Dubai International to make bid for Liverpool FC

[Red Chilli]

Assuming Harris's story is true:

Even if refusing to sign ultimately cost Parry his job, surely DIC would make it worth his while? Not only could he be pivotal in the takeover, he could be pivotal in driving the price right down.

And if he does sign, how could Parry do his job anyway? As the Chief Exec, it isn't like he can shack up with Hicks and run the club from Dallas.

With almost unamimous opposition from the support, not even the slickest PR campaign can turn this around, can it?

I don't know, if Parry does have this opportunity I can't see why he would turn it down and sign the document.
I'm tending to think this story might be inaccurate.

[Venton]

I don't know, if Parry does have this opportunity I can't see why he would turn it down and sign the document.
I'm tending to think this story might be inaccurate.

True. I doubt that that G&H would put themselves in a situation where they could be voted down by Parry, doesn't really sound like them does it?

[baz87]

True. I doubt that that G&H would put themselves in a situation where they could be voted down by Parry, doesn't really sound like them does it?

I don't think they have an option. He's the CEO of the club and it would make perfect sense that he'd have to sign any document regarding the club.

[Alpha]

True. I doubt that that G&H would put themselves in a situation where they could be voted down by Parry, doesn't really sound like them does it?

It doesn't.

But when G&H bought the club last year, one of the most attractive features of the deal was the control that Parry and Moores would retain.

Is it possible that control could extend as far as Harris claims?

Last year, the existing board insisted that the initial one year loan would not be secured against the club. Could they also have had the foresight to insist on a casting vote when that loan was due to be refinanced?

[Venton]

It doesn't.

But when G&H bought the club last year, one of the most attractive features of the deal was the control that Parry and Moores would retain.

Is it possible that control could extend as far as Harris claims?

Last year, the existing board insisted that the initial one year loan would not be secured against the club. Could they also have had the foresight to insist on a casting vote when that loan was due to be refinanced?

It's possible but I would be amazed. I would imagine that they would have none voting shares. You never know though, Parry may yet surprise us all.

[Skillz]

Just want to throw this scenario out there and see what people think.

Currently Kop Ltd owe 298M (say 300M) and the club none AFAIK. After refinancing this changes to Kop 190M and the club 105M.

Lets assume G&H want 100M (50M each) profit. Based on this assumption DIC currently would have to pay Kop Ltd

Prior to refinance = 400M; or

After refinance = 290M (however they would have to take over the 105M of debt)

I am no expert on these matters but this makes sense to me and allows everyone to walk away relatively happy, DIC do not pay too much and the muppets get their profit.

Hope this makes sense and I also hope I haven't made a cock of myself but I read some posts last night before I went to bed saying some bankers felt the refinance made the takeover more attractive and it got me thinking.

Thoughts?

[baz87]

DIC would take on £160m in debt not £105m as surely the £55m the Yanks are said to be putting in of their own cash would have to be returned.

So total cost would be £450m.

DIC don't want the refinance for 2 reasons; firstly there's no immediate pressure on the Yanks to sell as the clocks not ticking on them, however if they can't afford the repayments (which i suspect) then the longer they leave it the worse their position is. And secondly DIC would have wanted to sort the finance out themselves; DIC would have far more bargaining power with the banks than the Yanks do and would get a much better rate but more than likely they would (as they've done with previous investments) use Dubai's state funds at a very low interest rate.

[Red Chilli]

DIC would take on £160m in debt not £105m as surely the £55m the Yanks are said to be putting in of their own cash would have to be returned.

So total cost would be £450m.

DIC don't want the refinance for 2 reasons; firstly there's no immediate pressure on the Yanks to sell as the clocks not ticking on them, however if they can't afford the repayments (which i suspect) then the longer they leave it the worse their position is. And secondly DIC would have wanted to sort the finance out themselves; DIC would have far more bargaining power with the banks than the Yanks do and would get a much better rate but more than likely they would (as they've done with previous investments) use Dubai's state funds at a very low interest rate.

If DIC took on any loans, they'd just refinance the debt and get a hell of a lot better interest rate than H&G.

[Skillz]

DIC would take on £160m in debt not £105m as surely the £55m the Yanks are said to be putting in of their own cash would have to be returned.

So total cost would be £450m.

DIC don't want the refinance for 2 reasons; firstly there's no immediate pressure on the Yanks to sell as the clocks not ticking on them, however if they can't afford the repayments (which i suspect) then the longer they leave it the worse their position is. And secondly DIC would have wanted to sort the finance out themselves; DIC would have far more bargaining power with the banks than the Yanks do and would get a much better rate but more than likely they would (as they've done with previous investments) use Dubai's state funds at a very low interest rate.

Cheers Surely though the 55M extra that the 350M loan creates would still be there so the 105M debt is actually only 50?

[baz87]

No its £160m minus the £55m of the yanks cash.

The £350m is broken down as £55m of the Yanks cash, £190m loan secured against kop football ltd and £105 secured against the club. Technically speeking if DIC were to buy the Yanks shares for £290m they would be also taking on £160m of debt (£55m to be returned to the Yanks and £105m to the banks). The £55m of the Yanks money would be returned so wouldn't cost DIC anything (i was just picking ). i.e it would technically cost them £450m but inreality it would only be £395m.

[baz87]

If DIC took on any loans, they'd just refinance the debt and get a hell of a lot better interest rate than H&G.

It would cost them a good few £m for them to complete another refinance. I guess it would depend on whether they felt that what they could save in interest repayments outweighs the cost of carrying the refinance out.

[Skillz]

It would cost them a good few £m for them to complete another refinance. I guess it would depend on whether they felt that what they could save in interest repayments outweighs the cost of carrying the refinance out.

The point of my original post was though it may be more attractive to all parties as DIC appear not to have paid as much for the club while G&H still get their profit.

Does that make sense? I realise there may be extra costs but it may be the way to keep all parties happy. The answer will come if DIC do bid and when I suppose.

[baz87]

The point of my original post was though it may be more attractive to all parties as DIC appear not to have paid as much for the club while G&H still get their profit.

Does that make sense? I realise there may be extra costs but it may be the way to keep all parties happy. The answer will come if DIC do bid and when I suppose.

Yea i know what your saying. There were reports a while back that DIC didn't want to be seen as over paying as it may affect future deals they do and providing G&H are willing to play ball then this could be the answer.

Its all going to depend on how much profit G&H want.

Like ive said previously i think its always been the Yanks plan to sell us on as i really don't think they have the cash to meet these repayments let alone the extra repayments for the increased loan for the ground. The refinance has given them more time to find themselves the best deal but its just a matter of time before they sell.

[Skillz]

Yea i know what your saying. There were reports a while back that DIC didn't want to be seen as over paying as it may affect future deals they do and providing G&H are willing to play ball then this could be the answer.

Its all going to depend on how much profit G&H want.

Like ive said previously i think its always been the Yanks plan to sell us on as i really don't think they have the cash to meet these repayments let alone the extra repayments for the increased loan for the ground. The refinance has given them more time to find themselves the best deal but its just a matter of time before they sell.

I am just trying to ready myself for the refinancing if it goes ahead in the hope DIC may still bid in the future.

[baz87]

I am just trying to ready myself for the refinancing if it goes ahead in the hope DIC may still bid in the future.

DIC will be back, how long it will take who knows but my guess is that G&H won't be able to keep these repayments up for more than a year or so and they know that too and they're looking to sell.

My guess is that G&H will be gone within the next 6-7 months, any longer and their position becomes weaker.