SOS - No to Refinancing - IMPORTANT

[FranStan]

looks like the letters are working !!!!!! Keep it up.

 

Liverpool Echo.co.uk - News - Liverpool Local News - MPs bid to topple Liverpool FC owners Tom Hicks and George Gillett

[Wannabe Scouse]

Nice one, Fran. Too bad we'll probably have to put our faith into the hands of politicians, but at least something seems to be happening.

[Lucky Pierre]

Just had this Email back from RBS:

Thank you for your email expressing concern about RBS' banking arrangements with Liverpool FC and it current owners. We are aware of the strength of feeling of a number of fans on this matter and have corresponded with many during the course of the past year or so.

Perhaps I can start by putting RBS relationship with Liverpool FC in context. RBS is the main banker to the Club including all of its operating accounts, cash management, online banking, automated payments, and credit card processing to facilitate ticket sales and retail merchandising. We also provide a credit facility to support the Club’s working capital requirements and a letter of credit facility to facilitate the purchase of players from non-Premiership Clubs, along with a loan facility for design, planning and other preparatory work for the proposed new stadium at Stanley Park. We have set out to establish a long term relationship with the Club, and we look forward to this continuing for many years to come.

We also lent money to the Club’s parent, Kop Football Limited, so that it could repay debt which was on the balance sheet of the Club at the time of its acquisition by George Gillett and Tom Hicks. This is the only portion of Kop Football’s bank debt for which the Club is legally responsible. We took great care when making our original loan in early 2007 and when refinancing it last January to distinguish between obligations of the Club, primarily those outlined above, and obligations of its parent company, the latter being secured by personal guarantees and collateral from the owners and a pledge of the shares they own in the Club. As a result the Club does not suffer the burden of debt implied by a lot of the recent press reports and, in our view and that of the executive management of the Club, it is financially healthy and able to service comfortably its debt obligations from cash flow generated by its playing and commercial activities. It is in our commercial interest to support the Club in the manner described above so that it can continue to perform successfully on and off the pitch.

As far as the Government is concerned, they have been very clear that they do not wish to exercise day to day control over RBS or make commercial decisions for us. Indeed they set up an independent body, UKFI, to oversee the Government’s shareholding in RBS, so matters such as strategy and governance can be agreed, while they leave commercially related matters to us.

RBS attaches a great deal of value to being associated with Liverpool FC. I hope my comments reassures you as to the strength and depth of our relationship with the Club and that we will endeavour to contribute to its long term health and success.

Kind Regards,

 

 

 

Roger Lowry

Head of Group Public Affairs

Royal Bank of Scotland Group

[Red Nick]

are fucking cunts that is all

[Lucky Pierre]

Just had exactly the same thing. I put it in the SOS-no to refinancing thread and forwarded it to SOS.

 

Roughly translated into everyday language, it means:

"This is too big a business oppurtunity to pass up. Kindly fuck off."

[Red Nick]

Thank you for your email expressing concern about RBS' banking arrangements with Liverpool FC and it current owners. We are aware of the strength of feeling of a number of fans on this matter and have corresponded with many during the course of the past year or so.

 

Perhaps I can start by putting RBS relationship with Liverpool FC in context. RBS is the main banker to the Club including all of its operating accounts, cash management, online banking, automated payments, and credit card processing to facilitate ticket sales and retail merchandising. We also provide a credit facility to support the Club’s working capital requirements and a letter of credit facility to facilitate the purchase of players from non-Premiership Clubs, along with a loan facility for design, planning and other preparatory work for the proposed new stadium at Stanley Park. We have set out to establish a long term relationship with the Club, and we look forward to this continuing for many years to come.

 

We also lent money to the Club’s parent, Kop Football Limited, so that it could repay debt which was on the balance sheet of the Club at the time of its acquisition by George Gillett and Tom Hicks. This is the only portion of Kop Football’s bank debt for which the Club is legally responsible. We took great care when making our original loan in early 2007 and when refinancing it last January to distinguish between obligations of the Club, primarily those outlined above, and obligations of its parent company, the latter being secured by personal guarantees and collateral from the owners and a pledge of the shares they own in the Club. As a result the Club does not suffer the burden of debt implied by a lot of the recent press reports and, in our view and that of the executive management of the Club, it is financially healthy and able to service comfortably its debt obligations from cash flow generated by its playing and commercial activities. It is in our commercial interest to support the Club in the manner described above so that it can continue to perform successfully on and off the pitch.

