According to a filing with the U.S Securities and Exchange Commission, Soros through his hedge fund Soros Fund Management LLC, owns 7.85% of Manchester United’s Class A shares, or about 1.9% of the entire club.
That 1.9% translates into 3,114,588 “A” Shares, which is a pretty significant 18.7% of the shares sold in the IPO. At a price of $14 per share, the Soros family paid $43.6m for this stake. At yesterday’s closing price of $13.06, the stake is now worth around $40.7m.
What is surprising is that Soros is taking a large stake in United’s “A” Shares which have very little voting rights. The Glazers still control 98.7% of the voting rights according to Andersred.
So why is Soros so interested in United? He is interested in the team’s lucrative media rights deals, said Philip Hall, a partner at New York-based investment bank Inner Circle Sports which has advised on high-profile English Premier League takeovers including Fenway Sports Group’s acquisition of Liverpool.
“This could be a play by Soros on the strength of Manchester United’s brand and the English Premier League’s growing media rights,” Hall said. “The domestic rights are set to increase 70 percent for the ’13/’14 season and the international media rights, set to be announced in late October or early November, are also expected to come in at a very robust uplift.”
Soros in buying into United because he thinks he can make money. But wouldn’t a more sensible approach be to buy some of the Glazer shares, and take a real ownership stake in the club with voting rights, instead of buying shares that are publicly traded?