Manchester United Seeks Singapore IPO

Ahem. After all the S-chips "challenges", we still have illusions on the regualtor's role on Corporate Governance? All regualators are fixing the fence after the horses have bolted... A white knight to look after our interests?

'Caveat emptor' is the accepted maxim for those entering the stock market. It extends to IPOs as well, no matter how branded the offered product is.

Above statement is what we say when we've make the rigth choices. But once we've made a mistake, we either complain (small fishes) or we sue (big fishes)! Just look at the number of high networth, "accredited" and "sophisticated" investors who sue their private bankers. When facing huge losses, all of sudden they become very humbe, low IQ, clueless investors who were "misled" by their "evil" advisors. Yeah right!

Let's take an analogy. If I am an apples grower and I gave my apples to an agent to sell in the weekend market.

1) If I realise the retail buyers of my apples were able to resell my apples at 50% higher prices the next day, I would give my agent a hard kick! He has undersold my apples! #$%##$^&$!!

2) If I found out that my apples were being sold at a much lower prices the next day, I would give my agent a high five! And promise to give him more business in the future - I still have oranges, peaches.... The agent is bloody good salesman! Must use him again. Kaching $$$$$$!

The Straits Times
Sep 5, 2011
commentary
Man U may score on pitch but not on bourse
Manchester United's listing will raise SGX profile, but bears risks

By Yasmine Yahya

BOTH stock market punters and football fanatics were bowled over recently by news that Manchester United is planning to launch a US$1 billion (S$1.2 billion) initial public offering (IPO) in Singapore.

Not only would this be among the biggest listings ever in Singapore's financial history, but it would also mean that ardent fans of the world's most famous football club will be able to own a piece of it easily.

No longer would wannabe club managers in Singapore have to confine their analysis of football tactics and management strategies to the coffee shop. For the price of one lot of shares, they can soon participate in Manchester United shareholder meetings and voice concerns to the management, face-to-face.

But it is the Singapore Exchange (SGX) which is likely cheering the loudest over the Red Devils' plan.

Many financial commentators have called this IPO a major coup for the SGX, and with good reason.

While many big names from the West are flocking to Asia to raise funds, most of them have picked Hong Kong over Singapore as their bourse of choice. Hong Kong was the top venue for such listings in Asia in the past two years.

Luxury label Prada, the world's biggest luggage maker Samsonite and Swiss commodities giant Glencore all saw that rising consumption in Asia will be the main driver of their future business growth, and all three chose to launch listings in Hong Kong earlier this year.

In fact, sources say that Manchester United's billionaire owner Malcolm Glazer and his investment bankers had also decided to launch the club's IPO in Hong Kong.

But just days before they were to submit an application for a listing on the Hong Kong Stock Exchange (HKEx), SGX chief executive Magnus Bocker flew to Hong Kong to meet Mr Glazer and change his mind.

The listing may finally rid Singapore of its image as a poorer cousin to Hong Kong. It will give credence to Mr Bocker's oft-repeated view that while Hong Kong is a good market for companies that are focused on expanding in China, Singapore is the best gateway from which to grow a broader Asian presence.

Singapore is, after all, where a lot of the South-east Asian money is. Already, it is fast closing the gap with Switzerland, traditionally the world's dominant centre for wealth management. A PricewaterhouseCoopers (PwC) report in June said that Singapore will become the world's top wealth management centre by 2013, ahead of Switzerland, London and Hong Kong.

The listing will also help the SGX move away from an image as a bourse mainly for penny stocks and China-based firms, and raise the bar for its listings.

The SGX has also been working hard to come up with ways to raise liquidity and valuations on the local market - to limited effect - and having a big name such as Manchester United will likely help in this regard. The hope is that the Red Devils' entry will coax other big international firms to list in Singapore.

But already, the listing is running into controversy. There are rumours that one reason why Mr Glazer chose Singapore over Hong Kong was because Singapore's listing requirements and regulations were the more lax of the two.

This is unlikely, given that the SGX has strict listing requirements and insists that all listed companies engage in continuous disclosure, to keep shareholders constantly updated on its changes.

