Baron Bascombe in the NOTW

[bobhorse]

DCI anyone just a thought

[coop]

DCI anyone just a thought

 

DIC i presume you meant. Not sure we would have been any better under them as although the main owner has loads of cash they were inviting investors from all over the place to jump on aboard plus it seemed they had a 6-7 year plan to sell us on.

[Rashid]

That's always what I assumed.

 

Are we being lumbered with the debt for the purchase of the club or the debt for the stadium. If it's the purchase of the club then I can see where people have a problem and it would go against the 'the club has no debt' quote. If it's the stadium then I always assumed that was going to be the case and you'll be hardpressed to find an investor who wouldn't go that down that route.

 

But if they are borrowing close on £500M I'd say it was on the purchase and the stadium. Now they are in with their initial outlay they can refinance that money how they like. I have no problems with the debt so long as it doesn't make us weak financially when competing with other clubs.

[Rashid]

DIC i presume you meant. Not sure we would have been any better under them as although the main owner has loads of cash they were inviting investors from all over the place to jump on aboard plus it seemed they had a 6-7 year plan to sell us on.

 

Hicks and Gillette combined are worth £750M according to the BBC, DIC is wholly owned by one of the richest men in the world and its main man is Sameer Ansari a Liverpool fan. The big difference for me is that if push came to shove DIC would not be scared of big money and large sums. DIC could also bail the club out if we got into trouble but I think Hicks and Gillette offer us better intelligence in the sporting sense.

[Cardie]

Hicks and Gillette combined are worth £750M according to the BBC, DIC is wholly owned by one of the richest men in the world and its main man is Sameer Ansari a Liverpool fan. The big difference for me is that if push came to shove DIC would not be scared of big money and large sums. DIC could also bail the club out if we got into trouble but I think Hicks and Gillette offer us better intelligence in the sporting sense.

 

Sameer Ansari is to DIC what Rick Parry is to us isn't he?

[bobhorse]

DIC i presume you meant. Not sure we would have been any better under them as although the main owner has loads of cash they were inviting investors from all over the place to jump on aboard plus it seemed they had a 6-7 year plan to sell us on.

 

Yes but in order to sell us on they would have to ensure we where debt free?

i think they would have sold the football club on and kept the ownership of the stadium just a guess

[coop]

I dont think there was anything during the proposed DIC take over which suggested that DIC was going to plough cash into Liverpool in fact far from it it was going to be run purely on a business sense and sold on in a few years when due to rising TV cash etc and a larger stadium we would be worth more cash for them to sell on.

 

DIC were openly courting other investors to join with them in Liverpool.

 

I am not denying that the owner of DIC is not wealthy but his love is horse racing and we were just purely a way of making extra cash and raising the profile of Dubai. The fact that the guy who runs DIC is a Liverpool fan is academic because he is first and foremost a business man and that was the main idea behind the take over not his love for Liverpool.

[Rashid]

Sameer Ansari is to DIC what Rick Parry is to us isn't he?

 

Not really. Ansari is the Co-Founder of DIC and a very respected man in the Middle East.

 

Sameer al-Ansari: Liverpool he lost, but could there be a Dubai connection in the bidding for Northern Rock?

 

Published: 04 November 2007

 

Sameer al-Ansari, founder and chairman of Dubai International Capital, chooses his words carefully. Asked whether his fledgling company could be a backer for a possible bid by Sir Richard Branson for the Northern Rock bank, he smiles and says: "You know the answer to that. There's no answer. All I can say is that we're currently looking at two deals – one here, the other in Germany."

 

His relentless good humour – in victory or defeat – is attractive. A dedicated Liverpool fan, he laughs as he recalls the rejection of DIC's £157m offer for Liverpool football club last year. "It took me two weeks to get over that, but it didn't dent my passion, I still went to every match when I was here."

 

The defeat seems a minor one when contrasted with the successful bids DIC has made for three UK companies over the past three years. Through a series of secondary buyouts from private equity firms, it first acquired the Tussauds Group for £800m, then Doncasters (manufacturers of precision engineered components and systems) for £700m, and more recently the Travelodge hotel chain for £675m. In June it also acquired Mauser, the German industrial packaging company, for €850m (£590m).

