Dubai International to make bid for Liverpool FC

[tomasjj]

I reckon Tony Barrett's name will not be underneath many articles where the owners are talking...

[disco]

Their loan is on the club, all of it, every single pound. Even their so called cash security and letter of credit.

How do you know this?

[AFII]

Their letter of credit and other assets of theirs.

They have taken a loan against the club for the above according to the Observer.

[disco]

Their letter of credit and other assets of theirs.

They have taken a loan against the club for the above according to the Observer.

Link? Would be interested to read.

Wouldn't change very much in terms of how they financed those loans, it would just force them to sell even more quickly if they were in trouble!

[Darkon]

Bit of a nothing article that

Well thank you for quoting the entire thing then

I hope we will soon get an answer to all the speculation, guess we still have to hold out untill DIC comes out with a statement - or perhaps Gillet... Untill then...

[CAD]

I dont understand why you continue to ignore the fact that in practice the club will be paying their acquisition debt, which in my book puts us worse off than under Moores. And out of interest who do you and Disco think will be footing the bill in the event of the very real prospect of the club's income not being sufficient to meet repayments? Will G&H dip into their pockets as per their guarantee or will club assets be sold? I know which one I am inclined to think will happen.

Selling of the clubs assests will only result in the club losing value dramatically. They will build the stadium and expect that the future growth in the PL will result in vastly improved revenue in 5 years time. On top the revenue from the new stadium will result in a greatly improved turnover. That's is what they are betting on. They could be wrong of course. But that's business. If they are wrong they will be forced to look for an exit obviously. People here are looking for ulterior motives. What could it be? It's is all their out in the open. They HAVE to invest big time in LFC to get the return they are looking for. To suggest that they won't build the stadium is braindead. It's ****ing stupid to even suggest it. Not even George Bush would entertain such a thought. That's how stupid it is. They will lose their entire investment if they don't build it.

What is Hicks saying:

"Of the £350m refinancing package put in place last week – £105m debt tied to the club – £45m will be used for future player transfers and to meet the club’s working capital needs, while £60m will provide start-up money for the new ground."

“I own three clubs and I have a real passion for all three of them. I think it’s great way to invest my money. I believe in what is going to happen with global television and internet growth for teams."

Aha - he's here because he expects he will make a lot of money in the future. He thinks that globalization will result in massive increased potential for LFC and football in general. Will he invest to make sure that he gets the best possible retun? Will he make sure that we stay competitive until the stadium is in place? Yes! Why? Because it's in his own best interest. He wants this club to succeed even more than we do. He has a three digit million interest ffs.

If LFC continues to make money before interest we will always be attractive for investors. If we do badly and fail to qualify for the CL or lose money in other departments it will only reflect directly on the exit and the money G&H makes when they sell. Worst case scenario is that we fall so low in the ranks that we wont make money before interests are paid. Again, G&H will then lose a lot of money or maybe only break even when the sell. Business is a gamble and of course things and events can ruin any given investment. They think LFC is a good gamble and they have just taken out a loan of about 250mill£ in their own assets. They will probably have to put up more for the next 250mill and they will be forced to do so. LFC can't carry that debt and they know it. They will have to finance LFC until the stadium is in place. To suggest that they are not prepared to do so is nonsensical. It's borderline lobotomy.

It's pretty ****ing straight forward. They have everything to lose if they don't get the turnover and revenue up. They know they have to invest to make it happen. They know they have to keep us at least in top 4 in the meantime

[AFII]

Link? Would be interested to read.

Wouldn't change very much in terms of how they financed those loans, it would just force them to sell even more quickly if they were in trouble!

DIC 'still intent' on Liverpool takeover


Duncan Castles
Sunday January 27, 2008
The Observer

Dubai International Capital remain intent on a takeover of Liverpool, regardless of their disappointment with the nature of the £350million refinancing deal with which the club's American owners have secured their immediate tenure there.

Tom Hicks and George Gillett Jr announced the new 18-month 'market-rate' loan on Friday, the former describing it as 'a strong vote of confidence in the club's financial strength'. DIC, however, regard it as an expensive holding measure that will cost the club around £28m a year in interest, yet fail to solve Liverpool's requirement for significant new capital.

Underwritten by the Royal Bank of Scotland and US bank Wachovia, the loan provides limited additional resources for a club in need of significant investment in the playing staff and a new stadium expected to cost a further £300m. As Liverpool's total debt stood at £297m before the refinancing package was agreed, it delivers a maximum of £53m of new money. Around £20m is thought to have been used up by the arrangement fee on the new loan.

