Weekend Argus (Saturday Edition) - - GOODWINES -

MANCH­ESTER UNITED chief ex­ec­u­tive David Gill this week be­gan pitch­ing the club’s £500 mil­lion bond is­sue to po­ten­tial in­vestors in Lon­don amid grow­ing con­fi­dence in the Glazer camp that the re­fi­nanc­ing ini­tia­tive – which may in­clude the sale of the club’s Car­ring­ton train­ing ground – will be suc­cess­ful.

Gill will meet ma­jor in­sti­tu­tional in­vestors and bankers in a se­ries of pre­sen­ta­tions in­tended to se­cure the bulk of the in­vest­ment. United have al­ready made pre­sen­ta­tions in Ed­in­burgh, Hong Kong and Sin­ga­pore and will pitch to Amer­i­can in­vestors next week, and ini­tial sound­ings have been pos­i­tive.

While some an­a­lysts have ex­pressed scep­ti­cism about the at­trac­tive­ness of the bond in a crowded mar­ket, The Daily Tele­graph un­der­stands that sig­nif­i­cant or­ders in ex­cess of £50m have al­ready been placed. There is an ex­pec­ta­tion within the Glazer team that or­ders will even­tu­ally run into bil­lions.

If so, it will strengthen the Glaz­ers’ hand when they come to price the bond at the end of next week.

The bond is­sue will re­main at £500m, but larger in­vestors may have to set­tle for a smaller al­lo­ca­tion.

In­vestors have been told that the coupon (an­nual in­ter­est) on the bond is likely to be around 8.5 per­cent, but were the is­sue to be sig­nif­i­cantly over­sub­scribed there may be scope for the price to come down.

The size of the or­der book may also pre­vent the Glaz­ers hav­ing to sell the bonds at a dis­count.

United’s prof­itabil­ity and suc­cess makes it the most at­trac­tive foot­ball in­vest­ment, with pre-tax earn­ings of £91m last year in­ter­preted as a comfortable cush­ion against the club’s debt, which at­tracts in­ter­est in ex­cess of £40m a year. – The Tele­graph

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.