 

The company has been active in the public equities arena too, acquiring a 2 per cent stake in DaimlerChrysler for $1bn in 1995, and this year taking a substantial stake in HSBC Holdings. And despite the current whipsawing in global markets, Al-Ansari has ambitious targets for the next three years. "We aim to more than treble the value of assets under management from $7bn [£3.4bn] to just under $25bn," he says. "Our primary growth will come from a mix of private equity deals and investments in listed stocks, alongside the development of our businesses in the Middle East and North Africa."

 

He also expects that the opening of European offices in London last month will bring more investment opportunities in Europe and the US.

 

DIC is no ordinary investor. Founded in 2004, it is a wholly owned subsidiary of Dubai Holdings (the private company owned by Sheikh Mohammed bin Rashid al-Maktoum, the ruler of Dubai). It is sometimes, and disparagingly in Al-Ansari's view, referred to as a "sovereign wealth fund". Disparaging, because as Al-Ansari emphasises, the Sheikh's commercial businesses are run according to Western standards of corporate governance.

 

"We formed DIC as a vehicle for deploying the excess cash-flow from Dubai Holdings in international investments. Up to that point, our investments were Dubai-centric, in property and infrastructure," he says. "The quickest way for us to join the private equity club was to invest in big funds like Carlyle and KKR, on the basis we would partner in deals." The strategy seems to be paying off.

 

Neatly categorising DIC, Al-Ansari agrees, is difficult. Not that he is complaining; he sees it as an advantage. With captive funding from Dubai Holdings, DIC "can act more flexibly than other private equity firms," Al-Ansari points out. "We're not under the same time pressure to invest and exit and therefore can take better advantage of market conditions."

 

He also acknowledges the value and power of relationships in sourcing and selecting deals: "Our key criterion in selecting opportunities is not necessarily sector or geography but the capability of the management team to deliver a return on the investment. His Highness is a shrewd and well-connected businessman and this has undoubtedly helped us in identifying opportunities." Which, he quickly adds, are subjected to rigorous commercial examination in the due diligence process.

 

Now 44, Al-Ansari was born in Kuwait and came to England at the age of 13 to complete his schooling. With a degree in financial management from Loughborough University, he started his career at the accountancy firm BDO, later moving to Ernst & Young, which gave him a posting in Dubai in 1987.

 

He rapidly found himself working with government clients and was engaged as chief financial officer at Dubai Aluminium Company as part of a turnaround team. "At the time, the company was generating around 10 per cent of Dubai's GDP (the same as oil). It was important to get it back on track," he says. Eight years on, keen to flex his entrepreneurial skills, he set up a corporate finance firm, which he ran for two years before joining the Sheikh's executive office as chief financial officer. Together with the Sheikh's senior advisers, he developed the blueprint for Dubai Holdings, founded in 2004. Nine months later, in October, DIC was formed.

 

Today the company employs around 60 people. Its board has an impressive line-up of non-executives. They include Sir Peter Bonfield, the former chief executive of BT, and Victor Chu, the executive chairman of the Chinese investment firm First Eastern Investment Group, who emerged last month as a potential partner to Richard Branson in his mooted Northern Rock bid.

 

But with ambitious growth targets come risks. And with so- called sovereign wealth funds said to have around $2.8 trillion at their disposal, how does Al-Ansari respond to reports that President George Bush is under pressure to rein in the activities of foreign investors? Does he anticipate problems in the US?

 

"As economies become more stressed, protectionists might come to the fore," he replies. "[but] my personal view is that it's a two-way street. Funds need to flow in both directions in a globalised economy. If corporate America wants to grow globally, you can't prevent foreign direct investment from coming in."

 

And what impact has the recent credit crunch had on DIC's ability to finance leveraged buy-outs? "Well, the market undoubtedly slowed or rather came to a halt in July, but we've had no problem with our banks, nor do we anticipate one. I think we'll start to see more realistic valuations as a result, potentially reducing debt requirements."

 

With Mr Chu among its non-executive directors, DIC certainly has the right contacts to be involved in a bid for Northern Rock. But there are several other bidders for the bank too. Will Dubai add a renamed Rock to its growing asset portfolio? Only time will tell.

 

[Rashid]

I dont think there was anything during the proposed DIC take over which suggested that DIC was going to plough cash into Liverpool in fact far from it it was going to be run purely on a business sense and sold on in a few years when due to rising TV cash etc and a larger stadium we would be worth more cash for them to sell on.

 

DIC were openly courting other investors to join with them in Liverpool.

