Could Manchester United Increase Valuation With Offering Fans More Shares Or Selling The Team?

Ahead of its quarterly earnings report, soccer club Manchester United MANU might have some news that could help ease tensions between ownership and fans.

What Happened: Manchester United has held talks with Manchester United Supporters Trust over issuing a new equity class of shares that would include similar voting rights to Class B shares held by team ownership, Sky News reports.

The report says $10 million in shares could be issued by team ownership, designated specifically for fans. Current Class B shares have 10x the voting rights of the publicly traded Class A shares.

Reports also say that a new fan advisory board, which would provide a direct dialogue between club owners and team supporters, is being considered.

Manchester United could issue more of the new equity shares over time and some are reporting that the $10 million amount might be a test for the demand of shares.

“We are in advanced talks with MUST about a Fans’ share scheme which would open a path for fans to build, over time, a meaningful ownership stake in Manchester United,” a spokesperson told Sky News.

An agreement could be reached by the end of the year. Manchester United reports quarterly results Wednesday before the market open and could share more details.

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Why It’s Important: The signing of Cristiano Ronaldo was one of many reasons fans were excited for the 2021-22 Manchester United season. Fan expectations by the team haven’t been met, with Manchester United ranking sixth in the English Premier League with a 5-2-4 record and 17 points.

Despite the poor form in the league matches, Manchester United is tied for top of the Group F table in Champions League group rounds with a 2-1-1 record.

Ronaldo has four goals in eight EPL matches and five goals in four Champions League appearances this season.

Fans have rallied around calling for a managerial change from current team coach Ole Gunnar Solskjaer. The fans are also still likely upset from Manchester United's original plans to join the Super League earlier this year, which brought protests.

Based on the wording of the share offerings, it could become the Glazer family is ready to sell off their ownership in the team it bought in 2005 slowly. This could be a win for fans and for current MANU shareholders.

Manchester United shares have a market capitalization of $2.6 billion and an enterprise value of $3.2 billion. Sportico values the team at $4.65 billion, a value closer to what the team would be valued at if the Glazer family sold.

MANU Price Action: Shares traded flat to $16.02 on Monday. Shares have traded between $14.26 and $20.86 over the last 52 weeks.