Singapore Scores Manchester United IPO

By Ilya Rzhevskiy, Epoch Times
August 25, 2011 Updated: October 1, 2015

Manchester United manager Sir Alex Ferguson after victory in the Barclays Premier League match between Manchester United and Tottenham Hotspur, on Aug.  22, 2011 in Manchester.  (Alex Livesey/Getty Images)
Manchester United manager Sir Alex Ferguson after victory in the Barclays Premier League match between Manchester United and Tottenham Hotspur, on Aug. 22, 2011 in Manchester. (Alex Livesey/Getty Images)
Manchester United, the English soccer club in the Premier League, has agreed to an initial public offering (IPO) of stock on the Singapore Exchange Ltd (SGX).

According to Forbes, Manchester United Club is valued at $2.4 billion, which makes it the most expensive sports team in the world, ahead of the Dallas Cowboys and the New York Yankees.

The club’s initial intention was an IPO to be listed on the Hong Kong Stock Exchange (HNEx), but due to a long administrative process in Hong Kong, a decision was made to offer the shares in Singapore.

“Time to market is always important when you want to raise money quickly,” said Kevin Scully, who is executive chairman of NRA Capital, a Singapore-based financial adviser. “The longer you wait, the more uncertain the market might become and valuations you thought you could get might not be there anymore,” he added regarding a much faster and less administrative IPO registration process in Singapore.

In response to losing the IPO to Singapore, Hong Kong said it doesn’t see any reason to shorten its administrative process regarding IPO registrations.

“Hong Kong’s listing process is efficient and HKEx aims to keep it that way,” Hong Kong Exchanges & Clearing Ltd. said in an e-mailed statement to Forbes. “The process is interactive so there are no typical cases, and there are fast-track cases from time to time.”

Hong Kong is known for major IPOs in the last few months by Prada SpA, Glencore International Plc, and Samsonite International SA. Since Singapore’s market capitalization is a quarter of Hong Kong’s, this was an important coup for the Singapore Exchange.

Malaysian tycoon Tony Fernandes addresses a press conference at Queens Park Rangers football club in London, on Aug. 18, 2011. (Carl de Souza/AFP/Getty Images)
Malaysian tycoon Tony Fernandes addresses a press conference at Queens Park Rangers football club in London, on Aug. 18, 2011. (Carl de Souza/AFP/Getty Images)

“If all the major listings are going to Hong Kong, people might increasingly see the SGX as not as important,” said James Koh, a Singapore-based analyst at Kim Eng Securities Ltd. “That’s why it’s good to get a big catch like that.”

Luring Manchester United is a definite win for Singapore. Manchester United has 330,000 fans worldwide, of which 190,000 are situated in Asia and many are in Singapore.

“The appetite is big in Asia for the Premier League,” said Tony Fernandes, CEO of Malaysia’s AirAsia Bhd in an Aug. 18 interview with BusinessWeek. “Singapore’s got lots of capital and Manchester United is a very strong brand in Southeast Asia. It’s a smart move if done correctly.”

Manchester United is the most successful English soccer club, having won 53 domestic trophies, 19 league titles, a record 11 FA cups, 4 league cups and 19 FA Charity/Community Shields.It was founded in Old Trafford, Greater Manchester back in 1878 with a different name, “Newton Heath LYR Football Club.” In 1902 it changed its name to Manchester United.

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