The world's richest soccer club Manchester United says it has received a takeover approach from an unnamed suitor, sending its shares higher and fanning speculation that U.S. sports tycoon Malcolm Glazer is poised to make a bid.
"This approach contains a number of significant conditions," the club said in a statement on Monday. "The company is seeking clarification of this proposal and at this stage it is unclear whether any offer will be made."
A source close to the matter told Reuters earlier on Monday that Glazer had hired U.S. bank J.P. Morgan Chase & Co to advise him on a possible bid for Manchester United.
"They are working with him, and there's a good chance he might have to say something," the source said.
Glazer, who already owns 19.2 percent of the world's richest soccer team, has lined up a bid worth at least 650 million pounds, the Financial Mail on Sunday said.
The newspaper, citing unnamed sources, said Glazer was expected to approach the club's board in the next few weeks with a highly leveraged offer, or an offer backed by a large amount of bank debt.
Manchester United shares were up 3.4 percent at 266 pence in late morning trade.
If Glazer were to mount a bid, he would be likely to seek the support of Manchester United's biggest shareholders, Irish racing tycoons John Magnier and J.P. McManus, who own a 28.9 percent stake.
A source close to the Irish tycoons' bid vehicle Cubic Expression reiterated the pair were long term investors.
"Nothing has changed," the source said.
PERSISTENT SPECULATION
United, which finished third in England's premier league in the 2003/04 season, has been the subject of persistent bid speculation since Glazer and the Irish tycoon's bid vehicle, Cubic Expression, have built up their stakes.
Another source familiar with the negotiations said that Magnier and McManus could be persuaded to sell their holding given that they have little interest in running a football club.
Glazer has also tried to get the two interested in jointly running the team, the source added, although other sources have said the two have not held talks.
The source said he was sceptical that Glazer will be able to raise enough cash to make a bid unless he sells his holdings in American football's Tampa Bay Buccaneers, or part of a portfolio of shopping centres that he has already put up for sale in the United States.
If Glazer raised his stake to over 30 percent he would have to make a full bid for the club under UK market rules.
In March, Glazer was forced by the UK's Takeover Panel to clarify his intentions towards Manchester United, after raising his stake to 16.7 percent. At the time, he said he had no current plans to launch a bid but said he might increase or decrease his stake over time.
Insiders at that time said it was clear Glazer was leaving the door open and could yet come back and make an offer for the club at a later stage.