New global corp sponsor revealed Sept 18th!!

[Scratch]

NEW FINANCIAL REQUIREMENTS

Clubs must submit independently audited accounts to the Premier League by 1 March each year with requirements to note any material qualifications or issues raised by auditors

Clubs must submit future financial information to the Premier League by 31 March each year as early warning for any club taking undue financial risk

An annual requirement to demonstrate to the Premier League Board that a club does not have outstanding debts to other clubs

An annual requirement to demonstrate to the Premier League Board that a club is not in debt with regard to income tax or National Insurance and payroll taxes


Could the bits i've highlighted demonstrate why the big clubs have spent less this transfer window, as a precursor to next years regulations?

[Bender]

Lets hope Rafa gets the lions share of this

[Redspin]

If that whole 4th place thing is the case, which I tend to believe, they will be bricking it because of City. They'll need to input more than they thought to keep that secure.

Why do you assume we'll suddenly drop from second and, rather than maybe go one better, will be worried about not getting 4th place, City (who'll finish about 6th) or no City?

[James P]

I'd trust a statement to the London stock exchange ahead of anything reported in a newspaper

It's never that straightforward - according to the Offal the debt in the Club at the point of acquisition was £60m:

The other £245 million will be at the holding company level and was used to refinance the £60 million of debt that was on the Club's books at the time of last year's acquisition as well as the loan related to the share purchase at that time. The overall financing is being supported by a combination of owner cash, letters of credit and personal guarantees totaling £225 million, ensuring that the Club remains on a sound financial footing.
Here

[Guest]

James P.

[Roboklopp]

Why do you assume we'll suddenly drop from second and, rather than maybe go one better, will be worried about not getting 4th place, City (who'll finish about 6th) or no City?

I dont- not this season anyway. I think we'll finish 3rd, but I was talking of risk. The Yanks have a certain risk tolerance to their plan & the whole City thing potentially threatens it in the medium term.

[Roboklopp]

It's never that straightforward - according to the Offal the debt in the Club at the point of acquisition was £60m:

The other £245 million will be at the holding company level and was used to refinance the £60 million of debt that was on the Club's books at the time of last year's acquisition as well as the loan related to the share purchase at that time. The overall financing is being supported by a combination of owner cash, letters of credit and personal guarantees totaling £225 million, ensuring that the Club remains on a sound financial footing.
Here

Regardless, the LSE is still more trustyworthy than the Offal in that respect.

[James P]

Regardless, the LSE is still more trustyworthy than the Offal in that respect.

Why? Both are simply reporting a statement made by the Club's representatives, so the information should be equally valid on both.

I think that I've worked out what the difference is. The LSE statement says
"Together with the £44.8m of net debt in the club as at December 31 2006, this represents an enterprise value for Liverpool of £218.9m."

Back in March 2007 the Echo reported

The Dubai based group are believed to value the club at £155 million and to take on a current contractual debt of £80 million plus fully finance the new stadium. Rumours suggest Gillett’s valuation of the club is at £170 million – this would be worth an extra £8 million for David Moores share of the club.


The difference would appear to be that the LSE statement identifies net debt, whereas the £80m is most likely a gross debt figure. On that basis, it is the £80m that best bears comparison with the £60m currently owed by the Club, so my point remains.

[dom9]

Sorry, but force them out and replace them with who, precisely?

The number of philanthropic billionnaires is pretty limited in the first place, and those willing to invest huge sums into a football club with no guaranteed return is even smaller.

Look at Mike Ashley - conservative estimates suggest that if he gets £100m for Newcastle (which is by no means guaranteed) he stands to lose circa £200m on owning the club for just a couple of years. That's a pretty damn expensive hobby, particularly when that hobby results in you becoming a figure of hate amongst a significant portion of the population. We football fans are impossible people to please - we want success, new signings, cheaper ticket prices, a new stadium and so forth, and many of those things are incompatible.

The likelihood is that any acquiring party will also require a degree of financing, and then we will simply be in the same situation as we are now.

I think that people are in danger of knee-jerk reactions here. If you look at the facts, things are not quite as black and white as some people think. The basis of the Americans' promises were:

World class signings - since they came on board we have bought Torres, Mascherano, Acquilani, Keane and Johnson, all costing north of £15m, plus the likes of Babel and Riera for not insignificant sums. The fact that we've managed to balance the books as well isn't bad. Before they joined, we had to beg / borrow / steal the £10m to buy Kuyt.

