When the Glazer family announced in November that they were open to selling Manchester United, United's share price rose.
Manchester United's share price had been hovering around $13 for a month before the statement, but has since soared straight to $20 and has remained around that price ever since. Their share price was just below $27 in February and has now fallen below $22 as uncertainty looms over potential acquisitions.
While this growth is good for the U.S.-based Glazer family from a financial standpoint, it also benefits other investors who own stakes in the club.
The Glazer family is owners of Manchester United but owns only a 69% majority stake, with the other 31% held by multiple stakeholders.
Malcolm Glazer, who has died, completed a full leveraged buyout in May 2005, but after owning 100% of the club, his children's stake has gradually dwindled since Manchester United re-listed on the New York Stock Exchange in August 2012.
In March 2021, Afram Glazer sold 5 million shares worth more than £70 million ($87 million). His brothers Kevin and Edward Glazer then sold 9.5 million shares for £131 million in October of the same year.
A key point is that the club's shares are divided into Class A and Class B shares. The Glazer family still owns all Class B shares, which have 10 times the voting weight of Class A shares.
When Avram Glazer disposed of his shares, he sold 70,613 Class A shares and 4292387 Class B shares, but due to the ownership change clause of Manchester United's articles of association, the new owners of these Class B shares would not inherit 10 times the super voting rights, but would only receive one vote per share.
Below is a breakdown of the various types of shares owned by members of the Glazer family, taken from Manchester United's latest annual accounts as of June 2022:
As of December 2022, Manchester United's latest quarterly accounts show that Glazer owns 4.37% of Class A shares and all Class B shares outstanding.
The table below details the total number of shares in the above accounts, including shares held by other stakeholders:
The website of the Nasdaq Stock Exchange in New York mentions that a total of 130 companies or organizations that invest on behalf of their clients or members hold shares in Manchester United. So it's hard to actually count the number of people who own Manchester United shares, although the average number held by each person may not be much. Ed Woodward, the club's former executive vice president, also retained 551486 shares of Class A common stock.
Securities and Exchange Commission (SEC) filings for the last quarter ending December 2022 highlight that the club has three significant shareholders other than the Glazer family. Antara Capital purchased shares worth about $30 million, Psquared Asset Management bought about $24.5 million worth of shares, and Eminence Capital bought shares for $17 million. The numbers were reported by Bloomberg. Millennium Management also increased its stake by more than 1,200%, buying about 1.4 million shares.
The latest data, the quarterly report for the end of March 2023, will be released soon.
One reason they buy shares now is in anticipation that once Manchester United is fully acquired, the share price will rise further.
There are also some other investors who choose to sell shares to make some money. Ariel Investments sold nearly 3 million shares (26% of its total holdings). The Chicago-based investment firm was previously United's largest single shareholder outside of members of the Glazer family, but opted to cash out when the share price was above $20.
(Photo) Top 10 shareholders holding Manchester United's shares
London-based Lindsell Investments bought 93,500 shares between September and December, representing a total of more than 11 million shares, and they held 20.85% of Manchester United's share price, worth more than $220 million. Massachusetts Financial Services also sold about 19% of its shares, selling 805,050 shares as of December 2022.
"The only reason they buy Manchester United shares now is because they believe whoever takes over Glazer will try to delist them." One investor, who chose to remain anonymous to protect his company, told TA, "Before the strategic review is launched, investors who buy shares will see the club as an asset with potential and great value that has not yet been recognized by the market." ”
"If the Glazer family sells Manchester United, it will be a home run."
The two bidders who have been made public offer two diametrically opposed ideas in the process of acquiring Manchester United.
Qatari royal businessman Sheikh Jassim bin Hamad Al Thani wants to buy the 69 percent stake held by the Glazer family, as well as the remaining 31 percent. British billionaire Sir Ratcliffe, who already owns the Ligue 1 Nice club, has offered to buy a majority stake in the Glazer family, but he has not discussed buying shares from other investors at this stage.
TA detailed how the Glazer family will sell Manchester United from a legal perspective – given that the club is publicly listed on the New York Stock Exchange and registered in the Caribbean island's Cayman Islands.
Michelle Heisner, a corporate partner at Baker McKenzie, a New York law firm, explained that sometimes there's a clause that requires a majority of minority shareholders to vote to push for a merger.
But such a clause is unlikely to exist for Manchester United, and any potential mergers and acquisitions will be structured under the laws of the Cayman Islands.
In most cases, Cayman Islands law requires a simple majority or special resolution, i.e. two-thirds or more of the affirmative vote.
The Glazer family, which has 67 percent of the weighted voting power, passed the required threshold and did not require the consent of the other 31 percent to pass a resolution to sell the club outright. However, other shareholders will have the right to question whether the price they received is fair, which is known as dissent.
However, if you take into account the apparent rise in share prices since November, selling the club altogether could result in a lot of money being earned, depending on the different positions of the various stakeholders within Manchester United.