diego

Sell sell sell, we'll never win the league with that twat as captain.

There's only one question - how much are they willing to pay?

Not a bitch and a moan; just a request for a reminder: when did we last have a consistently dangerous set piece taker? Our corners have been poo for years - there isn't a player in the squad who can whip a dangerous ball into the box. Free kicks - we've had a few good 'uns (Gerrard and JAR), but no-one consistently great for years. And finally penalities: both Gerrard and Owen have been variable. Who's the last "in the corners" penalty taker we had?

Billy Liddle was the last really effective corner taker from the left and right. They would come in fast and high and then kind of hang - usually right in the centre. And that was when the balls were made of tough leather with prominent laces and as heavy as lead when sodden with mud and water.

BANKING & FINANCE / COMMENT /

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The beautiful game doesn’t mean beautiful profits

by Andrew Neil on Sunday, 03 February 2008

 

When it comes to football, normal rules of business don't apply. You think with your heart, you do the sums with your feet and your make key decisions with your best pals over dinner.

 

So it is with huge surprise - and more than a little concern - that I see Dubai International Capital (DIC) is preparing another bid for Liverpool Football Club. By the time you read this column, the chances are DIC's US$500 million offer will have been accepted; one of the world's most famous clubs will be in Arab hands.

 

But I find this deal difficult to understand for several reasons. First, let's look at DIC's current investment strategy: it has major stakes in seven companies across the globe and in another seven private equity funds. According to its own website, DIC is "focused on acquisitions of market leading companies in Europe and North America, with a proven strategy and robust management".

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I could rest my case here: Liverpool FC is an iconic football team but "proven strategy and robust management" aren't words that quite go with it. The current owners paid US$340 million for the club last year; they took on US$87.7 million of debt; and soon agreed to the building of a new stadium. Now they have run out of cash and their total loans are approaching US$690 million. No wonder they need to get out in a hurry.

 

DIC can argue that Hicks and Gillett have made a mess of a fantastic brand and business; so stepping in makes perfect sense. They will point out that the boss of DIC, Sameer Al Ansari, is a lifelong Liverpool fan. This is what concerns me most.

 

Let's look at other "lifelong fans": Mike Ashley has pumped US$500 million into Newcastle Football Club, with no sign of any return in the next five years; Sir Alan Sugar eventually had to let go of his beloved Tottenham Football Club; Mohammed Al Fayed of Harrods fames is out US$700 million and counting at Fulham Football Club.

 

Football, whichever way you look at it, is not a business in which you will make money quickly. Which is why I fear Ansari and Co will come unstuck.

 

Their current investments abroad have all so far been admirable and with a clear profit return path. Take one of the most recent, a US$1.2 billion stake in Alliance Medical, a company which specializes in providing outsourced diagnostic imaging such as MRI scans.

 

DIC can open up the huge Middle East market. Nothing wrong with that - after all, that's what DIC exits for: to get into businesses, turn them around and get out.

 

But Gillett and Hicks got into Liverpool, realized they couldn't turn it around and got out in a hurry: the demands of 40,000 fans every weekend, the national media, the cries for new players and a new stadium, proved too much and too expensive.

 

Sameer Al Ansari is about to experience all this first hand. Football fans taking over football clubs have historically been marriages made in hell. Ansari is a smart man - if anyone can break the mould, he can. But I wouldn't hold your breath.

 

Andrew Neil is the former editor of The Sunday Times and chief executive of BSkyB. He is currently chief executive of Press Holdings Media, chairman of ITP, chairman of World Media Rights and a presenter of This Week (BBC1) Daily Politics (BBC2) Straight Talk (BBC News24).

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Don't know how reliable this Andrew Neil is.

He is not a business or economic analyst. He is a glorified reporter. His analysis is naive.

That said, the only arguments for DIC are (a) goodwill from ownership of an international vehicle to strengthen the "Dubai brand": (b) after a start-up period of 5-6 years which would have negative cash flow, a sustained period of substantial positive cash-flow and the prospect of very large captial gains if the decision were made to dispose of the club.

Sheikh to try again

BARCLAYS PREMIER LEAGUE Liverpool v Sunderland, today, Kick-off 5.15pm

By David Maddock 02/02/2008

 

Sheikh Mohammed is ready to test the partnership between the joint owners of Liverpool by making a formal offer for the club.

 

The billionaire's investment company DIC has been studying closely the terms of a restructuring deal at Anfield that Americans Tom Hicks and George Gillett announced last week.

 

And now the investment arm of the Dubai government is primed to approach the pair with a fresh offer that will value the club in the region of £300million.

 

DIC's hopes of buying the club they first bid for a year ago seem to rest on exploitation of the uneasy relationship between the two US tycoons.

 

Hicks has taken the lead in recent weeks by announcing a refinancing deal with the banks that secures his grip on the club - and he also unveiled £300million plans for a new state-of-the-art stadium.

 

Gillett, who has the option of selling his 50 per cent stake, has remained conspicuously silent during that fanfare - and his position is the key to success for the increasingly confident Sheikh.

 

Sheikh to try again - Mirror.co.uk

Maddock is a whore who just re-writes the Liverpool Daily Post stuff.

