The Financial Situation

[Moo]

That is as definitive as you will get - it's from Hicks and the advisor who is getting the loan - Tillis. That is what they are trying to do and that is why they can't seem to get the finance. Now by downsizing the stadium they are hoping the banks will refinance it all and include the pruchase amount. It is all so obvious.

 

Only until someone involved confirms it or it actually happens.

Until then I'll lay off the :wallbutt:

[drewy]

Thanks Rashid but nothing you have posted confirms, from the club, the banks concerned, or G&H themselves that the acquisition debt will be put on the club.

 

All you have posted is a previous example of a similar scenario and an article which suggests it could happen, in which the closest quote to suggest it is:

"We are also looking to put the acquisition debt on a more permanent footing. We are looking for the most innovative and flexible proposal."

 

I'm not ignoring that, in fact I've read it and taken it in several times before. But it's far from definitive.

 

Do you agree that all the evidence gathered so far points to this happening?

 

I'd say it's 95% nailed on, they simply have no other option and they certainly don't have the wedge to do it themselves.

[Moo]

Do you agree that all the evidence gathered so far points to this happening?

 

I'd say it's 95% nailed on, they simply have no other option and they certainly don't have the wedge to do it themselves.

 

No I don't think the actual evidence necessarily does.

 

However, the weight of opinion suggests it probably will happen.

There's too many people saying the same thing for it not to be taken very seriously, there's not often smoke without fire.

[Mascherano]

So, you buy something from someone else, borrow money to pay yourself back straight away against what you bought, then wait until stupid cunts like us pay off the debt of paying yourself back before you own it all without debt?

 

Can we club together and buy Everton?

[Red Nick]

Just seen Rafa's interview with ITV after the Chelsea game, not good at all.

 

More or less saying he's got no money to spend just that he was very happy with his team, didnt look happy

 

Think he's resigned to his fate

[Dropkick]

This does not look good at all - especially as far as transfers go. And before we get the usual bleating about newspaper rubbish, I'd say two things: the quality papers do care about journalistic integrity and the credibility of their stories; also, even if all of this is untrue, the fact that these stories are out there and not being denied is an issue in itself. With the way the media works now, even the perception of a problem, rather than an actual problem, can cause trouble. It creates uncertainty and affects confidence of both the players and potential lenders.

 

Liverpool face funding crisis

 

By David Bond, Chief Sports Reporter

 

The Telegraph 20/12/2007

 

 

Liverpool's American owners, Tom Hicks and George Gillett Jr, have postponed until 2009 plans to borrow £300 million from banks to pay for the club's new home at Stanley Park, plunging the project into fresh uncertainty.

 

Despite growing doubts among City sources last night, Hicks and Gillett are confident a separate plan to borrow £350m from the Royal Bank of Scotland and American bank Wachovia is still on track.

 

They intend to use the money to refinance the loans used to acquire the club in a £220 million takeover deal last February and to pay for the initial development costs of the stadium project.

 

In an echo of the way the Glazers financed their £800m takeover of Manchester United, a significant percentage of the new debt is to be covered by the club's income.

 

Although there are concerns among bankers over Gillett's ability to provide the personal guarantees required to secure the deal, the Americans have denied the interim financing is stalling and believe it could even be secured before Christmas.

 

However, the Daily Telegraph has learned that plans to raise the longer term funding required to complete the relocation from Anfield has been shelved until 2009 at the earliest.

 

The global credit crunch and nervousness over debt on Liverpool's balance sheet has forced Hicks and Gillett to abandon plans to raise all the money they need in one go.

 

Instead, they are now looking to borrow £350m to pay off a two-year loan with RBS worth around £270m, inject £60m of working capital for the ground and cover £25m of credit notes used to finance the summer purchases of Fernando Torres and Ryan Babel, again provided by RBS.

 

It is understood that while the £60m of stadium financing will get Hicks and Gillett through the first 18 months of work on the Stanley Park project there are serious concerns over how they will raise the remaining £300m needed to complete the stadium.

 

The Americans are confident of raising the money for the stadium once the project is under way, when it will be easier to secure contracts with future sponsors for naming rights and to predict income from the sale of seats and executive boxes.

 

But, contrary to promises made at their takeover earlier this year, the owners are now preparing to load at least half of the new £350m debt on to the club.

 

Banking sources said that while Hicks and Gillett had now agreed to pump in £20m of their own cash each to secure the new £350m loan, one of the main sticking points has been the American pair's reluctance or inability to put up their own money. In addition to the £40m in cash, the pair are also being asked to underwrite £75m in letters of credit and £60m in personal guarantees.

