Liverpool debt dispute forces Americans to consider sale

[carrsim]

Said weeks ago that Moores is having Kittens and Parry is out of his depth. I'm some fantasist idiot though

i was offline for a while over the holiday period so i think i missed a lot of the abuse that you have alluded to mate.

but as someone who has "known" you over the years i'd say that you were a regular idiot and there's nothing fanstastic about you

[Tom]

i was offline for a while over the holiday period so i think i missed a lot of the abuse that you have alluded to mate.

but as someone who has "known" you over the years i'd say that you were a regular idiot and there's nothing fanstastic about you

[JCase]

i was offline for a while over the holiday period so i think i missed a lot of the abuse that you have alluded to mate.

but as someone who has "known" you over the years i'd say that you were a regular idiot and there's nothing fanstastic about you

To be fair, Tom did take a lot of stick and was accused of being a doom monger amongsts other names when he posted info that all was not well with the club a few weeks ago.

[John_Gotti]

The fact of the matter is this: if Gillette cannot fund his bit, they both have to sell. If they lump it on the club, then Moores and probably Parry will resign from the board.

[AFII]

From RAWK....

1. Wachovia share price has fallen by a third in the period since they were approached to refinance the Texan (spits) deal;

2. Wachovia are announcing their 3rd quarter results this week.... expected to be very gloomy....

Roll on the subprime credit crisis in good ol freemarket USA.

Look out also for how the dollar goes in coming days.

Hateful I know, but the collapse of USA moneymarkets gives us our best chance of avoiding the mess to come.

[Skillz]

The fact of the matter is this: if Gillette cannot fund his bit, they both have to sell. If they lump it on the club, then Moores and probably Parry will resign from the board.

And that will leave two of the most despised owners ever of any sporting club in the world ever.

I would hope any bank thinking about loaning the money takes that into consideration. If these 2 stay on board we will be challenged strongly by Man City, Villa, even Everton () for 4th spot until the stadium is complete IMO.

DIC need to offer them a way out, give them a little profit to get them out and lets WALK ON.

[AFII]

BY THOMAS DUNMORE | world's game

North American sports moguls are fast finding that they may have bitten off more than they can chew with their purchases of enormously expensive English Premier League clubs operating in an alien sports culture.

Might they have found safer returns investing at home in Major League Soccer?

Malcolm Glazer (owner of the Tampa Bay Bucanneers) set the example with his leveraged purchase of Manchester United in 2005. This was bitterly opposed by fans, who resented that the massive debt burden placed on the club to fund the $1.47 billion purchase would ultimately be paid for by them. Thousands even abandoned support of Manchester United and founded a supporter-owned club, FC United of Manchester.

This week, Manchester United announced record annual profits of $119 million, yet this was tempered by the fact the club will pay out a similar amount just to service the interest on the debt albatross this year, with fans already burdened by higher season ticket costs. The debt also demands that Manchester United always finish in the top four of the Premier League in order to qualify for the money-spinning European Champions’ League. Should they ever stumble in this goal, the debt could easily spiral out of control.

n 2006, Randy Lerner (owner of the Cleveland Browns) bought Aston Villia for $120 million, a far less high profile and cheaper Premier League club. Lerner’s modest purchase, which did not require significant debt, has proved to be prudent. Fans have been pleased with his approach, a lesson not learned by the next Americans to invest in the Premier League, George Gillett (owner of the Montreal Canadiens) and Tom Hicks (owner of the Texas Rangers), who bought Liverpool for $430 million last year.

This was a purchase in the vein of Glazer’s takeover of Manchester United, a Champions League club bought at huge, debt-laden expense. Hicks foolishly said that “This business has to do with fan affinity and brand devotion. It doesn’t necessarily have to do with winning,” and the Americans have gotten on the wrong side of fans thanks to a public spat with popular manager Rafael Benitez over the club’s transfer policy. Unlike American sports, with no salary cap or luxury tax to restrict spending, inflation-fuelled binges see the top teams compete for high-priced talent in an unconstrained orgy of conspicuous consumption.

