I hadn’t got involved in the recent flotation of Manchester United (MANU), perhaps Britain’s best-known brand of (English) football club. Not just because I’m an Arsenal fan either, but because investments in sports franchises can often be a case of heart ruling head and the Glazers (current owners) were unlikely to be selling cheap.
But this morning I came across this wonderful article that shows MANU’s IPO foisted on hapless retail investors was “Facebookian” in its cavalier attitude towards earning a return for new owners. IPO buyers have virtually no voting control, little prospect of a near-term dividend and proudly possess shares trading at 106 times earnings, a level Mark Zuckerberg even failed to emulate. And MANU describes itself as an “emerging growth company” (in order to qualify for more lenient disclosure requirements), a scarcely credible notion for anyone who grew up watching them in the 70s or earlier.
As long as deals like MANU’s IPO can get done it shows that not everybody’s hunkered down waiting for one of the many looming disasters (Euro/Fiscal Cliff/Israel-Iran/China Crash) to hit.