Manchester United Going Public

The football club is lowering its IPO price to $14 per share after criticism from Morningstar

Alanna Petroff 10 August, 2012 | 10:36AM
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Manchester United (MANU) is set to become a publicly traded company on the New York Stock Exchange on Friday, and now investors can get in on a piece of the action for a lower price. The football club reported that it would be selling shares at $14 each, which is below the $16-$20 price range that was previously announced.

This cut to the share price comes after criticism by Morningstar and other research firms. Morningstar currently believes the fair value of the company is closer to $10 per share, which is significantly below the reduced offering price.

In a report titled “Manchester United: Winning Team, Winning Brand, Challenging Valuation,” Morningstar analysts explained that while “the Manchester United trademark has considerable value, as it can be leveraged to secure sponsorships and broadcasting revenue and to sell numerous consumer products ... We preliminarily value Manchester United at approximately $10 per share.”

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Alanna Petroff

Alanna Petroff  is a financial journalist with Morningstar UK.