 

The refinancing of the club's debts means that from next season Liverpool will have to shoulder around £30m in annual interest repayments.

 

According to financial predictions for 2008, that will swallow up much of the club's spare cash, making it even harder to provide funds for manager Rafa Benitez to invest in his squad.

 

There are no quality papers and they only care about the appearance of integrity. We shouldnt be denying anything we should be ignoreing them they are just fishing for a story. It works like this. HEADLINE Liverpool in financial trouble. Next news cycle HEADLINE Parry denies Liverpool in financial trouble. See they got quotes and created a story out of NOTHING.

[RoboRiise]

So, you buy something from someone else, borrow money to pay yourself back straight away against what you bought, then wait until stupid cunts like us pay off the debt of paying yourself back before you own it all without debt?

 

Can we club together and buy Everton?

 

If any of our younger posters are considering GCSE Business Studies, Mascherano's saved you two years work there.

 

 

 

 

 

If someone gave me Everton for Christmas, I'd ask them if they kept the receipt.

[drewy]

There are no quality papers and they only care about the appearance of integrity. We shouldnt be denying anything we should be ignoreing them they are just fishing for a story. It works like this. HEADLINE Liverpool in financial trouble. Next news cycle HEADLINE Parry denies Liverpool in financial trouble. See they got quotes and created a story out of NOTHING.

 

You're in denial, are you seriously suggesting that we as a club don't have massive problems?

[Moschops II]

There are no quality papers and they only care about the appearance of integrity. We shouldnt be denying anything we should be ignoreing them they are just fishing for a story. It works like this. HEADLINE Liverpool in financial trouble. Next news cycle HEADLINE Parry denies Liverpool in financial trouble. See they got quotes and created a story out of NOTHING.

 

Where do you get your news from then?

[Anny Road]

So, you buy something from someone else, borrow money to pay yourself back straight away against what you bought, then wait until stupid cunts like us pay off the debt of paying yourself back before you own it all without debt?

 

Can we club together and buy Everton?

 

A more acurate description would be that you borrow money to buy something on the strength that you have lots of other things. If I dont pay it back you can have some of my other things.

 

I have paid for the thing you lent me the money for but guess what if you lend me some more I can build a new HQ and if it fails you can keep the original thing I bought which is worth far more than we paid for it and transfer the liabilty from my things to to thing I borrowed the money for.

 

BANK: Ok but give me 100mill just in case this goes pear shaped.

 

Cancel everything we said previously. We will get back to you.

[RoboRiise]

A more acurate description would be that you borrow money to buy something on the strength that you have lots of other things. If I dont pay it back you can have some of my other things.

 

I have paid for the thing you lent me the money for but guess what if you lend me some more I can build a new HQ and if it fails you can keep the original thing I bought which is worth far more than we paid for it and transfer the liabilty from my things to to thing I borrowed the money for.

 

BANK: Ok but give me 100mill just in case this goes pear shaped.

 

Cancel everything we said previously. We will get back to you.

 

And there's the 'A' Level.

 

 

If someone gave me Everton for Christmas, I'd ask them if they kept the receipt.

 

I wrote my new sig and I didn't even realise it at the time.

[Filo]

More in today's Telegraph

 

Liverpool owners face cash crisis

By David Bond, Chief Sports Reporter

Last Updated: 1:27am GMT 21/12/2007

 

 

Liverpool's owners, Tom Hicks and George Gillett Jr, have just over a month to refinance the loans they used to buy the club in a £220 million deal last February.

 

 

Although it was previously thought that the £270 million funding package arranged with the Royal Bank of Scotland was due to be repaid two years after they bought the club, The Daily Telegraph can confirm that the loan expires in February 2008, with an option to extend for a further 12 months.

 

 

That means the American businessmen are facing a race against time to finalise a new £350 million financial package with RBS and American investment bank Wachovia to pay off their original loans, inject £60 million into the new stadium project at Stanley Park and cover £25 million of credit notes used to buy players.

 

As revealed by yesterday's Telegraph, a plan to raise a further £300 million to complete the relocation from Anfield to a new 70,000-seater ground has been shelved until 2009 at the earliest. But of far greater concern to Hicks and Gillett is the need to reach an agreement with their bankers for the first phase of the refinancing.

 

Although RBS could take control of the club if the Americans defaulted on the loan in February, the extension option could give them some extra breathing space. But Hicks and Gillett are keen to conclude a new deal before the existing agreement expires.