No borrowing on the club - strictly speaking they've followed this through. Before I hear howls of protest, do the sums (and I've got a full set of the Kop Holdings accounts in front of me, so these numbers are correct):
They paid £219m for the club, including debt (at the point of acquisition the club had debts of circa £80m). As at 31/7/08, there was £320m of debt in Kop Holdings, of which £60m was owed to Kop Football (Cayman) Limited, the parent company, and the rest to RBS. Of that, £60m was owed by the Football Club to Kop Holdings. Of that lending, £185m is personally underwritten by the owners.
What this means is that the Club's debt to the Holding company is actually LOWER than the debt was when they acquired it, and while the Club is certainly responsible for servicing the interest cost, they never said that it wouldn't be - after all, the Club is generating all of the revenue, so of course it has to service the debt. The debt itself sits mainly in the Holding company and the Cayman company, underwritten by Hicks and Gillett themselves, and there are strict rules in place regarding their ability to recall any debts from the Club - it is strictly forbidden if it would cause the Club to become insolvent. Any additional debt that the Club has incurred since the acquisition appears to have been the result of net transfer spending, which is what you'd expect.

Finally, the new stadium. No one really predicted the depth and severity of the current economic slump. Would you rather that we have embarked on a massively expensive project, financed at exhorbitant rates, or that we wait until such time that the project can be carried out cost effectively? I for one am glad that we aren't in the middle of such a development, because right now the banks are charging rates that would make you weep, and that's if they will lend at all. Part of my day job involves helping companies to get funding, and I'll tell you now, it's the hardest it has ever been. By and large the banks just aren't lending.

It's easy to jump up and down and shout 'Yanks out', but what are the real alternatives? I'm sorry, but the whole 'fans ownership' idea is ludicrous - the financing would never be sufficient, banks wouldn't touch the club with a bargepole, and governing by committee of thousands would be a nightmare. What we have at the moment isn't ideal, but it's the best port in a storm, and until something palpably better turns up, I for one won't be trying to hound the Americans into leaving.

Thank you, again.

[BrianF80]

The most important parts of Purslows interview is the bits below and highly significant considering we have broken even in the transfer market this season

Its clear that ANY future transfer budget must also include contract renewals and the wages of any players we might sign

“The commercial success of a football club is directly linked to your ability to invest in players,” he said.

“Both in terms of the wage bill, which is probably the single most important aspect, and the availability of excess cash to invest in the transfer market. For us to have such a substantial step up in our financial performance enables us to grow our investment in our players both in wage terms and in competitiveness in the transfer market.

You could be right, but remember our wage bill is getting on close to 100m a year (for each year of the contract i.e. 5 years = 500m) which dwarfs a one off 20-30m transfer spend, so a banker is always going to call it the most important aspect. Maybe we never managed the wage bill properly before.

[BrianF80]

We renew contracts every year but it hasnt stopped us spending at least £15 million NETT for the last 5 or 6 years until the last 12months when we have broken even in the market

To me theres lots of questions to be asked about where is the money going

Remember this is a company who according to its own accounts made £10 million profit (July 2008 accounts) whilst spending £15 million NETT in the transfer market

Since then our TV revenue over the last 12 months has reportedly increased by £10 million per annum, weve got in a couple of minor endorsements

Remember we've also seen players such as Hyypia, Alonso and Arbeloa leave in addition to bringing in Aquilani & Johnson and contract renewals

We've broken even in terms of transfer deals

Do you think we have spent £25-35 million solely on contract renewals??

Remember also wages would be spread over the length of the contract so any wage increases would be paid over a number of years

I just find it hard to believe when Purslow states we've spent £20 million NETT when the figures just dont add up to anywhere near that imo

Then he comes up with the above comment about that I highlighted to me it sets off alarm bells ringing and is a clear warning of some lean times in the transfer market

I hope I am wrong but I dont believe I will be

I tried to work out what the renewals would cost and couldn't get it to go much above 10m (when you included the 5.5% wage increase referred to and what we've saved on Xabi, Sami and Arbeloa's wages) and that was making some pretty way out assumptions like everyone who renewed got a 30K/week pay rise and that Aquilani and Johnson were on 100k and 140/week etc.

