* Shares open 5 cents higher, then ease
* IPO priced $2 below bottom end of expected range
* Anti-Glazer fans jeer, hope for bidder to emerge
* Vice chairman says better mix of investors at $14
(Updates to close, adds share structure)
LONDON/NEW YORK, Aug 10 (Reuters) - Shares in Manchester
United Ltd made a flat stock market debut on Friday, a
disappointment for the world's most famous soccer club but one
it insisted would have no effect on its ability to acquire
Manchester United sold 16.7 million shares at a price of $14
each, below the expected range of $16 to $20, and shares closed
The stock never dipped below $14, held mostly in a five-cent
range and saw volume thin sharply after early trading. One IPO
expert said the team may have made a serious miscalculation
about the support it would receive.
"They overestimated the willingness of the fan base to go
buy the stock. So it's kind of sitting there right now," said
Francis Gaskins, editor of IPOdesktop.com. "If they don't have
any buyers now at this price, why would they have any buyers
A mystery to most Americans but a household name in most of
the world, the club listed on a U.S. exchange after pulling a
planned IPO in Singapore earlier this year. Finance experts
expressed some wonder that the offering went off at all, given a
share structure that lets the team's owners retain control.
"It's surprising to me that they got it away given the
structure. The ownership structure seems inappropriate to me for
this sort of company. I don't see much in it for the outside
investor who has no control," said Tim Jenkinson, a professor of
finance at the Saïd Business School, University of Oxford.
Following the offering, Manchester United will have a
dual-class share structure that will leave its owners, the
Florida-based Glazer family, with 98.7 percent of the voting
power, according to regulatory filings.
CASH FOR PLAYERS
The offering valued the 19-time English champions at $2.3
billion. The $233 million ultimately raised in the IPO will be
split equally between the 134-year-old club and the Glazers,
owners of the Tampa Bay Buccaneers NFL team.
Two of family patriarch Malcolm Glazer's sons rang the
opening bell on the New York Stock Exchange to start trading,
while two were on the trading floor -- surrounded by traders
standing on Astroturf and wearing Manchester United uniforms.
The loss of as much as $50 million in expected proceeds for
the club will be a blow as it copes with a debt burden and the
club seeks to buy new players, who cost tens of millions of
But one of the club's top officials denied that there was
any shortage of cash for player transfers.
"Clearly if you look at where we are today in terms of the
cash generative nature of the business and even more so
contractually going forward, we have huge firepower in the
transfer market," said Ed Woodward, vice chairman of Manchester
United, in an interview.
United had debt of 423 million pounds ($661 million) at the
end of March, which the executive said was its lowest in years
and also low relative to peers.
Some fans argue that the cost of the debt has forced up
ticket prices for the club, which draws sellout crowds of around
76,000 at its Old Trafford Stadium and claims 659 million
followers across the world.
A group of United fans who are campaigning for greater
involvement in the ownership of the club jeered the Glazers.
"It would seem all the analysis of the true valuation was
correct; the Glazers and their advisers were being far too
ambitious - or perhaps greedy - and the true value of the shares
should be around $10 rather than the $20 the Glazers were
seeking," said Duncan Drasdo, chief executive of the Manchester
United Supporters Trust (MUST).
MUST is calling for the Glazers to sell and allow fans to
play a greater role in the club's ownership, as well as for a
boycott of sponsors. United's commercial appeal was underlined
last week when it signed a $559 million deal with GM to
have the Chevrolet brand on its famous red shirts from 2014.
The Glazers bought United for 790 million pounds in a highly
leveraged deal in 2005, taking it private after 14 years on the
London Stock Exchange. Malcolm Glazer has been ill after a 2006
stroke, and his six children sit on the team's board.
"There are six siblings, and if one of them wanted to do
something small then they can. But I think they are committed
long term. All six want to stay involved," Woodward said.
United suffered a rare barren season last year, losing their
Premier League title to rival Manchester City, whose owner, a
member of Abu Dhabi's ruling family, has pumped 800 million
pounds into reviving what had long been United's poor relation.
Yet Forbes still ranks United as the world's most valuable
sports team by a wide margin. But with so much tied to winning
games, soccer clubs are an inherently risky investment.
"I didn't even look at it. I would never, ever invest in a
football club," said the head of UK equities at an investment
house running around 100 billion pounds in assets.
Italian champions Juventus is one of the few
European soccer clubs with a stock market listing, and it is
valued at only around $240 million, according to Reuters data.
But as one consultant noted, the ultimate goal of a sports
team is not to be a good business, but to win trophies.
"If there is one club to invest in it would be Manchester
United, but being the best economically among your peers may not
be enough," said Emmanuel Hembert of consultancy A.T. Kearney.
($1 = 0.6396 British pounds)
(Additional reporting by Sinead Cruise in London and Angela
Moon in New York; Writing by Keith Weir in London and Ben
Berkowitz in Boston; Editing by Will Waterman and Phil Berlowitz
and Carol Bishopric)