SGX's actions over the Manchester United listing will be under scrutiny. Investors may become wary if a stock is perceived to be listed under lax conditions.

And even if Manchester United does list in a couple of months' time, the final proof of success will come only later.

While Manchester United may have 333 million fans worldwide, and is considered to be the world's most valuable football club with an estimated worth of US$1.86 billion, it is uncertain how many investors actually want to own a piece of it. It is, after all, debt-laden. Early last year, Mr Glazer issued a £504 million (S$983.9 million) bond to shore up the club's cash pile. The club's latest annual report shows that its debt is about £700 million, with annual interest payments of about £40 million.

A check of stock market forums online shows some scepticism from local retail investors. Some netizens quipped that the funds raised from the IPO will simply end up in the pockets of Manchester United players such as Wayne Rooney and Ashley Young, in the form of extravagant salaries.

Neither is Singapore's track record with major international IPOs all that reassuring. In March this year, the SGX managed to snatch the IPO of Hutchison Port Holdings Trust from its own home market of Hong Kong, partly because only Singapore had a business trust structure. At US$5.5 billion, it was also Singapore's biggest-ever IPO.

But since its listing, Hutchison Port Holdings Trust has not managed to rise above its debut price of US$1.01. Today, it is trading at 60.5 US cents, down 40 per cent from its IPO price, making it one of the worst-performing market debutantes so far this year.

Thailand's largest beverage maker, Thai Beverage, launched its IPO in Singapore in 2006. At the time, it was Singapore's second-largest IPO ever, raising $1.4 billion with an offer price of 28 cents a share.

But since then, it has been trading within a tight range, and the highest closing price it has recorded is 30 cents.

If the Manchester United IPO goes underwater after its debut, it will be a blow to Singapore's aspirations to attract more such firms.

It is thus up to both Mr Bocker and Mr Glazer in the months ahead to convince both football fans and market watchers that a winner on the soccer pitch will be a winner in investors' portfolios as well.

yasminey@sph.com.sg

(05-09-2011, 06:17 AM)Musicwhiz Wrote: A check of stock market forums online shows some scepticism from local retail investors. Some netizens quipped that the funds raised from the IPO will simply end up in the pockets of Manchester United players such as Wayne Rooney and Ashley Young, in the form of extravagant salaries.

Uh oh, if MAN U ipo doesn't take off smoothly, is it our fault?
Magnus Bocker seems to be taking a lot of heat too.

Dun get me wrong, I love VB but I dun think we quite have that kind of influence on the stock market yet.

(05-09-2011, 12:37 PM)lonewolf Wrote: Dun get me wrong, I love VB but I dun think we quite have that kind of influence on the stock market yet.

Honestly, if we ever did have that kind of influence on stock prices, we would probably have to rename this forum!

(05-09-2011, 12:37 PM)lonewolf Wrote: Dun get me wrong, I love VB but I dun think we quite have that kind of influence on the stock market yet.

Ahaha, yea definitely not the broad market.

But I think there's some effect on the lesser-followed, illiquid small-caps. I call the drop in GRP's price following MusicWhiz's disclosure that he sold- The 'MW effect'.

Business Times - 09 Sep 2011

Eyes on 2-tier plan as Man Utd looks set to get IPO nod

Report says Bocker clarifies that SGX will 'ensure equality among all players'

(SINGAPORE) Singapore Exchange's (SGX) coup in luring Manchester United to the city is threatening to turn sour as the bourse comes under fire for plans to let the club list using a structure that will minimise the influence of new shareholders.

SGX is set to approve the English Premier League champions' up to US$1 billion initial public offering (IPO) this week or next, two sources with direct knowledge of the listing said.

The Red Devils have spent the past few weeks courting Asia's major institutional and sovereign investors including Singapore investment firm Temasek, said the sources.

But the club's plan to use a two-tier system of shares to ensure that the Glazer family, which owns soccer's biggest brand, will retain control has some investors and analysts calling foul.

