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08/07/2023 20:26

Man United takeover overvalued by £2.5bn as Glazer ‘premium’ revealed

Qatar’s bid for Man United overvalues the football club by around £2.5billion, Football Insider has been told.

The Glazer family are still yet to decide on the new owner of the Red Devils, with Sheikh Jassim and Sir Jim Ratcliffe going head to head in a takeover race.

The Qatar bid for the club intends to buy 100 per cent of the club’s shares and remove the debt amassed by the Glazers during their 18-year ownership.

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Football Insider revealed on 16 June that Qatar are ‘very confident’ that they will succeed in their takeover of the club.

After multiple rounds of bidding, it was reported that Jassim submitted a late bid worth around £5.5bn, which included £1bn to remove the club’s debt.

In contrast, Ratcliffe’s bid was for a little over 50 per cent of the club, allowing Joel and Avram Glazer to retain around 20 per cent of the club.

The club was first put up for sale in November, and The Times reported that the Glazers’ initial valuation of United was between £6-8billion.

However, Viva Mukherjee, a chartered accountant and football finance analyst, told Football Insider that even Qatar’s £5.5billion bid is an overvaluation of the club.

“There are 54,500 ordinary A shareholders and the Glazers own 110,000 of class B Shares at Manchester United,” he said.

“Today’s share price sits at around $25, but the market value has soared to over $26 when we have seen reports about Qatar winning the bid.

“ If the Glazers sold at the same rate as the stock market, the value of the club would sit around £3bn to £3.4bn.

“However, there is likely a premium for the Glazers’ shares – estimated at around 20 per cent the value would total between £3.4bn-£3.9bn.

“The latest bid of Sheikh Jassim is well in excess of the market value before even taking into account the investment in servicing the debt.

“Even when using the Markham model to value the club, the estimated value of Manchester United before the effects of Covid-19 was only £2.4billion.”

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