The stock markets are losing interest in sport

There are clear signals that the world's stock markets are now losing interest in sport after burning their fingers with a series of flotations at the end of the 1990s. This has not stopped people in F1 talking about their desire to float companies, despite the experiences of some of those who did go to the markets. At one point there were no fewer than 20 soccer clubs listed on the London Stock Exchange but now only nine remain and the biggest of them, Manchester United, is rumoured to be on the verge of going private again with US sports marketeer Malcolm Glazer tipped to be close to a takeover bid. In recent days Glazer has been buying heavily. The value of soccer shares has been slashed by 66% in the last three years and many clubs have gone into administration. The remaining clubs are shifting to smaller exchanges to reduce the need to work constantly on compliance with tough stock market rules. It seems that the era of the sportin IPO is coming to an end. In racing that has been seen in America with the collapse of CART, with very little money being saved for the shareholders.

Formula 1 avoided what might have been a similar fate only because it proved to be impossible for Bernie Ecclestone to agree terms to float his company and so instead decided on a private sale, although this has left him with a considerable number of problems. The soccer clubs say that the money raised in stock market flotations was useful to help them build new facilities and expand operations and was also good for forcing the management to run the clubs in an efficient manner but none of them have been very successful in term of finance and the markets are going to be very careful before diving headlong into sport as a business in the future.

Having said that one must aslo note the success that has been enjoyed by US firms such as the International Speedway Corporation, which is still booming, thanks to the ever-increasing success of NASCAR.

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