[BrianF80]

I'd trust a statement to the London stock exchange ahead of anything reported in a newspaper

Remember how Morgan used a slightly different definition of debt than Parry did and worked it out as 70m. Maybe the same definitional differences are at play here.

[kingfunk]

LONDON (AP) -Tom Hicks has promised to reduce Liverpool's debts and strengthen the squad after revealing the club expects to generate 26 million pounds ($43 million) from British bank Standard Chartered and Danish beer Carlsberg next season.

Dismissing concerns about Liverpool's financial health and poor start to the season, the American co-owner said in an interview with The Associated Press that the Reds have never been stronger on or off the pitch.

While Liverpool's accountants expressed doubt over the future of the club's parent company in the 2007-08 financial books, they also highlighted record revenue of 159.1 million pounds. Hicks also maintains that Liverpool operates as a "smart club'' unlike Manchester City, whose business plan he branded unsustainable after an offseason of heavy spending.

"You have to look cash flow rather than accounting and we intend to operate Liverpool where it has a very strong positive cash flow so we have the resources to be as competitive as possible on the pitch - that's our commitment,'' Hicks said in a telephone interview. "We had strong, positive cash flows last year. Our debts levels are at a very comfortable level and we are going to continue bringing it down.

"Our goal is to have less debt than any of the top clubs and that's a commitment we have made and will continue to make.''

Hicks, along with fellow American co-owner George Gillett Jr., reduced the club's debt to 250 million pounds in July. Manchester United, which beat Liverpool to the Premier League title last season by four points, has debt of 650 million pounds.

Manchester City's free-spending Abu Dhabi owner has spent more than 120 million pounds since May strengthening the team.

"It's not sustainable at City, they won't continue to invest like that as it doesn't make good economic sense,'' Hicks said. "Hopefully they will make the improvements they need to make and then run it more like a business. The smart clubs operate for the long term and you have to look at who have had success for many years.''

Liverpool announced a shirt sponsorship agreement Monday with Standard Chartered and a planned new arrangement with Carlsberg, which had been the club's primary sponsor since 1991.

"We are seeing for the first time the real power of the brand and the power of a well managed club,'' Hicks said. "I feel very good about the entire club. The total sponsorship contracts should probably bring in 25, 26 million pounds of incremental revenue a year. It's a huge development for the club.''

Standard Chartered will bring in at least 21 million pounds each year from the 2010-11 season by replacing Carlsberg on the shirts. Hicks expects the company to contribute even more than that as the bank acquires new business globally.

"It's not just the 21 million pounds that we will develop from the new sponsorship agreement with Standard Chartered because we will have an additional two or three million pounds for the Infinity part of the deal with Standard Chartered,'' Hicks said. "We have an existing contract with Carlsberg until the end of the season. Between now and the end of the season we will finalize new arrangements where we will retain the Carlsberg special sponsorship packages and pour Carlsberg products in the stadium. They will be one of our key sponsors, just not on our shirts.''

Hicks expects manager Rafa Benitez to be contacting him and managing director Christian Purslow about using some of the revenue to buy players in the January transfer window.

"Knowing Rafa Benitez I suspect he's got his eye on part of it,'' Hicks said. "As we build our revenues it gives ability to be more competitive on the pitch and, this is a very important one, but we think we have other opportunities in the future as well.''

Having already lost two games this campaign - the same number as in all of 2008-09 - the Reds are fifth in the standings, six points behind leader Chelsea.

"Everybody involved with Liverpool wants to win the Premier League, it's been too many years and it's our goal,'' Hicks said. "I've been in sport for 15 years and sometimes you have to do things to get the players' attention to wake up and really get focused.

"Maybe we have learned the lesson (from the losses), certainly the way we played Saturday (beating Burnley 4-0) showed that we have. We have stability and the nucleus of the team.''

Uncertainty lingered over Anfield last season as Benitez's contract negotiations dragged on, but he committed himself to the club until 2014 and key players like Fernando Torres followed him by signing new deals.

"Everything is very stable. I think the management situation at the club has dramatically improved,'' Hicks said. "There is a real sense of optimism.''

http://sportsillustrated.cnn.com/2009/soccer/wires/09/15/2080.ap.soc.liverpool.hicks.0823/index.html

[Kenneth]

Cool, well that's all fine and dandy then. Phew.