While concerned club officials insisted that £245m of the debt was placed against Hicks and Gillett's holding company Kop Football Limited, it is understood that interest payments will be made entirely from club income. As such these will swallow up almost all of Liverpool's projected profits for the 2007-08 financial year.

Though the banks required Hicks and Gillett to increase their personal guarantees on the debt to £225m, it is understood that the Americans have not spent any of their own money on the club with the £20m equity each had to inject into the new deal coming in the form of personal loans, repayable by the club to them in the event of a further takeover.

The new 71,000-capacity stadium at Stanley Park will not be realised without another large tranche of debt. Though the stadium design announced on Friday has been downgraded from architects HKS' original proposal, it is still expected to cost a total of £350m. A spokesman for Hicks said that £50m of that sum has already been spent on consultancy and design. Further planning permission is required on the new structure.

DIC consider the refinancing a waste of club money that could have been spent on the team or the stadium and attempted to prevent it by offering to buy the club for £500m last week. Sources at the Arab investment group insist that Hicks and Gillett indicated their intention to sell during takeover talks, but only after the new loan had gone through.

Led by Liverpool supporter Sameer Al Ansari, DIC thought it had agreed a deal to buy Liverpool in late 2006, only for majority shareholder David Moores to sell to Hicks and Gillett. The Americans paid £174.1m for the shares, taking on outstanding debts of £44.8m and undertaking not to borrow any money against the club. On Friday, Kop Football Limited restated that debt at £60m.

Hicks also moved to reassure Rafa Benítez of his 'continuing and enthusiastic support' as manager, after earlier admitting that he had talked with Jurgen Klinsmann about replacing the Spaniard. Benitez has said little about the refinancing, though he suggested his desired £17m full transfer of Javier Mascherano would have to be partially funded by Mohamed Sissoko's proposed sale to Juventus.

Asked last night if Hicks now intended to sell Liverpool, his spokesman said: 'Tom Hicks is not a seller of Liverpool Football Club and he is certainly in it for the long term.' He declined to comment on how interest payments on the £350m would be funded, how much new money would be available to Liverpool, or whether the owners had invested any of their own cash in the club. Gillett, unhappy with some of his partner's recent actions, has yet to comment publicly on the revised plans.

http://observer.guardian.co.uk/sport...247773,00.html

[Roboklopp]

It IS relevant, as I assume the club can only pay a dividend (i.e. pass money from club to holding company) if it’s made a sufficient profit – need an accountant to clarify this.

Their loan is secured by letter of credit and other assets of theirs, so it is not on the club.


Any accountant worth their salt would be able to negociate around this osr of thing from what I understand.

I don't know what you do, but if you don't like (trying to) explain it perhaps you're in the wrong job

I might give you that one. I calculate & analyse performance & risk for investment funds, so it's not directly relevant in this case, but from what I understand/have researched with collegues the division is basically nominal.

[AFII]

Sorry, got it wrong about the against the club thing, it was against a future takeover.

[CAD]

Here we go again. The loans are against the club and the parent company whose only asset is...the club. Any division is nothing but nominal.

Utter nonsense. KTH only assets is not LFC. It has 250mill£ collateral from G&H.

Hello? They have put up assets to ensure the 250mill£. They will both have to go bankrupt for the debt to get anywhere near us and even then it would still be one hell of a legal battle.

That debt is in no way ours. What is it you say you do for a living?

[Alpha]

This has been doing the rounds on a few forums. Not sure who wrote it but he is apparently well known and reliable. Plus it ties in with what a few others have been writing recently.

The goings on within Anfield at the moment are quite outstanding.

Let me be clear from the off –

D.I.C or Dubai International Capital – Remain intent on securing Liverpool.

Regardless of what Tom Hicks said on Sportsweek on Sunday morning, which for me was at best vague, there remain serious divisions between Hicks & George Gillett.

George Gillett did sign the new finance deal, as so to safeguard his own ‘investment’ (loosely used term there) – but the relationship between the pair is at crisis point.

George Gillett’s son has LEFT Anfield at his fathers request & it’s understood by those within Anfield, he will not be returning.

George Gillett was said to be ‘outraged’ by Hick’s public comments about the approach made for Jurgen Klinsmann & pulling his son out from Anfield was a public show of his anger.

However with Foster leaving, big problems will arise as he was responsible for all the communication between the American owners & Roffa’.

I understand he got on very well with Foster & he was responsible impart for Benitez not walking out just recently. Benitez was made aware he had Gillett seniors full support, where as Hicks, as I said in another post – wanted him sacked.

Gillett vetoed the move & a power struggle ensued.

