Dubai International to make bid for Liverpool FC

[carlton]

Tom Hicks and George Gillett close to new deal
By David Bond
Last Updated: 7:44am GMT 23/01/2008

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Liverpool's American owners, Tom Hicks and George Gillett, have been asked to provide an extra £50 million in personal guarantees to secure a £350 million refinancing deal with banks.

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After months of delays and growing uncertainty in the global credit markets, the Royal Bank of Scotland and America's fourth largest bank, Wachovia, are understood to have insisted on extra guarantees from Hicks and Gillett to secure the new loans.



Refinancing the deal: George Gillett and Tom Hicks
The fresh demand from the banks means that Gillett and Hicks are now being asked to put up a total of £225m to ensure the refinancing is completed, with each of the US sports tycoons providing £20m in cash, £37.5m in letters of credit and £55m in personal guarantees.

It is understood that with Gillett already struggling to put up the money required by the banks, the most recent conditions had raised new questions about the deal.

However, Hicks and Gillett are understood to have come up with the necessary assurances and it is expected that a deal will be signed and announced by the end of the week, possibly tomorrow.

Clinching the refinancing will go a long way to ending the momentum growing behind a £350m bid for the club from Dubai International Capital, who narrowly missed out in the race for Liverpool when Hicks and Gillett bought the club for £220m last February.

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Although DIC are unlikely to drop their interest in the long run, refinancing the borrowings used to buy the club will place Hicks and Gillett in a much stronger position to resist their advances.

That is likely to be extremely unpopular with fans now opposed to the American regime.

The deal with RBS and Wachovia will not only provide around £60m of working capital for the club's new stadium at Stanley Park and £20m to refinance loans used to buy players in the summer, but will also refinance a one-year loan taken out with RBS to pay for the Hicks and Gillett acquisition.

One of the reasons why the refinancing has taken so long has been Hicks and Gilletts' attempts to secure the new borrowings against the club instead of their assets.

A move to place all the debt on to Liverpool's books was blocked in the autumn by chief executive Rick Parry and former chairman David Moores, who remains a director, amid fears that it would saddle the club with big interest repayments.

Under the new deal it is understood that around half of the borrowings will go on the club with the rest being placed on Liverpool's parent company, Kop Holdings.

[Sarb]

Don't think anyone can underestimate how grave this situation is for LFC. Personally i was gutted when DIC pulled out the first time. This whole thing just seems all wrong now. Liverpool has been riddled with mis-management for a very long time and now it's we are paying the consequences in spectacular fashion.

I don't know where we go from here. Saddled with huge debt, the stadium is a farce just like it has been for the last 7 or so years. And we appear to have two owners that don't really want to keep the club but want to make as much profit as they can.

Apparently Foster has now left aswell. So there is going to be little or no communication. Rafa is a goner imo. Was apt seeing Moores and Parry on Wednesday. It was written all over their faces that they had made a mistake of huge proportions.

Doomed

[blacky]

Don't think anyone can underestimate how grave this situation is for LFC. Personally i was gutted when DIC pulled out the first time. This whole thing just seems all wrong now. Liverpool has been riddled with mis-management for a very long time and now it's we are paying the consequences in spectacular fashion.

I don't know where we go from here. Saddled with huge debt, the stadium is a farce just like it has been for the last 7 or so years. And we appear to have two owners that don't really want to keep the club but want to make as much profit as they can.

Apparently Foster has now left aswell. So there is going to be little or no communication. Rafa is a goner imo. Was apt seeing Moores and Parry on Wednesday. It was written all over their faces that they had made a mistake of huge proportions.

Doomed

I think to keep the fans onside H&G will offer Rafa a new contract but he will resign IMO. What decent manager would want the job with these 2 goons at the helm? Am very depressed this morning DIC SOS

[AFII]

There isn't any chance that Rafa will stay if G&H stays. He can't work under conditions that he may be sacked the next day just because Gillett or Hicks feels like doing it.

[tomasjj]

So it seems they are going to place at least half of the debt from the takeover on the club - contrary to promises made.

Lying cunts.

[kurtangle01]

So it seems they are going to place at least half of the debt from the takeover on the club - contrary to promises made.

Lying cunts.

Exactly. And as the other half of the debt will be against Kop holdings meaning that we still have to pay the full £30m in interest rates, I assume?

[Tom]

Smoke and mirror finances. As Kop holdings is the parent company of liverpool fc it can use liverpool fc as a means to finance it's half of the debt.

[gerbin11]

I've been thinking this more and more over the last couple of days, would it be in the LONG TERM interest of our beloved club to fail to qualify for the champions league this year. ( aside from the ramifications on Rafa )

Not that I want us to fail

A very sad day to be thinking these kind of things

[kurtangle01]

I've been thinking this more and more over the last couple of days, would it be in the LONG TERM interest of our beloved club to fail to qualify for the champions league this year. ( aside from the ramifications on Rafa )

Not that I want us to fail

A very sad day to be thinking these kind of things

No. Regardless of who owns the club we need to keep making progress on the pitch.

[sonsofthedesert]

No. Regardless of who owns the club we need to keep making progress on the pitch.

