Manchester United Slides 7% as Ratcliffe's Offer Comes Down to ...

(Bloomberg) -- Traders wagering on the long-running ownership saga at Manchester United are facing last-minute doubts on whether billionaire Jim Ratcliffe will close his purchase of a 25% stake in the football club this week.

Manchester United’s Class A shares fell 7% to $19.60 on Monday, after slidng as much as 10% earlier in the session, with Ratcliffe’s tender offer set to expire at midnight Tuesday. The company hasn’t disclosed the status of regulatory approvals, stoking speculation that the deadline will be extended. 

In December, Ratcliffe agreed to buy the stake by allowing investors to swap about one-quarter of their Class A stock holdings for $33 per share, well above the current market price. 

Read: Manchester United Saga Ends With $1.3 Billion Ratcliffe Deal

The stock price traded around the mid-teens in 2022 before takeover rumors started, whipsawing the value of the shares. While the price has slipped, the continued premium to its estimated market value suggests some anticipation that Ratcliffe’s offer will be extended.

“The selloff today points to a market implying about 50% chance of an extension in the tender offer,” according to Cabot Henderson, a merger-arbitrage specialist at JonesTrading. He estimated that if the deal were set to lapse, the stock would be trading near $17.

(Updates to show scale of intraday price decline in second paragraph.)

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