First round of bids for LFC

[RobbieOR]

I still think we're entering the end game here. There hasn't been a peep out of Hicks for ages which takes some doing, the whole club apparatus is geared towards the sale now IMO.

 

Me too. I think we'll be sold by September.

[Dirk]

Me too. I think we'll be sold by September.

 

You ought to have your bumps felt.

[Red Phoenix]

You ought to have your bumps felt.

 

Maybe I have a few more bumps then, am still thinking August.

[Kurt]

I still think we're entering the end game here. There hasn't been a peep out of Hicks for ages which takes some doing, the whole club apparatus is geared towards the sale now IMO.

 

Hope you are right...

 

 

Peep......Peep.....Peep......Peep

[Albertini]

The two things which don't add up are the 300m loan / "the backstop" which barclays agreed with H&G and the reasoning for the 120M equity injection being converted to a loan at the last minute. End game? Maybe. Just not the one we are being given the hard-sell on though.

 

There was always a degree of ambiguity in the Sunday Times article about this Barclays refinance offer.

 

The article spoke of Barclays coming in replacing RBS in order to facilitate a sale but then spoke of it being up to a new owner coming in deciding to refinance or not.

 

It seemed a bit woolly to me. Is the refinance for H&G or for a new owner? What were the conditions tied to it?

 

Either way it’s not happened though has it and there’s been no further talk of it since April.

 

That same article spoke of the owners having to reduce by July RBS debt by £100 million, be interesting to know if that is true.

 

You’d think if it was a goer then they’d have snapped Barclays hands off.

Perhaps Barclays have now seen what Hicks is doing in the US with his lenders and thought better of it.

[Dirk]

I'm no businessman but if I was and I was interested in buying Liverpool FC, I wouldn't buy the club now. I'd wait in the wings, so to speak, and allow it to get into grave financial trouble and pick it up for relative peanuts, rather than the price Hicks has mentioned. Put it this way, if you were interested in a house and you were aware it was close to being repossessed, would you pay the market value or allow it to be repossessed and pick it up cheaper?

[Antynwa]

I'm no businessman but if I was and I was interested in buying Liverpool FC, I wouldn't buy the club now. I'd wait in the wings, so to speak, and allow it to get into grave financial trouble and pick it up for relative peanuts, rather than the price Hicks has mentioned. Put it this way, if you were interested in a house and you were aware it was close to being repossessed, would you pay the market value or allow it to be repossessed and pick it up cheaper?

 

I've maintained that view for quite a long time.

[Moo]

I'm no businessman but if I was and I was interested in buying Liverpool FC, I wouldn't buy the club now. I'd wait in the wings, so to speak, and allow it to get into grave financial trouble and pick it up for relative peanuts, rather than the price Hicks has mentioned. Put it this way, if you were interested in a house and you were aware it was close to being repossessed, would you pay the market value or allow it to be repossessed and pick it up cheaper?

 

True.

But once it's reposessed your chances of buying that house decrease as more people are interested in buying at the reduced cost.

If a prospective buyer really wants us, they may have to consider paying the premium to secure the deal.

Having said that, for various other reasons, I still feel we won't be sold any time soo.

[Springer]

I'm no businessman but if I was and I was interested in buying Liverpool FC, I wouldn't buy the club now. I'd wait in the wings, so to speak, and allow it to get into grave financial trouble and pick it up for relative peanuts, rather than the price Hicks has mentioned. Put it this way, if you were interested in a house and you were aware it was close to being repossessed, would you pay the market value or allow it to be repossessed and pick it up cheaper?

 

If you had the money and you wanted that house really bad. And if you knew you had to get it now or you might never get the chance again..

[King Emlyn]

This place is an absolute gas at times.

[adidas samba]

If and i do mean a big if we sold nando as reported to chavs or city,masch to inter then as reports have it that makes £100 million.Just the amount the yanks need to stay at the helm.:wallbutt::wallbutt:

[stringvest]

I'm no businessman but if I was and I was interested in buying Liverpool FC, I wouldn't buy the club now. I'd wait in the wings, so to speak, and allow it to get into grave financial trouble and pick it up for relative peanuts, rather than the price Hicks has mentioned. Put it this way, if you were interested in a house and you were aware it was close to being repossessed, would you pay the market value or allow it to be repossessed and pick it up cheaper?

 

the purchase price may be cheaper but to get the club operating at anything like a sensible return would mean spending vast fortunes getting the team, which by that time would have fallen into serious disrepair, up to snuff again - as well as reversing declining attendances, recovering disappearing image and marketing revenue across the globe etc etc. It's not a 'normal' business in that sense - it's more of a brand. Every 6 months delay (or every transfer window if you like) without investment would see players leaving, the value of the asset plummeting, and the 'recovery time' lengthened by (at least) 18 months. Buying now, strange as it may seem, would be the most sensible option.

