Manchester United Plc shares slumped in afterhours deals in New York after the football club’s American owners revealed plans for a US$186mln cash-out share sale.
Some 9.5mln existing shares held by members of the Glazer family will be sold, likely at a discount to the market price. The proposed transactions will see the Glazers divest the equivalent to 8% of their holdings in the club, leaving them with a 69% stake going forward.
It will be the latest Glazer share sale of the year, after Avram Glazer banked GBP70mln in March.
In September, United co-chair Joel Glazer said that the family would seek to make shares in the club available to fans during a conference call with fan groups following high profile protests that led to the postponement of a Premier League game against Liverpool.
The new share sale announced on Tuesday night is being run and underwritten by Bank of America (NYSE:BAC) Securities and there was no specific details regarding the possible purchasers of the shares.
Instead, the United statement said: “The underwriter proposes to offer the shares of common stock from time to time for sale in one or more transactions on the NYSE, in the over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices.”
Investors evidently baulked at the prospect of an ‘overhang’ of shares in the market, as the football club’s shares fell US$1.51 or 7.7% per share, to trade at US$19.62.
The stock being sold are Class A shares that were owned by the Kevin Glazer Irrevocable Exempt Family Trust and the Edward S. Glazer Irrevocable Exempt Trust.