[Molby]

LONDON (AP) -Tom Hicks has promised to reduce Liverpool's debts and strengthen the squad after revealing the club expects to generate 26 million pounds ($43 million) from British bank Standard Chartered and Danish beer Carlsberg next season.

Dismissing concerns about Liverpool's financial health and poor start to the season, the American co-owner said in an interview with The Associated Press that the Reds have never been stronger on or off the pitch.

While Liverpool's accountants expressed doubt over the future of the club's parent company in the 2007-08 financial books, they also highlighted record revenue of 159.1 million pounds. Hicks also maintains that Liverpool operates as a "smart club'' unlike Manchester City, whose business plan he branded unsustainable after an offseason of heavy spending.

"You have to look cash flow rather than accounting and we intend to operate Liverpool where it has a very strong positive cash flow so we have the resources to be as competitive as possible on the pitch - that's our commitment,'' Hicks said in a telephone interview. "We had strong, positive cash flows last year. Our debts levels are at a very comfortable level and we are going to continue bringing it down.

"Our goal is to have less debt than any of the top clubs and that's a commitment we have made and will continue to make.''

Hicks, along with fellow American co-owner George Gillett Jr., reduced the club's debt to 250 million pounds in July. Manchester United, which beat Liverpool to the Premier League title last season by four points, has debt of 650 million pounds.

Manchester City's free-spending Abu Dhabi owner has spent more than 120 million pounds since May strengthening the team.

"It's not sustainable at City, they won't continue to invest like that as it doesn't make good economic sense,'' Hicks said. "Hopefully they will make the improvements they need to make and then run it more like a business. The smart clubs operate for the long term and you have to look at who have had success for many years.''

Liverpool announced a shirt sponsorship agreement Monday with Standard Chartered and a planned new arrangement with Carlsberg, which had been the club's primary sponsor since 1991.

"We are seeing for the first time the real power of the brand and the power of a well managed club,'' Hicks said. "I feel very good about the entire club. The total sponsorship contracts should probably bring in 25, 26 million pounds of incremental revenue a year. It's a huge development for the club.''

Standard Chartered will bring in at least 21 million pounds each year from the 2010-11 season by replacing Carlsberg on the shirts. Hicks expects the company to contribute even more than that as the bank acquires new business globally.

"It's not just the 21 million pounds that we will develop from the new sponsorship agreement with Standard Chartered because we will have an additional two or three million pounds for the Infinity part of the deal with Standard Chartered,'' Hicks said. "We have an existing contract with Carlsberg until the end of the season. Between now and the end of the season we will finalize new arrangements where we will retain the Carlsberg special sponsorship packages and pour Carlsberg products in the stadium. They will be one of our key sponsors, just not on our shirts.''

Hicks expects manager Rafa Benitez to be contacting him and managing director Christian Purslow about using some of the revenue to buy players in the January transfer window.

"Knowing Rafa Benitez I suspect he's got his eye on part of it,'' Hicks said. "As we build our revenues it gives ability to be more competitive on the pitch and, this is a very important one, but we think we have other opportunities in the future as well.''

Having already lost two games this campaign - the same number as in all of 2008-09 - the Reds are fifth in the standings, six points behind leader Chelsea.

"Everybody involved with Liverpool wants to win the Premier League, it's been too many years and it's our goal,'' Hicks said. "I've been in sport for 15 years and sometimes you have to do things to get the players' attention to wake up and really get focused.

"Maybe we have learned the lesson (from the losses), certainly the way we played Saturday (beating Burnley 4-0) showed that we have. We have stability and the nucleus of the team.''

Uncertainty lingered over Anfield last season as Benitez's contract negotiations dragged on, but he committed himself to the club until 2014 and key players like Fernando Torres followed him by signing new deals.

"Everything is very stable. I think the management situation at the club has dramatically improved,'' Hicks said. "There is a real sense of optimism.''

http://sportsillustrated.cnn.com/200...823/index.html

Hicks says the above (see bold), all very well in the board room....we could have the best balance sheet and P&L a/c in the premiership, but, correct me if i'm wrong - there is no league table of who has the best balance sheet and the least amount of debt.

I guess the point i'm trying to make is, the club's hierarchy should be about putting together the best possible squad possible - and backing our manager in the transfer market......agree anyone?