 

I am not denying that the owner of DIC is not wealthy but his love is horse racing and we were just purely a way of making extra cash and raising the profile of Dubai. The fact that the guy who runs DIC is a Liverpool fan is academic because he is first and foremost a business man and that was the main idea behind the take over not his love for Liverpool.

 

He has been in horses for 30 odd years and spent more than Abramovich on it, he has not made a penny.

[bobhorse]

I dont think there was anything during the proposed DIC take over which suggested that DIC was going to plough cash into Liverpool in fact far from it it was going to be run purely on a business sense and sold on in a few years when due to rising TV cash etc and a larger stadium we would be worth more cash for them to sell on.

 

DIC were openly courting other investors to join with them in Liverpool.

 

I am not denying that the owner of DIC is not wealthy but his love is horse racing and we were just purely a way of making extra cash and raising the profile of Dubai. The fact that the guy who runs DIC is a Liverpool fan is academic because he is first and foremost a business man and that was the main idea behind the take over not his love for Liverpool.

 

And the reason for anyone owning us was going to be something diffrent? we are a cash cow and still will be in a few years time we will be turning over 300m a year plus and growing the numbers look large but so did the 20m for Man Utd when the clown made his bid with cash he didnt have how good would that look now

[Cardie]

Not really. Ansari is the Co-Founder of DIC and a very respected man in the Middle East.

 

But he has very little power himself and can't agree a deal without the backing, and cash, of the big boss.

[Rashid]

But he has very little power himself and can't agree a deal without the backing, and cash, of the big boss.

 

You might be right Cardie... I read an article in a London Asian Newspaper that said that Ansari was happy to wait for Liverpool to come back to him but The Sheikh said he waits for noone and hence the plug was pulled. Ansari did say though that Liverpool would have competed with anyone in the world and the management at Anfield would "change"....

[TLW]

Gillette of the wads of cash waving?

 

That was what I thought too. I don't trust either of them personally.

[coop]

My point regards DIC is that the Sheik that owns them is not bothered about making cash on horses because thats his passion, same as Abramovich is with football.

 

I agree anyone who takes us over are in it for that cash, thats obvious but my point was that Gillett and Hicks were probably the lesser of the two evils we had available.

 

This is going over old ground anyways so we may as well end it now as we are just going to repeat what has been discussed on numerous occasions.

[Rashid]

My point regards DIC is that the Sheik that owns them is not bothered about making cash on horses because thats his passion, same as Abramovich is with football.

 

I agree anyone who takes us over are in it for that cash, thats obvious but my point was that Gillett and Hicks were probably the lesser of the two evils we had available.

 

This is going over old ground anyways so we may as well end it now as we are just going to repeat what has been discussed on numerous occasions.

 

We have got the two American's now so lets hope it goes OK for us. I preferred DIC as I know the Sheikh doesn't do anything by halves.

[King Emlyn]

For what it's worth i think DIC would have been the better choice of the two suitors. That said, given that it was Moores and Parry doing the choosing could it be any suprise if it turns out the wrong choice was made?

[Rashid]

I get the feeling Gillett's less hard-headed than Hicks.

 

Say either one could have bought us alone, I'd expect Gillett to be more likely to sanction a move for a big buy in the January window outside of any existing budgets. Hicks meanwhile would probably be more likely to refuse it, demanding sales first.

 

Which doesn't necessarily make Gillett the better option - he'd probably let us spend money we didn't actually have.

 

I do get the feeling that the two haven't been getting on since before the end of last season, certainly since Athens.

 

I see Gillette as all mouth and no trousers, and Hicks as the big mouth Texan who would buy just to prove a point. However I don't see either as passionate reds long term.

[George Costanza]

Neither one on their own could have afforded to buy us.

 

Unfortunately I get the feeling they've bitten off more than they can chew and now are struggling to get finance for the new stadium. The knock on effect will be less 'freedom' in the transfer market. Luckliy for the Americans and ourselves is that we already had/have a few valuable assets we can shift for decent money to give us reasonable buying power.

[Cardie]

Neither one on their own could have afforded to buy us.

 

Unfortunately I get the feeling they've bitten off more than they can chew and now are struggling to get finance for the new stadium. The knock on effect will be less 'freedom' in the transfer market. Luckliy for the Americans and ourselves is that we already had/have a few valuable assets we can shift for decent money to give us reasonable buying power.

 

It's more a case of the worldwide problem with credit at the moment than two crazy cowboys not entirely sure what they've bought into.