 

As far as the Government is concerned, they have been very clear that they do not wish to exercise day to day control over RBS or make commercial decisions for us. Indeed they set up an independent body, UKFI, to oversee the Government’s shareholding in RBS, so matters such as strategy and governance can be agreed, while they leave commercially related matters to us.

 

RBS attaches a great deal of value to being associated with Liverpool FC. I hope my comments reassures you as to the strength and depth of our relationship with the Club and that we will endeavour to contribute to its long term health and success.

 

Kind Regards,

 

 

 

 

Roger Lowry

Head of Group Public Affairs

Royal Bank of Scotland Group

 

280 Bishopsgate

London

EC2M 4RB

 

 

Sorry can someone delete the other thread please

[Guest Ronin47]

got one myself

[SpiritOfShankly]

Just going to get a truck to drive through that email.

 

Shot full of holes and discrepancies.

 

At least we may be able to open a dialogue with them now and continue to press our concerns.

 

Obviously individuals may wish to respond but the Union will also be putting together a response that we'll share in due course.

[Catch22]

Just going to get a truck to drive through that email.

 

Shot full of holes and discrepancies.

 

At least we may be able to open a dialogue with them now and continue to press our concerns.

 

Obviously individuals may wish to respond but the Union will also be putting together a response that we'll share in due course.

 

If RBS were to pull out, then the Yanks will simply get the loan from an instituition which doesn't care about publicity in the UK.

(There is no longer a systemic liquidity issue)

 

As there are less of these institutions around than the total including those who care about UK publicity, there is less competition & hence the cost to Lfc will be higher.

 

An analogy would be with personal borrowing.

The cheapest method is collaterized against a house. If this is ruled out, then normal bank overdrafts are more expensive.

If this is ruled out,then credit cards are available.

If all these methods are unavailable then a loan shark has to be used

 

Lfc can afford interest payments on the present debt thanks to the Sky deals.

 

The Yanks are always going to be able to refinance

 

At least with RBS, UK publicity means that we can engage them in conversation, which would not be the case if the cash came from an annoymous Caymen Islands fund.

 

Removing RBS gets us no further in our ultimate aim of removing the Yanks & will end up costing the club even more cash.

 

I do not expect SoS to normally care about the boring functioning of the world money markets but this policy has not been thought thru properly.

[ToxtethTerror]

The higher cost of borrowing will mean the investment is less attractive to the Yanks, catch22 especially given the sums involved.

[Catch22]

The higher cost of borrowing will mean the investment is less attractive to the Yanks, catch22 especially given the sums involved.

 

 

Yes that is correct for new investment.

 

However the debt already exists. It is not a new investment.

 

As long as interest payments don't exceed our operating profit (which they won't) it is in the Yanks' interest to keep re-financing

 

The main beneficiary of this is the debt holders to whom we are paying the interest.

[Dan Vito Corleone]

And who, Catch 22, will be this mystical white knight the Yanks can get their money off?

[reder]

The higher cost of borrowing will mean the investment is less attractive to the Yanks, catch22 especially given the sums involved.

 

And what, that is going to make them sell up and leave? It wont, it will make them stick in there for the long haul until things come good and someone is willing to stump up big bucks for the club. People seem to have forgotten that the club is still a potentially wonderful, mutli-million pound profit making machine.

 

Judging by the RBS response, they have no intention of rejecting any refinancing business from LFC. Looking at the level of custom they are getting as of now, it would be an awful business decision. They are obviously fully commited to a long term and very lucrative relationship with the club.

[Catch22]

And who, Catch 22, will be this mystical white knight the Yanks can get their money off?

 

Not a white knight

 

But a rational investor.

 

Lending to us at 10%+ is a great deal for the lender (& a shit deal for Lfc which is the point)

 

 

Have a look at similar corporate debt if you are so inclined.

 

We have the fanbase & the Sky TV money.

[aws]

Not a white knight

 

But a rational investor.

 

Lending to us at 10%+ is a great deal for the lender (& a shit deal for Lfc which is the point)

 

 

Have a look at similar corporate debt if you are so inclined.

 

We have the fanbase & the Sky TV money.

 

And a few players who could be sold to repay a huge chunk of the debt if needs must.

[Red Nick]

wankers

[diego]

While I agree that supporters should be sceptical or the owners and keep them under close and effective observation, I don't agree that they should try to stop them re-financing their loans.

 

The owners made a series of bad mistakes when they tried to undermine Rafa. Thanks largely to activist supporters they realised their mistake and corrected it. We now have one of the finest managers in the world signed up for five years with sufficient managerial autonomy to do the job.

