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FSG are not shit


Dave D
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2 minutes ago, Jairzinho said:

Felt for a while that FSG are going to price themselves out of selling the club.

I think the only reason they'd do that is because they don't want to sell. Obviously pretty much everything has its price. That price will have to pretty staggering though.

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7 minutes ago, Jairzinho said:

Felt for a while that FSG are going to price themselves out of selling the club.

 

As others have said, why would anyone buy the club for two billion?

 

What was that Forbes valuation based on? Usually, company valuations are based on projected revenues, profits etc. 

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Well, there must be some value for investors... e.g. if LFC is projected to be worth between 2.5 - 3 billion in 10 years, based on the fact that a club of this stature will command certain revenues, sponsorship deals etc. which would be expected to grow further beyond the 10 years, there is a reasonable assumption you will find a buyer in that range in 10 years.

So it makes sense to invest 1.9 billion to make 600 million to 1 billion reasonably risk free and benefit from being the LFC owner (whatever they perceive as benefit from ownership, I don't entirely get it, but City owners obviously do).

If you buy a mid table club for 500 million and invest 1,4 billion, there is no guarantee you will successfully turn it into a PL top 6 or Top 3 clubs which would be worth 1.9 billion to a prospective buyer, since you will have to increase the fan base, and for this you will need continued success and exposure. I don't know how many fans Leicester gained on the basis on one PL title outside Thailand and that area. and to have continued success with a mid-table team, you need to invest a lot, If you can structure the deal that you are buying LFC with bank loans and similar, it can make sense.

Otherwise it would be like saying why buy Apple or Amazon for however it would take now, lets buy a mid-table company and than pour money into R&D and marketing.  If you already have a huge army of supporters, it translated directly into a portion of your expected revenues.

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They want to get a move on. After the debacle in the week Id imagine any potential buyers will point out the "massive" rebuilding project required on the pitch.

 

Not to mention the lost champions leagues projected profits from reaching the semi final at the very least.

 

Hypothetically

 

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1 hour ago, SasaS said:

Well, there must be some value for investors... e.g. if LFC is projected to be worth between 2.5 - 3 billion in 10 years, based on the fact that a club of this stature will command certain revenues, sponsorship deals etc. which would be expected to grow further beyond the 10 years, there is a reasonable assumption you will find a buyer in that range in 10 years.

So it makes sense to invest 1.9 billion to make 600 million to 1 billion reasonably risk free and benefit from being the LFC owner (whatever they perceive as benefit from ownership, I don't entirely get it, but City owners obviously do).

 

 

If you buy a mid table club for 500 million and invest 1,4 billion, there is no guarantee you will successfully turn it into a PL top 6 or Top 3 clubs which would be worth 1.9 billion to a prospective buyer, since you will have to increase the fan base, and for this you will need continued success and exposure. I don't know how many fans Leicester gained on the basis on one PL title outside Thailand and that area. and to have continued success with a mid-table team, you need to invest a lot, If you can structure the deal that you are buying LFC with bank loans and similar, it can make sense.

 

 

Otherwise it would be like saying why buy Apple or Amazon for however it would take now, lets buy a mid-table company and than pour money into R&D and marketing.  If you already have a huge army of supporters, it translated directly into a portion of your expected revenues.

 

 

Always thought the smart money is in buying a club like Forest or Villa with a biggish local fan base, and history of success. Cost relative peanuts and potentially could be worth three or four times as much within a couple of years.

 

Also think that if you get the managerial appointment right you can overachieve (relatively) in a way that isn't possible in the Premier League. Consistently, anyway. Leicester is the obvious huge outlier. With a club like that surely you fuck off a year or two after cashing in on the huge success (feels a bit shit talking about Leicester in this regard for obvious reasons).

 

The Championship is now full of clubs with shit managers spending tens of millions on shit footballers. Often just recycling them among themselves in much the same way that the shitter Premier League clubs do. A quality manager can transform a club. And pretty quickly.

 

Ashley is doing something similar but in the Premier League. 20th for spending, but with the 6th or 7th best manager.

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16 minutes ago, Jairzinho said:

Always thought the smart money is in buying a club like Forest or Villa with a biggish local fan base, and history of success. Cost relative peanuts and potentially could be worth three or four times as much within a couple of years.

