The very mention of football conjures up images of cheering fans from all corners of the world.
The global appeal of the game is undeniable, and it’s the strong support of fans that has propelled its growth into a multi-billion dollar industry.
Today’s infographic from Swissquote tracks how the sport has reached far and wide—even onto the stock exchange.
The Timeline of the Manchester United IPO
Manchester United is the largest publicly-traded football club in the world. The journey of its initial public offering (IPO) can be traced back almost 30 years.
- 1991: Man United floats on the London Stock Exchange (LSE)
It aims to raise £10 million, but falls short and finally raises £6.7 million. - 2003-2005: Malcolm Glazer acquires ownership of Man United
This raises the club’s market capitalization to £790 million, and it delists from the LSE. - 2012: Man United lists on the New York Stock Exchange
It aims to raise £62.8 million in this IPO, but surpasses this with a final raised value of £146.3 million. Interestingly, George Soros was the biggest investor in this deal, buying a nearly 2% stake in the club.
What makes a football team like Manchester United so attractive in the eyes of investors?
Over decades, a flourishing fan base from viewers to consumers has been the force behind the football industry’s success as a whole.
The Big Business of Football
FIFA, the international governing body of football, organizes and promotes all major tournaments. Its total revenue between 2015-2018 can be broken down into a few main components:
| Revenue Source | Amount | % of total |
|---|---|---|
| Broadcasting rights | €2,800 million | 48% |
| Marketing rights | €1,500 million | 27% |
| Accommodation and ticket sales | €600 million | 11% |
| Licensing rights | €500 million | 9% |
| Other revenue | €300 million | 5% |
| Total: €5,800 million |
In fact, 83% of this total revenue came from the 2018 Russia World Cup alone. This was viewed by approximately 3.6 billion people—nearly half the world’s population.
The World Cup’s revenue even rivals the combined strength of the top five European clubs. How do the five major clubs make their money?
| Club | Matchday | Broadcast | Commercial/ Sponsorships | 2019 Revenue |
|---|---|---|---|---|
| FC Barcelona | €159M | €298M | €384M | €841M |
| Real Madrid | €145M | €258M | €355M | €757M |
| Man Utd | €121M | €274M | €317M | €712M |
| Bayern Munich | €92M | €211M | €357M | €660M |
| Paris Saint-German | €116M | €157M | €363M | €636M |
| Total | €633M | €1.2B | €1.8B | €3.6B |
As viewership climbs, broadcasting rights furiously grow too—presenting numerous investment opportunities in sponsorship on the pitch and on the screen.
Cashing in on Clubs
Manchester United (NYSE:MANU) set a new precedent for publicly-traded football clubs—with a market cap worth near €1.8 billion today.
Following Man United’s example, other major clubs have since gone public across Europe. As well, Asia presents an emerging opportunity as the sport’s regional popularity expands.
| Club | Stock Ticker | Mkt Cap (Jul 31, 2020) |
|---|---|---|
| 🇮🇹 Juventus FC S.p.A | JUVE:IM | €1.19B |
| 🇩🇪 Borussia Dortmund | BVB:GR | €511M |
| 🇮🇹 AS Roma | ASR:IM | €320M |
| 🇬🇧 Celtic F.C. | CCP:LN | €108M (£97M) |
| 🇨🇳 Guangzhou Evergrande Taobao | NEEQ:834338 | N/A |
| 🇮🇩 Bali United | IDX:BOLA | €57M (Rp894B) |
China’s most valuable football club—backed in part by e-commerce giant Alibaba—closely matches the valuation of Manchester United.
In Southeast Asia, Bali United was the first team to go public in June 2019. Shares jumped 69% higher than the initial listing price upon its IPO. This move is already propelling more planned IPOs for more football teams in the region, such as Persija Jakarta—the 2018 Liga 1 champion—and Thailand’s Buriram United.
The Future of Football
Football has the power to stir passions and unite people—and it’s reinventing itself constantly.
The 2019 Women’s World Cup was the most watched in tournament history, with over 1.12 billion tuning in. FIFA plans to invest almost €454 million more into the women’s game between 2019-2022, and grow the number of female players to 600 million by 2026.
Additionally, the annual esports tournament eWorld Cup is taking place in Thailand in 2020—tapping into the esports boom in Asia, which hosts 57% of esports enthusiasts.
Any football fan will tell you that the beautiful game is more than just a sport. And for investors, there are a variety of ways to gain exposure to this market—meaning fans can be both personally and financially invested as it continues to grow.
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