 

The owners also made a mistake by trying to run the club through their sons. They have corrected that - thanks again to effective oversight and criticism from supporters.

 

They have also charged their lavish personal expenses to the club - expenses exaggerated by the fact that they live in the USA, travel by private jets and each hires his own team of expensive consultants and advisors for everything from checking the accounts, seeking financing, selling equity and developing plans for the stadium. As onerous as all this is it is better than their original bad plan to run the club through their sons, and some of those expenses may yet pay off if they do, in fact, attract equity investors.

 

The core of the problem is the debt they have created for the club and their failure to build the stadium.

 

It is in the owners best interest to build the stadium. In fact, if they don't they will never sell their investment at a substantial profit and may face a net loss. I believe that they want to build a stadium and will try to do it as soon as possible. It is not easy to find a construction loan of that magnitude in the present climate.

 

The other debts are more problematic. However, it is clear that the banks are forcing the owners to prove more personal guarantee against their personal borrowings, and the owners are responding by selling USA and Canadian assets. The debts on the club are worrying because for as long as there is no new stadium, the debts will increase and may become unserviceable. The owners know this and are seeking to reduce the debts by finding equity investors either through private offerings or possibly by going public.

 

A lot of supporter opposition is based on distaste that they are Americans and that they are leveraged buy-out specialists using borrowed money to acquire assets which they may then strip if they get into personal financial difficulties.

 

This type of ownership is not quintessential American. It was the British who introduced and perfected and took to extremes leverage buy outs and asset stripping. It would be very difficult to find a British owner who would not also use these techniques.

 

Of course leverage buy-outs introduce a large element of risk. But they also allow things to happen that would not have happened without borrowing. Its perfectly possible that if G&H play their cards right, they will be able to build a first-class stadium through borrowing and increase the value of their investment while at the same time providing sufficient managerial stability to the footballing and commercial aspects of the club to enable it to win trophies.

Edited June 26, 2009 by diego

[SpiritOfShankly]

The Spirit of Shankly have recognised the response received by members from the RBS following the recent letter and email campaign. Additionally there is further news relating to a Mass Meeting that has been called and the PTS issue – please see

 

Mass Meeting-RBS-PTS – Spirit Of Shankly – Liverpool Supporters' Union

[Dirk]

You might be better off putting that in a thread of it's own because people often get bored reading long threads, as they often become repetitive, so many don't bother opening them after they have been going for a while. Especially as it publicises a meeting.

[SpiritOfShankly]

The Spirit of Shankly have responded to the Royal Bank of Scotland's recent email and requested a meeting to discuss the future ownership of Liverpool Football Club.

 

This issue will be discussed in more detail (with more information about action that is proposed, and hopefully further progress) at the Mass Meeting at Zeligs called for 11th July 2009 at 1.00pm

 

The response can be seen at:

 

RBS - Spirit of Shankly Response – Spirit Of Shankly – Liverpool Supporters' Union

[ToxtethTerror]

It was all good until the "hand over the club to the fans line" or something similar.

 

*shudders*

[SpiritOfShankly]

Spirit of Shankly have received credible reports today that US Bank Wachovia are seriously considering not refinancing the loans due to the Club and its holding companies.

 

While this does not mean that they will refuse to refinance in the next week or so it does show that despite RBS’s response to our members that they as a UK based bank are prepared to offer continued assistance a US bank is far from convinced.

[coop]

Spirit of Shankly have received credible reports today that US Bank Wachovia are seriously considering not refinancing the loans due to the Club and its holding companies.

 

While this does not mean that they will refuse to refinance in the next week or so it does show that despite RBS’s response to our members that they as a UK based bank are prepared to offer continued assistance a US bank is far from convinced.

 

Surprised no-one else has posted regards this.

 

If Wachovia do no refinance their part of the loan it makes it a little more complicated.

[Barrington Womble]

Surprised no-one else has posted regards this.

 

If Wachovia do no refinance their part of the loan it makes it a little more complicated.

 

 

I think the trouble is nobody actually knows what it means. Who's to say RBS have not just lined up someone else to replace Wachovia? Who's to say RBS won't do it alone? Or finally maybe even take the club off the cunts? We would have no real idea at all. I can't wait until 24th when hopefully we have a little more clarity and we can focus on what needs to be done next.

[Antynwa]

Interesting stuff, I await future developments with future arguments over SOS.