 

In terms of cost you'd be hard pressed to find sports that cost as much to run as NHL, NFL, NBA and MLB they all dwarf football for player contracts (a first year draft player in the NFL has recently been given a 60 million dollar contract, Michael Vick is on 16 million a year, 'A-rod' signed a contract worth more than our club).

[Rashid]

Point is Cardie, as Ansari says in that article - world wide credit problems have not caused DIC any problems,.

[ratcatcher]

Point is Cardie, as Ansari says in that article - world wide credit problems have not caused DIC any problems,.

 

Have DIC recently splashed out £400m with another £400m (or thereabouts) to spend on a new stadium?

[isr]

Have DIC recently splashed out £400m with another £400m (or thereabouts) to spend on a new stadium?

 

One of the things pointed out repeatedly during the takeover saga was that, while Hicks and Gillette do not have the pockets to ride out short term cash flow problems, DIC do.

 

Had DIC been the owners, they would have had the option of putting more of their money in, in the short term. Annual debt servicing would not have to get too far out of hand, as they *may* do now. DIC would have the option of putting their timetable for selling LFC back a few years.

 

True, at that time, no-one foresaw the worldwide "credit crunch" that was to come. Its not H+G's fault. But in reality, shit happens. And when shit happens, deep pockets buy you freedom of movement. Anyway, doesn't make any difference now.

 

FWIW, many of my initial reservations, especially about Gillette and his real intentions, have been allayed by their conduct this far. But, doesn't change the fact that DIC would have been the safer option.

[Cardie]

You say yourself "DIC would have the option of putting their timetable for selling LFC back a few years." how would putting the club in the hands of people who were looking to sell us after a set period be a safer option than trusting people with a history of owning sports teams?

 

Also with all the spare cash they have floating around why were they only looking to fund part of the purchase and looking for other investors to pick up the slack?

[Filo]

That's always what I assumed.

 

Are we being lumbered with the debt for the purchase of the club or the debt for the stadium. If it's the purchase of the club then I can see where people have a problem and it would go against the 'the club has no debt' quote. If it's the stadium then I always assumed that was going to be the case and you'll be hardpressed to find an investor who wouldn't go that down that route.

 

 

The talk for a while has been that the debt restructuring will see the debt used to finance buying the club moved into the club along with the raising the loans to finance the stadium.

 

Mind you its been said for a while that they'll want to take dividends from the club to pay for the interest on the loans to buy us in the first place so it won't make much difference unless we find ourselves in the position of not being able to finance the loan repayments in which case its the club's problem rather than their finance company

[isr]

You say yourself "DIC would have the option of putting their timetable for selling LFC back a few years." how would putting the club in the hands of people who were looking to sell us after a set period be a safer option than trusting people with a history of owning sports teams?

 

H+G will also be looking to sell LFC after funding the necessary stadium expansion, expanding off-the-field cash revenues and staying in long enough for future-expected huge TV cash increases. Their time frame might well have been longer than DIC, but I doubt they have planned to hold onto the club much beyond the medium term.

 

This has been argued about, ad infinitum, last year, but I don't think there's much issue with owners who are looking to eventually sell on. In today's world, really only the billionaire-fan or billionaire-in-search-of-a-new plaything can be expected to hold onto the club indefinitely.

 

Eventually, the Glazers, Lerners, Hicks and Gillettes of this league will be selling their clubs on.

 

Also with all the spare cash they have floating around why were they only looking to fund part of the purchase and looking for other investors to pick up the slack?

 

Again, argued to death in the past. Yes, DIC would have used debt to fund their purchase. Sound business sense. You only want to tie up your own cash reserves if you absolutely have to. They didn't have to, at that time.

 

The real difference between DIC and H+G is that only DIC have the option to use their VAST cash reserves to bail them out of short term sticky situations (such as unforeseen, non-LFC credit issues making debt more expensive than anticipated). As long as DIC remained convinced over the long term worth of their purchase.

 

H+G simply don't have that option. The only real difference between H+G, and the previous ownership is that the Americans have

1. greater sports managament competence

2. less averse to using debt to take the club onto the next stage (new stadium, etc)

 

When the club was sold, in reality - thats all we received in exchange.

 

Anyway, its done now, and perhaps there's not much to be gained by going over this again. I don't have any serious concerns over H+G's motives, just their room for manoeuvre.