Hicks and Gillett have also discovered that funding a new stadium is not as easy in England as in the United States: public financing is unusual and real estate in a far more densely populated country costly. They have had to scale down originally ambitious plans for a new stadium, a major public relations embarrassment.

And this week, it became clear that Gillett and Hicks will likely be forced to sell Liverpool next month after failing to refinance the massive debt in the face of the global credit crunch.

By contrast, Major League Soccer offers less glamor and potential reward than the global playground the Premier League plays in, but a recent spate of new investors suggests it’s now deemed to be a smart investment with considerable potential for growth.

After years dependent on two billionaires, Phil Anschutz and Lamar Hunt, MLS has attracted the likes of Andell Holdings, a Los Angeles-based private investment firm who purchased the Chicago Fire for a little over $30 million last summer. In the same season, Toronto FC made their debut under the ownership of Maple Leaf Sports and Entertainment, majority owned by the Ontario Teachers’ Pension Plan.

The new investors are not simply drawn by a love of the game, but seek profit as Hicks or Glazer do. Richard Peddie, President and CEO of MLSE since 1999, has tripled the company’s enterprise value to $1.5 billion in nine years and knows his job is safe despite the failure of any of MLSE’s teams (Toronto F.C., the Toronto Maple Leafs and the Toronto Raptors) to win a championship in that time. As he told Forbes, “The sportswriters tried to get me fired, but now they figure I make so much money for the owners, I am bulletproof.”

Thanks to the tight salary cap (a little over $2 million) that keeps salary costs at a lower proportion of turnover than in the Premier League and the largely publicly-financed stadiums many MLS teams (including Toronto and Chicago) enjoy, it’s no wonder numerous investment groups are clamoring to join the league.

Expenditure beyond the salary cap is possible by signing a Designated Player: Andell inherited Blanco, whose presence basically pays for itself in increased ticket and merchandising sales for the Fire, but Toronto seem little inclined to splash out this off-season. After all, BMO Field is sold out of season tickets for 2008 already. And given over half the league makes the playoffs, a “successful” season to satiate Toronto fans in 2008 is possible without considerable investment.

Indeed, it could be a concern that whereas the Premier League demands madcap spending, profitable mediocrity could be too tempting for investors like MLSE (Maple Leafs fans will be familiar with this). But soccer fans will take that over the supernova failure of the NASL flame-out of the 1980s, and American sports moguls will likely invest more in MLS as a playing field far more familiar and secure than the casino capitalism of the Premier League.

JANUARY 16, 2008

http://www.csweekly.com/weeklyColumns/article/id/109

[AFII]

Position Board Members
Co. Chairmen G.N. Gillett Jnr and T.O. Hicks
Chief Executive R.N.Parry B.Sc, F.C.A.
Directors F.L. Gillett
T.O. Hicks Jnr
D.R. Moores
R.N. Parry BSc FCA

Hon Life President D.R. Moores
Hon Life Vice Presidents T.D. Smith
K.E.B. Clayton FCA
J.D. Burns
J.H. Cresswell ACA
Secretary W.B.Morrison
Manager Rafael Benitez

[Tom]

Where's Gillette in all this? He's very quiet isn't he?

[John_Gotti]

Where's Gillette in all this? He's very quiet isn't he?

When rich men are talking, the poor man has to keep quiet.

[Revo]

Where's Gillette in all this? He's very quiet isn't he?

all wrapped up in his nascar operations

[JohnDoe]

If this is true

[blacky]

That's 2 reputable broadsheets in the space of 4 days that have talked about a possible takeover. Love or Hate the press they have been fairly accurtae with what has gone on since this all kicked off in November.

[disco]

Very interesting article.

How on earth can anyone stop Hicks and Gillet putting debt on the club?
Who is this 'board' and why can't Hicks and Gillet just overrule them?!

[ronanm]

I always thought we sold the club on the cheap in any case - £270m or whatever is way too low considering the untapped potential and the fact that Spurs are being valued for more..