 

Also think that if you get the managerial appointment right you can overachieve (relatively) in a way that isn't possible in the Premier League. Consistently, anyway. Leicester is the obvious huge outlier. With a club like that surely you fuck off a year or two after cashing in on the huge success (feels a bit shit talking about Leicester in this regard for obvious reasons).

 

The Championship is now full of clubs with shit managers spending tens of millions on shit footballers. Often just recycling them among themselves in much the same way that the shitter Premier League clubs do. A quality manager can transform a club. And pretty quickly.

 

Ashley is doing something similar but in the Premier League. 20th for spending, but with the 6th or 7th best manager.

The 6th or 7th best manager has them as around the 16th or 17th best team. Not a go at Rafa per se but evidence of how shitloads of money is needed to even hang onto the coat tails of european qualification wannabes.

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1 hour ago, VladimirIlyich said:

The 6th or 7th best manager has them as around the 16th or 17th best team. Not a go at Rafa per se but evidence of how shitloads of money is needed to even hang onto the coat tails of european qualification wannabes.

They finished in the top half last season.

 

Anyway, the aim for 14 teams in this league is to finish 17th. The difference between 7th and 20th is usually the manager.

 

Burnley managed to finish 7th simply by being able to defend. Swansea did well a few years ago because they could string a few passes together. It's why it is a complete fucking waste of time for clubs like Everton and West Ham spending huge sums. They can't sustain it sufficiently to actually get a seat at the top table. Better off getting a decent manager, building something slightly more organically, and accepting you're not finishing higher than 7th.

 

It makes their complete disregard for the domestic cups and the UEFA cup all the more ridiculous.

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38 minutes ago, TheHowieLama said:

1.9 billz to make 600 million over 10 years? That is a shite investment.

 

And it isn't risk free -- in fact that level of buyer may see the whole house of cards that is football finances come tumbling down.

 

Nothing is risk free. You are not running the risk of developing a mid-table club into a club of LFC's stature and failing, because presumably, LFC will be one in ten years even if you don't invest anything. What is shite investing depends on the structure and level at which you operate plus other value you can derive from it. Also, from what I've read, Hemry's mutual fund would be happy with that level of return over the last couple of years, because, if I am not mistaken,  it has in fact lost investors money.

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I think you may be mistaken -- in FSG,  no one has lost any money - they might have decided to put more in and of course have yet to see a principal return as they haven't sold the asset.

 

You can almost double your money over 10 years with even the most conservative portfolio (mid single digits).

You hit the nail on the head -- anyone who is buying a club at those levels gets some different value out of them.

In fact -- FSG may be last guys through the door in that they will build an acceptable cash return on their investment both annually and at time of sale.

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FSG has not lost money, Henry's fund went into liquidation because it wasn't making money, it was losing it short term, but I may be mistaken. If you play with 10k of unexpected inheritance, you will not buy German bonds, if you are running Norways sovereign pension fund, you will, it depends on a role what a particular investment has in your structure. Owners of City and Chelsea I don't think will end up making any money. If you are a Chinese investment group in need of a foothold, respectability, connections, or a petro prince, being and owner of one of the most famous clubs in the world for ten years AND making your money back with a nice little profit is not a shite investment. If you are chancing high returns, than you buy Bournemouth or Portsmouth for a couple of million turn them around and sell them. However, higher you climb (in the football league) it gets more difficult to make spectacular money. For FSG, we were an opportunity which does not come round every year, and as you said, it can still collapse as a house of cards and they may be happy to sell at what they have invested.

 

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  • 1 month later...

FSG Critics Pierced

This should be fun.

The 'FSG Out' Brigade have fallen silent - Jurgen Klopp's Liverpool is the culmination of owners' work

In this week's Blood Red column, James Pearce looks at the work FSG have done to help put Jurgen Klopp's Reds in position for the title

2_GettyImages-686364778.jpg
FSG and Jurgen Klopp
One particularly irate fan used to bombard the ECHO with one particular image from Brokeback Mountain. The faces of Jake Gyllenhaal and Heath Ledger had been replaced by John W Henry's and my own.

