updated 10/7/2003 11:22:52 AM ET 2003-10-07T15:22:52

Two Irish racehorse magnates seized nearly a quarter of Manchester United on Tuesday by buying TV firm BSkyB’s stake, leaving the English soccer champions more vulnerable to a takeover.

Manchester United confirmed a Reuters report that Rupert Murdoch’s BSkyB sold its 10 percent share of one of the world’s richest soccer clubs to Irish racing millionaires J.P. McManus and John Magnier, lifting their stake to 23.15 percent.

The $104 million deal fed talk that United could fall prey to a bid, as did London rivals Chelsea, and shares in the club raced to a three-year high.

With BSkyB out of the picture and many shares concentrated in fewer hands, the goal is opening up for potential bidders.

A source familiar with the situation said McManus and Magnier had no plans to buy the club. By law, they would be forced to launch a bid should their shareholder hit 30 percent.

McManus and Magnier’s investment vehicle Cubic Expression declined comment. Both men have been close associates of United manager Alex Ferguson, but newspapers have recently reported tensions between Magnier and Ferguson over their jointly owned champion racehorse Rock of Gibraltar.

Manchester United shares jumped as much as 8.5 percent. At 11:00 a.m. ET they stood 6.2 percent higher at $4.15, valuing the club at around $1.06 billion. New Chief Executive David Gill and Finance Director Nick Humby joined the buying, picking up a total $116,000 worth of shares at $4 each as part of a performance related bonus scheme.

“They are definitely in play now,” said Stan Lock, broker at private client stockbroker Brewin Dolphin.

Clean exit
BSkyB offloaded its 26 million shares in Manchester United for $3.97 each. The deal ends the broadcaster’s involvement with the club that regulators blocked it from buying for $3.99 a share in 1999.

Takeover rumors have intensified around Manchester United since Roman Abramovich bought London rivals Chelsea and began pouring more than a hundred million pounds into buying star players.

Investors including U.S. sports magnate Malcolm Glazer, owner of Super Bowl champions the Tampa Bay Buccaneers, and the billionaire behind reality TV show “Big Brother” John de Mol have been gradually building their stakes in United, although the club has insisted there have been no bid talks.

“The Russians are still in the background, the American is still picking them up, and now it looks like the Irish picking them up. It could be a free-for-all,” Lock said.

Behind new top shareholders McManus and Magnier, Scottish mining millionaire Harry Dobson has around 6.5 percent, Glazer has 5.9 percent, hedge fund Lansdowne Partners has 5.2 percent and de Mol has 3.5 percent.

Manchester United shares have rebounded after hitting a low of $1.41 last November. Analysts said BSkyB had timed its exit well, and added the move was no surprise given it was blocked from bidding for the club.

“They’re out clean at a good price. There was no use in them holding them apart from as an investment, and not long ago the shares were at $1.50, so to get out at $3.97 is not bad,” said Brewin Dolphin’s Lock.

Copyright 2012 Thomson Reuters. Click for restrictions.

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