What happened
Manchester United(NYSE: MANU) reportedly got taken off the market because its controlling shareholders failed to receive their target valuation from bidding companies. Investors are disappointed, sending share prices of the storied English soccer club down as much as 20% on Tuesday.
So what
Few sports brands resonate globally the way Manchester United does, but it can be hard to put a precise value on that popularity. Last November the Glazer family, which controls the New York Stock Exchange-listed company behind the team, hired bankers to explore options for Manchester United.
At least two firm bidders emerged, but a report out Tuesday suggests the Glazers were not satisfied with the amounts offered. The Daily Mail reported that Manchester United has been taken off the market after bidders failed to match the club's 10 billion pounds ($12.58 billion) asking price.
Share prices of Manchester United spiked by more than 60% on the initial reports of a sale last fall, and remain well above where they traded prior to the sale talk.
Now what
This is just one report, but there has appeared for some time now to be little momentum around a sale. If confirmed, the stock could have further to fall. Shares of Manchester United still trade more than 40% above where they were prior to the deal talk.
The Glazers, according to the report, could try again to sell the club in the coming years, hoping a more stable economic environment will attract additional bidders. The English Premier League also continues to make strides in boosting global television revenue, and the 2026 World Cup in the United States could attract new interest, and dollars, to the English game.
But a lot could go wrong between now and then, creating risk for investors who are holding on in hopes of an eventual buyout. After nearly a year of waiting for a deal to be announced, Manchester United investors appear to be losing hope.
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