Investment Trust Insider - Opening the door to investment trusts

Register to get unlimited access to our investor forum and all editorial content, including our e-zine and weekly email. Registration is free and only takes a minute.

Nick Train returns to Man Utd in first buy for two years

Nick Train returns to Man Utd in first buy for two years

Nick Train has added Manchester United to his Finsbury Growth & Income (FGT) investment trust, the first new holding in two years.

In his August update, Citywire AAA-rated Train said he was ‘delighted’ and ‘relieved’ to make the investment in the football club, which he expects to be a ‘very rewarding commitment’ of investors’ capital.

He accessed a block of quoted shares directly from the Glazer family, which has overall control of Manchester United (MANU.K), and paid just below $17 (£12.80) a share.

The purchase marks his first new buy for the trust since he bought shares in Remy Cointreau (RCOP.PA) in 2015.

It also represents a return to Manchester United, the investment Train has ranked as his best ever, with the manager having swooped on the shares when the football club listed on the London Stock Exchange in the 1990s, making around 30 times his money, before selling up in the Glazer family takeover in 2017.

Manchester United floated on the New York Stock Exchange at $14 in August 2012 and hit a high of $19.4 in 2014. United’s average share price since 2012 is $16.3.

The football club has a market cap of $2.7 billion  but only $700 million  is available to portfolio investors.

Train said he regarded United’s current market cap as low, ‘relative to the global following and fascination with the Manchester United franchise and to the priceless (virtually) strategic value to broadcasters of live sports’.

He quoted author James Montague, who wrote in his book The Billionaires Club that US investors see British football clubs as 'entertainment products; a studio from which a never-ending series every bit as engrossing as The Wire or The Sopranos plays out season after season. And the best bit? The network will never cancel it'.

In making his investment in Manchester United, Train highlighted NBA basketball team the Houston Rockets, which was sold for $2.2 billion last month.

He said: ‘If Manchester United is as valuable as the Rockets – and we think in truth its global reach makes it far more valuable – then it would command a value of well over $5 billion; more than double the current market capitalisation. This is the scale of the opportunity we see.’

Train is no stranger to investing in football clubs. As well as his previous foray with Manchester United, he also holds shares in Scottish champions Celtic (CCP) in the trust, and owns Italian champions Juventus (JUVE.MI) in his Lindsell Train Global Equity fund.

The Finsbury Growth & Income Trust is trading on a 0.4% premium and has a 1.8% dividend yield. Over three years the shares are up 53.7%, more than double the 24.6% return of the FTSE All-Share.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.