 

If you weren't advocating a change of ownership then you didn't want what was best for Liverpool apparently.

 

It was ridiculous and, predictably, in recent months the FSG Out Brigade have gone very quiet.

JS99087210.jpg
Liverpool manager Jurgen Klopp with FSG owner John Henry on the pitch at Anfiel 

In fact they must be in hibernation with the 'Liverpool are hamstrung without Zeljko Buvac crew' and the 'John Achterberg can't coach goalkeepers unit'.

 
With eight straight league wins and a six-point lead at the top of the Premier League table, it's difficult to find anything to moan about at Anfield right now.

 

Even Jordan Henderson's critics were put back in their box after his dominant performance against Newcastle on Boxing Day.

 

This hasn't happened by chance. Liverpool 's current place at the summit of English football isn't a freak occurrence.

 

For FSG, this is the result of years spent laying the foundations since they completed their £300million takeover of the Reds in October 2010.

 

“We’re here to win and we’ll do whatever is necessary,” said Henry when he first emerged from the London offices of law firm Slaughter & May as Liverpool's principal owner.

Jurgen Klopp with owners John W Henry and Linda Pizzuti Henry
Jurgen Klopp with owners John W Henry and Linda Pizzuti Henry 

A sense of impatience among the fanbase has been understandable at times over the past eight years. There have been false dawns and some agonising near misses.

 

Mistakes have been made along the way and FSG have had to change their approach. The transfer strategy has shifted from investing in potential to buying proven talent.

 

Many FSG dissenters will tell you that all they ever wanted was for Liverpool to spend big in the transfer market and that they have been proved right with the impact of signings like Virgil van Dijk, Alisson Becker, Naby Keita and Fabinho.

 

But that ignores the fact that to get to that position FSG had to put the Reds in a financial position where they could actually afford to compete for the biggest names. The club also needed an elite manager with the pulling power to attract the best.

Owner of the Boston Red Sox baseball team, and new owner of Liverpool Football Club, John W. Henry, gives the thumbs-up sign, as he leaves after addressing the media, after a meeting with lawyers, in central London on October 15, 2010.
Owner of the Boston Red Sox baseball team, and new owner of Liverpool Football Club, John W. Henry, gives the thumbs-up sign, as he leaves after addressing the media, after a meeting with lawyers, in central London on October 15, 2010.

It's not rocket science. The owners inherited an absolute mess and needed time to turn things around.

 

FSG made it clear from the off that Liverpool would have to live within its means and it would be a case of building up the club rather than simply throwing cash at it.

 

The Reds' total annual revenues virtually doubled from £184million in 2011 to £364million for the financial year to May 2017. Hefty losses have been turned into healthy profits.

 

When the next set of accounts come out in March the picture will be even brighter. The previous set of figures covered a season without European football.

 

Since then Liverpool have reached the Champions League final and cemented their place among Europe's elite by qualifying for the knockout stages once again.

 

They have also taken giant strides forward commercially with a host of new sponsorship deals across the globe.

 

Matchday revenues have been bolstered by Anfield's impressive new Main Stand – part of a £200million investment in the club's infrastructure which is continuing with the building of the new training ground at Kirkby.

But arguably their biggest achievement to date was appointing a world-class manager in Jurgen Klopp, who has proved to be the perfect fit and has galvanised the dressing room and the fanbase alike.

 

FSG have backed him to the hilt and delivered Klopp's top targets. They have put in place a structure that works with Klopp valuing the input of two shrewd operators in sporting director Michael Edwards and FSG president Mike Gordon.

 

Liverpool have bought well and sold even better. When you consider the quality of the squad now to the one Klopp inherited, it's remarkable that his net spend is only £126million.

 

The table-topping Reds boast the third youngest starting XI in the Premier League and have all their key personnel on long-term contracts.

 

No wonder FSG recently dismissed talk about them preparing to sell Liverpool for £1.5billion as “unfounded speculation”.

 

Yes, buying the Reds has been a fantastic investment for them. But if they were only concerned with making a quick buck they would have cashed in their chips long ago.

 

Glory was always the target and everything is now in place to achieve exactly that.

 

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