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Man Utd bond deal slammed

David Hellier
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MANCHESTER United’s controversial £500m bond issue was last night slammed as the worst performing launch of the past two years.

The bond, which is part denominated in sterling and partly in US dollars, has seen its price slide to 93p in the pound following worries over the club’s high debts and volatile revenue profile. The bonds are now yielding more than 10 per cent, compared to 8.75 per cent at the time of the launch last month.

Jonathan Moore, high yield analyst at Evolution Securities, said: “There’s been almost no traditional investor support for this issue and the company only got it away by conducting a round the world investor roadshow to attract high net worth individuals and foreign funds...it’s been the worst launch of the past two years.”

The sterling issue was supported at launch by one hedge fund that already had exposure to Manchester United debts. “That hedge fund provided an anchor to the issue but there was precious little other support around,” said another high yield analyst. Three hedge funds – Och Ziff, Perry Capital and Citadel – backed the takeover of Manchester United by the Glazer family. One City source said that the advisers to the bond issue, who include JP Morgan, Bank of America Merrill Lynch and Deutsche Bank, should clarify whether they have taken any of the bond holdings onto their own books.