With a takeover looking likely, is now the time to be buying Man Utd shares?

Man Utd shares have rallied in recent weeks amid several takeover bids, but is now the time to buy? Gordon Best takes a look.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Diverse group of friends cheering sport at bar together

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

I have always been passionate about investing in companies that mean something to me. Whether this is a company building fantastic products, or developing amazing solutions, investment is the fuel that makes change happen. Owning shares in a sports team is no different. With Man Utd (NYSE:MANU) shares rallying, is it an investment for me to consider?


Manchester United is one of the largest sports franchises in the world, with historical success in English and European football competitions. Owned by the Glazer family since 2005, the company is 90% private, with 10% listed on the NYSE (New York Stock Exchange.).

The ownership has grown increasingly unpopular with the team underperforming on the pitch, winning no trophies since 2017. At the same time, rival teams invested heavily in their respective teams, stadiums, and facilities, gradually catching up with and overtaking Manchester United.

In 2022, the company was put up for sale.

Who is taking over?

At present, there are two frontrunners. One being INEOS founder and Britain’s richest man, Sir Jim Ratcliffe, and the other Sheikh Jassim Bin Hamad Al Thani, Chairman of Qatar Islamic Bank. 

Whoever takes the helm, it is likely to become the most expensive takeover of any sports team in history. But is now an investment opportunity? 

There is widespread speculation on an eventual takeover price, with estimates ranging from £3-7bn. With the share price currently $26.33, a successful takeover could see the shares move above $30 since £5bn takeover would value the shares at $30.47.

However, with the possibility of objections due to human rights issues in Qatar, or an unpalatable proposal to increase the company’s £680m debt, there are no guarantees. Speculation that the Glazer family may secure investment from US hedge fund Elliott Management adds to the possibility that the current owners will remain in control.

As a result, prospective investors must be comfortable with the potential of a deal collapsing or delaying significantly. 


Takeover speculation has fuelled excitement in the share price, almost tripling since July.

However, the fundamentals of the company are poor. Manchester United is unprofitable, has unsustainable debt, and under a year of cash runway. Without intervention, this is unlikely to change. 

Manchester United lost £126m in the last year. When considering the future cash flow, a fair value of $5.78 is calculated. As a result, the shares could be as much as 355% overvalued!


An investment in Manchester United with the current fundamentals is effectively speculation on a successful takeover.

If prospective buyers retreat, the share price would suffer tremendously. Some comparisons can be made to the 2022 Twitter acquisition. In both cases, rocky fundamentals may be overlooked by a passionate buyer, motivated to tackle problems, regardless of cost.

For my portfolio, I see an opportunity to buy shares at a price lower than the eventual takeover price. But I am conscious that if the deal were to collapse, I would face a major decline.

Saudi Arabia’s Public Investment Fund (PIF) purchase of Newcastle United in 2022 suggest that a deal is likely, but not without objections, potential delays, and several unexpected twists. I have added a small number of Manchester United shares to my portfolio, but will be paying close attention to the details of the takeover. 

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Gordon Best has positions in Manchester United. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Middle-aged Caucasian woman deep in thought while looking out of the window
Investing Articles

Should I buy these UK shares for my portfolio?

This Fool has been searching for ways to capitalise on the commodity moves via UK shares. Here’s what he’s watching.

Read more »

Illustration of flames over a black background
Investing Articles

Just released: April’s higher-risk, high-reward stock recommendation [PREMIUM PICKS]

Fire ideas will tend to be more adventurous and are designed for investors who can stomach a bit more volatility.

Read more »

A senior group of friends enjoying rowing on the River Derwent
Investing Articles

£9,000 in savings? Here’s a FTSE 100 stock I’d buy to target a £30,652 annual second income!

Our writer highlights one top FTSE 100 share that he thinks could help create a portfolio large enough for a…

Read more »

Light bulb with growing tree.
Investing Articles

62% down! Is the Ceres Power share price now a green energy bargain?

Annual results from the green energy firm showed a company on the cusp of doubling sales. So why has the…

Read more »

Investing Articles

3 mid-cap UK defence shares to consider buying in 2024

Defence budgets are soaring as global conflicts increase the threat landscape, so I'm examining the value proposition of three defence-related…

Read more »

Investor looking at stock graph on a tablet with their finger hovering over the Buy button
Investing Articles

Hargreaves Lansdown investors have been buying dividend stocks BP and Shell. Should I?

Cherished dividend stocks BP and Shell have outperformed the FTSE 100 index so far in 2024. Paul Summers takes a…

Read more »

Young Asian man shopping in a supermarket
Dividend Shares

A 5% yield? Here’s the 3-year dividend forecast for Tesco shares

Jon Smith flags up the positive momentum for Tesco shares following the release of the full-year results and looks at…

Read more »

Investing Articles

Yields up to 12.3% 3 top shares investors should consider for a second income

Searching for ways to make a market-beating second income? These popular dividend stocks are worth serious consideration, says Royston Wild.

Read more »