials and guests also sported United shirts. Even NYSE CEO Duncan Niederauer had one with his name on the back.
Skepticism had dogged the IPO. Analysts and fans griped about the debt load piled on by the Glazer family, which took United private in 2005 for around $1.5 bn. The Glazers are pocketing half the IPO proceeds with the other half going to the club.
Listing on the NYSE may seem unusual for a European football club considering soccer’s minimal appeal in the US (the US women’s Olympic team’s gold medal yesterday notwithstanding).
United was able to take advantage of the new JOBS Act, which allows a confidential SEC review before issuing a prospectus, and listing in the US allowed the Glazers to retain control of the company through a dual-class voting structure.
All that debt and doubt combined with gloom in the US IPO market since the Facebook debacle were reflected in United’s cut-rate pricing and subsequent stock performance. Still, the fact that the offering took place was impressive, as was the opening kick-off.