 

City sources added that it was extremely unlikely that RBS would pull the plug on Liverpool, knowing the controversial move would be a public-relations disaster. And despite uncertainty surrounding the future funding of a new stadium, RBS know Liverpool remain a well-run business with an annual turnover in 2006 of £121 million. Qualifying for the group stages of the Champions League has also removed one added financial pressure.

 

Talks between RBS, Wachovia and the Americans' bankers, Inner Circle Sports, were continuing last night but while both sides remain hopeful of doing a deal, hopes are fading of clinching an agreement before the Christmas break.

 

Although a spokesman for Hicks and Gillett insisted yesterday that they were working towards announcing a deal in the next 24 hours, one banking source here said confirmation was unlikely to come before Christmas.

 

The hold-up is understood to have been caused by concerns over Gillett's ability to put up more than £87 million in cash and guarantees to underwrite the new bank financing.

 

Hicks and Gillett are being asked to pump in £20 million in cash each, along with £75 million in letters of credit and £60 million in personal guarantees. One solution could be for Hicks, the wealthier of the club's chairmen, to help cover Gillett's share of the guarantees.

 

According to City insiders, another major sticking point has been the owners' plans to load their £270 million acquisition debt on to the club's books. That is believed to have met fierce opposition from some members of the Liverpool board who don't want the club to be used to service the cost of the Hicks and Gillett takeover.

 

The attempt to load the acquisition debt on to the club's balance sheet is all the more controversial because Gillett and Hicks vowed not to follow the route taken by Manchester United owners, the Glazer family, when they took over last February.

 

Gillett said at the time: "We have purchased the club with no debt on the club so, in that regard, it is different [to the Glazers]."

 

An alternative structure is now being worked on which will result in more debt placed on to the club's parent company, Kop Football Ltd. But that has placed extra pressure on Hicks and Gillett to prove they have the money to guarantee the loans.

 

Liverpool chose to say nothing publicly about yesterday's Telegraph report, but a club source stressed plans for the new stadium would not be blown off course.

 

The Liverpool source added: "The stadium plans are still on track although, as was stated publicly earlier this week, the design may have to be scaled down in terms of extravagance. There is some tough talking going on between the Americans and the banks but the stadium plan is financially sound."

 

Liverpool announced earlier this week that the plans for the stadium, unveiled in July, were being scaled back after they came in £50 million over budget.

[Red22]

City sources added that it was extremely unlikely that RBS would pull the plug on Liverpool, knowing the controversial move would be a public-relations disaster.

 

No, it wouldn't.

 

According to City insiders, another major sticking point has been the owners' plans to load their £270 million acquisition debt on to the club's books. That is believed to have met fierce opposition from some members of the Liverpool board who don't want the club to be used to service the cost of the Hicks and Gillett takeover.

 

Dave, is there any possibility of getting in touch with the lads in charge of the other sites and trying to organise something? It needs some leadership from you guys and, judging by the reaction on the other sites, this might get a lot of backing.

 

I believe we're in a strong position at the moment and will be until this proposed re-financing deal goes through. Once they transfer the liability onto our balance sheet, we're fucked IMO.

 

Any strong, public protest or even the threat of boycott would make the lenders extremely nervous. In addition, I don't think Hicks in particular has the stomach for it and they could be forced to sell up.

 

What do you think? You seem to understand how bad this could get.

[Maldini]

According to City insiders, another major sticking point has been the owners' plans to load their £270 million acquisition debt on to the club's books. That is believed to have met fierce opposition from some members of the Liverpool board who don't want the club to be used to service the cost of the Hicks and Gillett takeover.

 

Err...the board consists of Gillett and Hicks, each of their sons, Parry and Moores. So where's the vociferous opposition coming from? It's not! The journo is making shit up

[Rashid]

So do we sit back and do nothing?

[redrosetints]

One who don't lie to start with, ones who don't draw up plans only to back track 6 months later, ones who don't appoint an inept CEO, ones who are a little bit more closer or have people hands on - and no play boy Foster doesn't count. Ones who aren't skint, and ones who actually know Mah United as Man United not Man Ham.... which is a cross between United and West Ham...

 

Football fans would be a start....

 

PS - I am not getting into this with you, I don't have the energy today.

 

PPS who the fuck are the Liverpool Red? Is that like Bootle Red Sox? :thumbsup: I doubt either of clowns know our postcode.