Gillett’s refusal to back Hick’s caused problems, on top of the big problems that already exist due to the financing.

George Gillett is it seems quite a decent chap. From the people I have spoken with who know him or have knowledge of him, he sounds affable, charming & I suppose most importantly, has a genuine liking for Liverpool.

Gillett wants to remain true to his word. When he promised Mr. Moore’s & the board members, his intention was not to saddle the club with debt, he meant it, but when he was gifted his opportunity to buy Liverpool, it fast became obvious he wouldn’t be able to do it on his own.

He’s paper rich – not cash rich, so as a result he approached Tom Hicks & a plan was put together quicker than a weeks holiday & the lack of initial groundwork is proving severely ill-advised.

George Gillett is said to favour doing a deal with D.I.C, as he has realised the ‘Project’ is going to prove impossible with the limited finances they have.

He understands that:

Yes – they have the money to as Tom Hicks said ‘Start digging’ but that is just about it. They do not have the means to pay for a further minimum £300+ million it will take to complete the stadium.

This is something that Tom Hicks is all too well known for.

Promising the earth – delivering nothing.

Many thousands of Texas Rangers fans would testify to that.

Promising to build the worlds best this and that’ – instead bleeding the companies of every single Dollar, Dime & Cent.

He sells club assets – from the clubs land to the best players. He minimizes wage bills & raises costs for real fans astronomically.

For any Liverpool fan who wants to see the degree of hate felt towards this man – read this:

http://rangersorrobbers.wordpress.com/2007/07/11/rangers-fans-against-hicks/

Many people are of the view that it is only a matter of time before George Gillett makes public his intention to do business with D.I.C.

Gillett knows if he forces Hicks to sell his share of Liverpool to him, then he can sell the whole package on to D.I.C, which in turn will stand to make Gillett a massive profit.

He is the one individual who can realise D.I.C’s dream.

Mr. David Moore’s held recent meetings with Gillett, with the sole intention of making it clear how deeply he disapproves of what’s gone on at the club in recent months & weeks.

He called on Gillett to honour the original terms of the takeover & has even sought legal advice, even though that avenue would achieve little in real terms.

Moore’s is seriously worried his name is turning to mud in Liverpool & is determined to win back the fans he still regards as his own. He doesn’t want to go down in Liverpool’s proud history as the man that managed to help sink Liverpool FC.

When Moore’s made his feelings known to Gillett, Gillett promised he would either live up to the original promise but if that proved impossible, he would look to do a deal with Dubai International Capital.

My friend told me Moore’s was promised Tom Hicks does not & would not have carte blanche over what happens to Liverpool.

Only last week discussions between Tom Hicks, George Gillett & D.I.C regarding the sale of Liverpool FC were ongoing – regardless of what Hicks claims.

Those negotiations are said to be ongoing as we speak.

D.I.C are determined to gain hold of Liverpool, but do not want to be seen or be perceived to be paying massively over the odds for the club. They think that would set a dangerous precedent & send out the wrong message to people who they deal with in the future.

But no matter how vitriolic the statements Hicks makes regarding selling, the facts are:

He is hanging on to his piece of Liverpool by a thread.

When D.I.C make there move and come to agreement with Gillett, Hicks will have no choice but to re-evaluate his options.

So Liverpool FC Fans.

Don’t panic.

There really is a bright light at the end of this ugly tunnel & that light in the form of D.I.C will make recent events pale into insignificance & resign Tom Hicks to his rightful place:

The history books.

[Roboklopp]

Utter nonsense. KTH only assets is not LFC. It has 250mill£ collateral from G&H.

Hello? They have put up assets to ensure the 250mill£. They will both have to go bankrupt for the debt to get anywhere near us and even then it would still be one hell of a legal battle.

That debt is in no way ours. What is it you say you do for a living?

Aaargh, you posted just before I left.

Loan is againt parent company Kop Holdings mate as I understand it. Kop Holdings only owns us & nowt else.


Please refrain form responding to me for the next 90 mins whilst I chuck some serious weights around ta.

[disco]

Good post CAD

It's odd, but interesting, that opinions are so polarised based on the same information.

[CAD]

Good post CAD

It's odd, but interesting, that opinions are so polarised based on the same information.

Cheers Disco

I think most people have a poor understanding of how investment works.

[disco]

Cheers Disco

I think most people have a poor understanding of how investment works.

I don't know if understanding is the right word, but yes people seem to object to them using club money for debt repayment, but (presumably) wouldn't object if they invested in cash and took a (larger) return.

Having said that, I'd personally not be impressed if player purchases were compromised so that the club could pay for THEIR share of the loan, but time will tell on that one.