Manchester United IPO – Q&A – Should you buy into it?

With the Glazers planning to put around 10% of the club up for sale, many will have questions and this will hopefully seek to answer them.

Q. What is the value of each share?
A. Between $16-20

Q. Should I read the terms and conditions before buying.
A. This is the most important thing you must do, these shares have very little share holder rights and you will likely lead to you losing your money from day one.

Q. Where will the money go?
A. Of the $300m reported they want to raise, half will go towards the clubs £423m debt and other half is being paid out directly to the six members of the Glazer family. This will only reduce the clubs debt by around £73m when the original plan was to use all of it to reduce the debt.

Q. What are my voting rights?
A. They are none. The Glazers have planned the sale with special terms and conditions attached meaning the shares they own have 10 times the voting rights of the shares on public sale. If one person brought that 10% they’d have 1.3% voting rights.

Q. Is their a yearly dividend?
A. No.

Q. Will they rise in price?
A. Unlikely. With the club to make another reported loss this year, wages on the increase, the need to spend big money on players and there still being a massive problem paying out interest before and after the share sale the clubs books won’t like much better than before. There are pages and pages of other risks listed in the prospectus.

Q. Can I make any money of out them?
A. With no dividend, you’d be relying solely on share price it rise. Many recent IPOs have seen their share prices drop by over 10% to 15% in their first month.

Q. Will this be good for the fans?
A. Short answer is no. The first expectation is for the club debt to be fully paid off, this isn’t happening.

Q. Is this a good deal for investors?
A. No, there is very little room to make much money.

Q. What can we do to change the terms and conditions?
A. Have investors and fans refuse to buy shares and demand the terms and conditions are changed. Full Voting Rights and a yearly dividend should be basic requirements.

Q. Should we buy shares if the terms and conditions change?
A. This is possible but only if this fails and the above happens.

Q. What else could I earn money on and invest in for the time being?
A. The Manchester United Supporters Trusts Phoenix Fund (withdrawable share capital) will pay out more from interest which is guaranteed than these shares.

Q. How do I sign up for this?
A. Become a paid member of MUST on the website.

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