[Jim MM]

If and i do mean a big if we sold nando as reported to chavs or city,masch to inter then as reports have it that makes £100 million.Just the amount the yanks need to stay at the helm.:wallbutt::wallbutt:

 

Allegedly the deadline for the £100m passed in April and that deal is off the table. The new deal is they allow Broughton sell the club. Allegedly.

[stringvest]

There was always a degree of ambiguity in the Sunday Times article about this Barclays refinance offer.

 

The article spoke of Barclays coming in replacing RBS in order to facilitate a sale but then spoke of it being up to a new owner coming in deciding to refinance or not.

 

It seemed a bit woolly to me. Is the refinance for H&G or for a new owner? What were the conditions tied to it?

 

Either way it’s not happened though has it and there’s been no further talk of it since April.

 

That same article spoke of the owners having to reduce by July RBS debt by £100 million, be interesting to know if that is true.

 

You’d think if it was a goer then they’d have snapped Barclays hands off.

Perhaps Barclays have now seen what Hicks is doing in the US with his lenders and thought better of it.

 

BarCap will do fine out of any sale - and in addition they will make finance available to the new owners (if required).

[Guest Numero Veinticinco]

BarCap will do fine out of any sale - and in addition they will make finance available to the new owners (if required).

 

Yes, but only with a view to a sale.

[stringvest]

Yes, but only with a view to a sale.

 

Absolutely.

[TheHitman]

Interesting hypothesis that has been put forward found it on TTWAR.

 

I'm led to believe we've paid 85.3 mill in interest since Feb 2007.

 

During 08-09 financial year interest rate payments went up from 36.5 mill to 40.1 mill. That increase is due to further finance from Kop football (Cayman) limited - owned by Hicks and Gillett

 

Trading profit in that year was 27.1 mill, but clearly that doesn't cover 40.1 mill owed in interest. Estimates for profits for FY09-10 suggest 30-35 mill.

 

Net debt also shot up by 51.6mill during FY08-09 to atotal of 351.8 mill. Gross debt figure seems to be 378.6 mill - 234mill is owed to RBS and 144 mill is owed to Cayman Limited. interest on RBS loan is LIBOR plus 5 per cent, Cayman interest is 10% a year.

 

Accounts say this has not yet been paid - but this is simply added to the growing debt.

 

Caymon limited loan owed to Hicks and Gillett is repayable on demand, but cannot be progressed if it would cause the company to become insolvent.

 

110 mill of the total 297 mill credit facility with RBS is secured by letters of credit and personal gurantee from the owners, 187 mill is secured by the club's assets.

 

These bank loans are extremely short term in nature and keep having to be renegotiated - refinanced. Some reports suggest 250 mill repayment is due September 2010, others suggest that they have managed to push this back to March 2011.

 

During 2009 RBS got H+G to pay back 60 mill in return for a 12 month extension. RBS insisted that Barclays capital were brought in to find a buyer. That was one of their conditions, and here is the rub I suspect, - and this is conjecture - in the negotiations was also to make Purslow de facto CEO. Puslow's principal business background - he was a founder and he's still a partner in mid Ocean finance. Private equity firm that involved the manager's of Deutsche Bank's private equity arm setting up themselves - a spinout - it's called (Purlsow was MD of DB capital partners). It was worth about 1.3 bill - one of the biggest private equity deals in history.

 

In 2009 they branched out and formed Mid Ocean credit partners and invested in bank loans. What seems to be a mid ocean trait is to pilot their people into the companies they invest in to secure their investments and revenue streams. So the theory goes Mid Ocean invested in and provided credit for RBS bank loans, including the credit facilities to Liverpool. This means that the principal creditor to the owners is now running the shop and protecting his initial investments, managing LFC finances to ensure that the loans continue to be serviced in a fashion that most suits the creditors. Quite a profitable little business. That means trimming the squad and expanding revenues, so as to value skim by stealth. It doesn't seem to mean outright drastic, panic driven asset stripping. To protect the total value of the club is in their interest, so the club will maintain a decent market value, while extracting the returns on their investment through debt re-servicing costs. In the meantime there doesn't seem to be much incentive for them (mid Ocean and Puslow) to rush to find a buyer - LFC is a nice earner. Meanwhile, as a one day a week chairman Broughton, who is supposedly in charge of the sale seems little more than a figurehead constitutional monarch.

 

I don't know what to think anymore, but all of that does sound plausible to me.