 

Oh come on Rash, I agree theres alot to be keeping an eye on, but this is just one eyed. DIC were floating 30% of us around the City with a seven year plan. Why is it you believe every last nasty rumour about the Yanks and not about DIC. Whoever we sold to would be looking to make money on us, FACT. Were a business and that wasn't Moores, Parry or G&Ts fault. We could have got Shinawatra, he'd have plouged cash in, but would you want that ?

 

And we got INter, cool

[Rashid]

Oh come on Rash, I agree theres alot to be keeping an eye on, but this is just one eyed. DIC were floating 30% of us around the City with a seven year plan. Why is it you believe every last nasty rumour about the Yanks and not about DIC. Whoever we sold to would be looking to make money on us, FACT. Were a business and that wasn't Moores, Parry or G&Ts fault. We could have got Shinawatra, he'd have plouged cash in, but would you want that ?

 

I am not going by rumours of the Yanks, the refinancing is out in the open with quotes from their financial advisors and themselves. The back tracking on the stadium is out in the open. The fight with Rafa is out in the open. The fact that they are skint and lied about falshing cash etc is out in the open. These are pricks.

[redrosetints]

I am not going by rumours of the Yanks, the refinancing is out in the open with quotes from their financial advisors and themselves. The back tracking on the stadium is out in the open. The fight with Rafa is out in the open. The fact that they are skint and lied about falshing cash etc is out in the open. These are pricks.

 

My point was that DIC lied about the fact they were trying to offload 30% of the club before they'd even purchased us. The document being put round the CIty was reported by the Telegraph, the same source that are now giving us all these quotes. So if DIC lied before NOT buying us, who is to say what they may have done further down the line.

 

Im saying that were here now, G&T own us, constantly harping at them is not going to change anything and simply give you a stress problem.

 

They've redone the Parry Bowl, we all cheered, but now its being slimmed back, we all boo. But if the reality is something like the Emirates, which is an improvement on the parry bowl, but not quite as good as first thought then whats wrong with that ? Yeah, it's poor to announce a plan and scuttle back, but the purpose of the new ground is to generate revenue, while funds put into the ground building will inevitably eat into the funds available to Rafa. Arsenal spent F all while the Emirates was built. So a cheaper stadium, that still increases capacity to 70,000 will give us less debt, create the same matchday revenue streams once built while keeping more money available for player recruitment.

 

In terms of transfers, we have long said it should be about quality over quantity. You can only have a squad so big, so its about adding to what you have. We spent 46m in the summer, broke out transfer record twice, that we recouped 20 odd m is surely more a reflection of the increase in quality of our squad, that those we can let go are of a far superior quality than those in previous summers, than an inditment on the Yanks. At the start of the season most felt that the capture of Heinze would have completed an excellent summer, and that didnt fall through because money wasnt available.

What we dont know, is if Eto or Villa had been available, would Rafa havebeenable to spend 30m+ to sign them ? BUt equally we dont know he wasn'tallowed that money.

[Trucker Paddy]

Oh come on Rash, I agree theres alot to be keeping an eye on, but this is just one eyed. DIC were floating 30% of us around the City with a seven year plan. Why is it you believe every last nasty rumour about the Yanks and not about DIC. Whoever we sold to would be looking to make money on us, FACT. l

 

This is'nt true DIC have denied they ever planned to sell the club and are taking legal action against that BBC journalist Bashe i think his name was for leaking a forgrd document and apparently this guy is a mate of Hicks.

[Rashid]

My point was that DIC lied about the fact they were trying to offload 30% of the club before they'd even purchased us. The document being put round the CIty was reported by the Telegraph, the same source that are now giving us all these quotes. So if DIC lied before NOT buying us, who is to say what they may have done further down the line.

 

Im saying that were here now, G&T own us, constantly harping at them is not going to change anything and simply give you a stress problem.

 

They've redone the Parry Bowl, we all cheered, but now its being slimmed back, we all boo. But if the reality is something like the Emirates, which is an improvement on the parry bowl, but not quite as good as first thought then whats wrong with that ? Yeah, it's poor to announce a plan and scuttle back, but the purpose of the new ground is to generate revenue, while funds put into the ground building will inevitably eat into the funds available to Rafa. Arsenal spent F all while the Emirates was built. So a cheaper stadium, that still increases capacity to 70,000 will give us less debt, create the same matchday revenue streams once built while keeping more money available for player recruitment.