[Shanks65]

I've been thinking this more and more over the last couple of days, would it be in the LONG TERM interest of our beloved club to fail to qualify for the champions league this year. ( aside from the ramifications on Rafa )

Not that I want us to fail

A very sad day to be thinking these kind of things

Not sure about that mate.

If we fail to qualify, either Rafa or another manager will have much less money to play with, and without CL footy, we won't be able to attract the same calibre of player as the CL sides.

Therefore we'll be stuck with the current mediocre players, or we'll only have enough funds to bring in yet more mediocre players.

Then it'll be harder to get a top 4 place...

No matter who the owners are, or who the manager is, CL football is a MUST.

[gerbin11]

The point I am trying to make is this. Look at two scenarios.

1. we continue - we finish the league 4th and qualify for the champions league. H&G know they can now pay the interest payments and as such continue on there merry way fattening the albatros around the clubs neck. Getting even bigger loans to pay for the stadium, start ( as the Glazers have done) to start motgaging off the future season ticket sales to finance purchasing players, getting the club into debt it will satrt to struggle to pay. One season in the not too distant future we do manage to fail to qualify, suddenly our income drops our outgoins have spiralled. What happens then, Leeds's problems will look like a drop in the ocean.

2. We fail this season to qualify, the debt is £350 mil, we would still be a viable running concern for DIC, H&G would be forced to sell as they would struggle to make the repayments, as such would be panic selling and DIC would get the club at a reduced rate.

Which would you have, one seaon out of the premier competion or the future security of the club. This is all, of course depending on DIC failing to buy the club now. Believe me when I say I want this all to be conjecture and to have DIC buy the club now and us to carry on making the progress we all want.

[DeanoUK]

BBC now toeing the line saying similar things. Looking like we're stuck with them.

http://news.bbc.co.uk/sport1/hi/football/teams/l/liverpool/7203724.stm

Liverpool owners Tom Hicks and George Gillett hope to complete a £350m refinancing deal on Thursday to secure their immediate Anfield future.

City observers said on Tuesday the package was under threat, with Dubai International Capital (DIC), waiting in the wings with a proposed takeover bid.

But BBC Sport has learned that Hicks expects to seal the deal imminently.

The package is expected to help the American duo repay money borrowed for their £218.9m takeover in March 2007.

They would also then be able to repay loans used to sign players last summer and start work on a re-scaled plan for a new stadium in Stanley Park.

If the re-financing package, which has been agreed with the Royal Bank of Scotland and American bank Wachovia, goes ahead as expected, it will strengthen the Americans' position at Anfield.

And Hicks will also feel he will be in a stronger position should he decide to sell in the future, dealing a blow to DIC's hopes of mounting a swift bid to take control at Anfield.

Hicks and Gillett were the target of crowd demonstrations from Liverpool supporters unhappy with their regime during Monday's televised game against Aston Villa, with banners calling for DIC to mount a bid.

But Hicks, in particular, has remained defiant in the face of protests and insisted he had no intention of selling his 50% share in the club.

"I've not received any offer to purchase the club from DIC or anyone else, much less accepted any such offer," Hicks said on Monday.

It remains to be seen whether DIC, the investment arm of the Dubai government, will now pull out of a proposed bid to take control at Anfield, with the refinancing package unlikely to clear all the clouds of uncertainty over the club.

BBC Sport revealed on Saturday that DIC's interest had been seriously re-ignited and a potential bid was in place.

But it is believed DIC have made it clear they will not pay over the odds for Liverpool, and are not prepared to give Hicks and Gillett a huge profit if they sell.

Some City sources believe the new deal, and its interest payments, will only be a financial "sticking plaster" and DIC will wait to see if there are further problems for Hicks and Gillett while maintaining an interest in buying Liverpool.

Liverpool decided to sell to Hicks and Gillett instead of DIC in March 2007 but the American businessmen, and Hicks in particular, have been criticised for the way they have run the club.

Hicks admitted holding talks with Jurgen Klinsmann last November about the German taking over from Rafael Benitez as manager.

The owners and Benitez have also had a very public spat after the Spaniard criticised their transfer policy.

If Hicks has cemented his position via the loan, Benitez's long-term prospects look bleak.

And Liverpool fans will be even more critical after an interview, first broadcast on the Major League Baseball website six months ago, was publicised by the British press on Wednesday.

"People are worried that I might take money away from the Texas Rangers [Hicks' baseball franchise] to go to Liverpool," Hicks said.

"But it is just the reverse. Liverpool is going to throw off lots of extra money which, if I choose to, I can use for the Rangers or the Dallas Stars ice hockey team."

[Manofthebog]

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DIC and Rafa
« on: Today at 09:57:32 AM »

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Just heard on radio City sport that the chairman of DIC has said that if they do take over Rafa's job isn't guaranteed, and he's gonna have to prove he's the right man for the job!

[kurtangle01]

2. We fail this season to qualify, the debt is £350 mil, we would still be a viable running concern for DIC, H&G would be forced to sell as they would struggle to make the repayments, as such would be panic selling and DIC would get the club at a reduced rate.

All that would happen in that situation would be that the banks would take money that G&H put in as personal security to pay for the interest. G&H would then no doubt be looking to make that money back so they could potentially sanction the sale of a key player to do this.