Manchester United wants to raise cash to help reduce its near-US$500 million debt pile.

Its choice of Singapore was aimed at expanding the club's huge Asian fan base as well as tapping the region's stronger growth and investment climate.

The club was tipped to list in Hong Kong but lawyers said that Singapore, which has struggled to compete with its rival for big-ticket listings, may well have been more willing to accommodate Manchester United's demands.

'I wouldn't be surprised if the SGX is showing them some flexibility, they do tend to be more willing than most of the other exchanges,' said one lawyer, who asked not to be identified as his firm may become involved in the deal.

Full details of the IPO are yet to be disclosed but sources have said that some of the shares issued will be in a two-tier share structure.

Lawyers said that it is unlikely that the club will go down the route of having the two-tier A-share/B-share structure seen in countries such as the United States, where some ordinary equity shares carry no voting or fewer voting rights.

For a start, that is banned by the Singapore Companies Act which states that there should be one vote, and one vote only per equity share.

But lawyers said that it is likely that the club will instead make a significant part of its offering in preference shares - equities that carry no voting rights but get priority over ordinary shares for dividend payments and in the event of liquidation.

SGX chief executive officer Magnus Bocker indicated that such a structure might be feasible in a television interview yesterday.

While the principle of one vote per ordinary equity share is likely to stay in place for the time being, companies can vary their capital structure with preferred equity instead, said Mr Bocker.

'Preference shares are underestimated,' he told CNBC.

In a report yesterday, Channel News Asia (CNA) said that Mr Bocker has clarified that the exchange will 'ensure equality among all players' and 'will never treat anyone special'. Mr Bocker, who was speaking on the sidelines of a symposium in Singapore, was responding to suggestions in earlier reports that the SGX may have compromised corporate governance rules to allow Manchester to list under a two-tier listing restructure, said CNA.

Manchester United may also have to face the prospect that the share structure could dent the value of their US$1 billion offering, which has raised eyebrows for being overly optimistic from the outset.

The Glazers are deeply unpopular with many of Manchester United's estimated 333 million global fans after buying the club in 2005.

'Clearly the degree of control by one majority shareholder has to be a major concern for any conventional investor thinking of purchasing shares primarily seeking a return on investment,' Duncan Drasdo, chief executive of Manchester United Supporters Trust, told Reuters. -- Reuters

The Straits Times
Sep 10, 2011
Man U listing may get SGX nod next week
Some surprised by speed of process, but lawyers say it is to ensure data stays valid

By Magdalen Ng

MANCHESTER United's US$1 billion (S$1.2 billion) listing application on the Singapore bourse may be approved as early as next Thursday.

Sources involved in the deal told The Straits Times that they have been working round the clock to get the paperwork for the initial public offering (IPO) in place.

While some industry players have expressed surprise at the speed of the process, lawyers do not see any cause for concern.

A lawyer familiar with the subject, but not involved in the deal, said there may be pressure to move fast so that the financial data remains valid for the prospectus.

'Under Singapore law, the last-audited accounts can last for only six months. For an international offer to qualified buyers in the United States, the timeframe is 135 days, so there is a lot of pressure to be quick,' he said.

Once the Singapore Exchange (SGX) has approved the IPO, the dealmakers can next work on the prospectus, to be lodged with the Monetary Authority of Singapore and made public for 28 days.

During that time, information will be gathered from the public, and the club can start holding roadshows and meeting analysts. Only after that will the prospectus, which has to take into account the public opinion garnered, be finalised for the launch, which will then contain the price of the shares.

Corporate lawyer Robson Lee expects that the end of next month would be the earliest date for the launch.

He said: 'If there is a turn in market conditions, we could possibly see a delay till next year. Traditionally, no one launches in November and December because fund managers go on leave. We're talking about a very tight timeline.'

There has also been talk that Manchester United plans to list in Singapore with dual-class shares.

This is stock issued by one company with two different sets of rights - typically voting rights, although it can sometimes include different dividend payments.

If the two classes of equity have different voting rights, the non-voting stock - or the stock with fewer votes per share - becomes subordinate to the voting stock.