 

In terms of transfers, we have long said it should be about quality over quantity. You can only have a squad so big, so its about adding to what you have. We spent 46m in the summer, broke out transfer record twice, that we recouped 20 odd m is surely more a reflection of the increase in quality of our squad, that those we can let go are of a far superior quality than those in previous summers, than an inditment on the Yanks. At the start of the season most felt that the capture of Heinze would have completed an excellent summer, and that didnt fall through because money wasnt available.

What we dont know, is if Eto or Villa had been available, would Rafa havebeenable to spend 30m+ to sign them ? BUt equally we dont know he wasn'tallowed that money.

 

DIC denied the document, the yanks openly admit to lying through their actions - massive difference.

 

It is not about the Parry Bowl or New Anfield, it's about doing something in the first place that was out of their depth.

 

Bury your head on the sand if you want., I refuse to.

[Rashid]

This is'nt true DIC have denied they ever planned to sell the club and are taking legal action against that BBC journalist Bashe i think his name was for leaking a forgrd document and apparently this guy is a mate of Hicks.

 

That legal action was threatened by Ansari - I didn't know it was going ahead.

[WeAreTheBest]

LONDON, Dec 21 (Reuters) - British soccer club Liverpool FC is expected to complete a debt refinancing before February after previous plans to complete in November were delayed by turmoil in the credit markets, sources close to the situation told Reuters.

The deal to refinance about 300 million pounds ($594.9 million) of debt, borrowed by U.S. billionaires Tom Hicks and George Gillett to acquire the club last year, is expected before a bridge facility with Royal Bank of Scotland expires in February.

"It will have to be before February," one of the sources said on Friday.

Wachovia Corp, the fourth-largest U.S. bank, is arranging the refinancing.

Hicks told Reuters on Oct. 25 that refinancing would be complete within 30 days. But credit markets slowed as banks' exposure to troubled U.S. sub-prime mortgages made them more risk-averse and expensive to borrow from.

Hicks, owner of the Texas Rangers baseball team, could not be reached for comment. Liverpool FC declined comment.

The refinancing deal will include an amount to start work on a new stadium, the sources said. This could be around 40 million pounds, one of the sources said.

Further financing for the new venue, expected to cost about 400 million pounds and to be ready by 2011, will be raised through a different deal, the source said.

[redrosetints]

DIC denied the document, the yanks openly admit to lying through their actions - massive difference.

 

It is not about the Parry Bowl or New Anfield, it's about doing something in the first place that was out of their depth.

 

Bury your head on the sand if you want., I refuse to.

 

So when the Telegraph report something about DIC, which DIC say is untrue you believe DIC. When the Telegraph report soemthing about the Yanks, which the Yanks say is untrue, you believe the Telegraph ?

 

The point, Rash, is not about having the head in the sand, its about not allowing personal opinion, that is based on rumour and gut feeling, to cloud a clear judgement.

 

There is clearly discontent at anfield and issues between different parties, but what is the truth ? Obviously someone at Anfield doesnt like the Yanks and is breifing away against them, but that doesnt necessarily make them right.

 

They have to deliver on the stadium, in the summer they delivered a good crop of players. So lets see what happens before we hang the Yanks, if for no other reason than were stuck with them.

[Rashid]

What that says is that the initial RBS has now been put on the club through Wachovia - with Hicks and LFC refusing to deny it or comment on it. WE now have £300M debt lads - enough to buy the club and get the work started.. more will be borrowed later.

[Rashid]

So when the Telegraph report something about DIC, which DIC say is untrue you believe DIC. When the Telegraph report soemthing about the Yanks, which the Yanks say is untrue, you believe the Telegraph ?

 

The point, Rash, is not about having the head in the sand, its about not allowing personal opinion, that is based on rumour and gut feeling, to cloud a clear judgement.

 

There is clearly discontent at anfield and issues between different parties, but what is the truth ? Obviously someone at Anfield doesnt like the Yanks and is breifing away against them, but that doesnt necessarily make them right.

 

They have to deliver on the stadium, in the summer they delivered a good crop of players. So lets see what happens before we hang the Yanks, if for no other reason than were stuck with them.

 

The yanks have not denied it if the yanks denied it then I would believe them too unless it was in my face that they lied. as has happened a few times. Hicks jas openly in that article and now in Forbes said that the original purchase will not be a loan on the club.

 

DIC are taking legal action against the document last I heard although I haven't seen it anywhere as it is difficult to prove who produced it. It could well have been the Americans for all we know.

 

Lastly, noone needs to brief against the Yanks, they are doing a great job on their own.