Companies sometimes list with dual-class shares to protect their domestic ownership and limit foreign influence, especially for companies listed in smaller exchanges.

Critics say the option detracts from good corporate governance, as shareholders cannot exercise an effective check on the management.

Singapore's Companies Act prohibits companies from issuing dual-class stock.

But lawyers said this may not pose a hitch to the eventual IPO, as Manchester United is not incorporated here, so this part of the Act will not apply.

The eventual decision will lie with the SGX.

songyuan@sph.com.sg

It's coming...



Manchester United Said to Get Singapore’s Approval for Listing
September 16, 2011, 6:12 AM EDT



By Joyce Koh
Sept. 16 (Bloomberg) -- Singapore’s stock exchange approved Manchester United’s application to raise about $1 billion in an initial public offering in the city-state, two people with knowledge of the matter said.

As much as two-thirds of Manchester United’s offering will likely be in preferred shares, which may carry at least double the dividend of ordinary stock while lacking voting rights, said the people. They declined to be identified as the IPO process is private.

United’s dual-share structure offers a way for the Glazer family to retain control of the football club after the IPO, the people said. Singapore’s bourse lured United in part by offering a speedier approval process for the IPO, people with knowledge of the matter said last month. United applied for the Singapore listing on Aug. 18, they said.

“Football clubs around the world are mostly quite closely held and not very transparent,” Pearlyn Wong, an investment analyst in Singapore at Bank Julius Baer & Co., which manages about $190 billion globally. “They don’t like to give up voting rights so they can make faster decisions over things like players and management.”

United, which was planning to list in the first half of October, is reviewing the IPO timeline amid volatile markets, the people said. Stock offerings have dwindled worldwide as Europe’s escalating sovereign debt crisis and a faltering U.S. economy dented demand for new equity.

Manchester United spokesman Philip Townsend and Singapore Exchange spokeswoman Carolyn Lim declined to comment.

Bundled Offering

The preference shares will be bundled with ordinary shares for the offering, though each security will be quoted separately on the stock exchange, the people said.

“Usually preference shares come as a follow-up offering, rather than at the IPO stage,” Julius Baer’s Wong said. “Whether people will receive the share structure well depends on how much dividends they can get and whether the company has the cashflows to support it.”

The 19-time English soccer champion’s decision to sell shares in Asia was also prompted by its growing fan base in the region, people familiar with the matter said last month.

United first toured Asia four decades ago and plans to do so again next year. When the club last made the trip, the players were mobbed by supporters wearing replica shirts bearing names of stars like Wayne Rooney and Ryan Giggs.

United’s pretax profit in the year ended June 30 was 29.7 million pounds, compared with a loss of 15 million pounds last year. It’s the second time in six years the club has been profitable.

’Sucked In’

The lack of sustained earnings may repel investors, said Lee King Fuei, a Singapore-based fund manager at Schroders Plc, which oversaw $323 billion as of June 30.

“Institutional investors are unlikely to be interested, while retail investors will be the ones sucked in by the branding and marketing,” he said. “The lack of voting rights is just a kick in the teeth.”

The company hired JPMorgan Chase & Co. and Morgan Stanley as bookrunners for the IPO together with Credit Suisse Group AG, three people with knowledge of the matter said last month. United also picked BOC International Ltd., CLSA Asia-Pacific Markets, CIMB Group Holdings Bhd. and DBS Group Holdings Ltd. as co-lead arrangers for the offering, the people said.

maybe not ....

http://www.thesun.co.uk/sol/homepage/spo...plans.html

Glazers shelve Man United flotation plans

MANCHESTER UNITED may put their Singapore flotation plans on hold.
Owner Joel Glazer and his brothers seem to be waiting for the volatile stock markets to calm down before they make their move.

United, who have privately dismissed talk of a potential £1.5billion sale to the Qatari Royal Family, have been given permission to launch a flotation.

It had been thought the Glazers would actively pursue a move that could raise £600million in time to be completed by the end of next month.

But insiders say they are currently "in no rush" to execute their plans.