RR - There is no way ChrisB will alienate his mates Carra and Stevie.. the reason he is speculating in the article is because he doean't want it to sound like he has been fed the stories.

You don't know Bascombe so how come you are interpreting his motives?

Your agenda is to beat the drum against Rafa whichever way you can.

Bascombe has not been in touch with Carra or Steve. Whoever wrote that article, Bascombe or whoever, is just making it up like you are making up that you know Bascombe.

Irrespective of current problems, Steve G's has never gotten over Houllier's dismissal and Rafa's arrival. He made life very difficult for Rafa with his flirting with Chlesea. He turned Chelsea down because he could not stand the heat from Liverpool supporters - which is hardly the ideal basis for his still being at LFC. He has an exaggerated idea of his "special place" at LFC.

His head has been turned by H&G especially G and dreams of big American dollars. He has never supported Rafa and only began to admit the politics might be upsetting the team when he saw that the supporters were virtually 100% against the Yanks.

I don't think LFC will win the league as long as Stevie G is captain. I'd let him stay if he behaves and if he learns to adjust to the other talents on the team. Otherwise I'd get shut of him this summer, use the money to bring in enthusiastic players who will play for the club as the manager dictates, without moaning and without needing exaggerated wages and promises that one day he will be manager. We don't want another Shearer.

He's in no position to demand a price, this posturing is as close to hardball as he can play.

There was no need for Hicks to respond to the media reports today or ever. In fact he would have been better advised not to respond. Gillett has not responded nor DIC, nor Parry.

The fact that he has responded demonstrates that the reports have touched a nerve - that he feels they will weaken him in someway and quickly - with Gillett or with the bankers - or that they will strengthen DIC's bargaining hand with Gillett.

His response is almost meaningless. If he has not received an offer yet how does he know that he will not sell? If he has not already arranged new finance - and only three days ago he was saying on CNBC that it would be done last week - the last of several failed forecasts - then how does he know he will continue to be "co-owner"?

If DIC do not brush aside this prelimianry defence, then they are not up to the fight . They already made a costly blunder by letting Hicks and Gillet in when DIC failed to make an offer after a very lengthy period of due diligence. While DIC was trying to line up minority equity partners, and were acting as if they already owned the club, Gillett and Hicks moved in swiftly and bought it from under their nose.

NOTE The BBC did not say they had heard the "sick and tired" remark from the family member of one of the owners "last season" as some on here reported, but last November.

How many times will the DIC 7-year exit plan have to be explained? Its annoying to see it continually misrepresented.

It was not a statement of intent to exit. It was an investment analysis drawn up for potential investors showing them when they might expect a return large enough to justify an exit, if that is what they wanted.

The more interesting question is why DIC was looking for investors even before they had made an offer to Moores and the other shareholders. Some might see it as a negative. I see it as a positive. They would still have control by limiting other shareholders to 35%. They would reduce their own equity investment.

They would then be able to finance transfers as Moores used to do - by providing the club with loans. Everyone talks about Moores providing money from his own pocket. He didn't. He lent money and got back all his loans with interest when he sold out to H & G.

I do not accept Rashid's explanation that DIC denied the existence of a 7 year investment plan - they simply said it did not represent their intention to exit in 7 years.

And his statement that the plan was created by a rival consortium is just daft.

I don't believe that DIC would have informed anyone what price they were prepared to offer - even off the record. That is not the way this type of business is done and there is no advantage to DIC in so doing and considerable disadvantage. I also think the price of 500 is unrealistic..

I have just noticed that the BBC has changed their story. They now say DIC has prepared a bid of 350 NOT 500.

350 makes more sense to me although I still don't believe they have tipped off any journalists off the record. If the BBC has a source it may be someone who knows about the bid but is not part of DIC.

350 allows them to start negotiating. It might end up as a higher bid, though.

While I agree that Gillett wanted to stay long term and was prepared to go through a learning curve and to be hands-off, that scenario has been ruined by Hicks. Gillett can recover if he becomes a minority partner with DIC, but there are unknown risks in that for him. And, in the end, he is in it for the money, too. And in investment there is a saying that its never wrong to take a profit.

Gillett wanted to buy Villa and sussed out other teams before he made an offer for Liverpool. He might be better off taking his profit from DIC and making a play for another "soccer franchise" elsewhere.

I don't believe that DIC would have informed anyone what price they were prepared to offer - even off the record. That is not the way this type of business is done and there is no advantage to DIC in so doing and considerable disadvantage. I also think the price of 500 is unrealistic.

If they have decided to make an offer for 100%, at whatever price, it could be a good tactical move in order to get at least 50%. This approach does not depend on Gillett taking the initiative to offer to buy out Hicks with DIC financial backing. They both would need to consider the offer and do it together especially if the offer was for 100% and no less.

In that context Gillett and Hicks are free to negotiate with each other. I guess their agreement gives each one of them first option to buy the shares of the other - which means at least matching the price being offered by a third party. Neither of them can afford to do that. So this would mean that both would be free to try to get DIC to accept their 50%.

One of the original conditions of sale before was sold to H & G was that it would not be sold to a consortium. LFC wanted a single strong buyer.

The DIC investment analysis that was leaked to the press showed that they were looking for equity partners. That's the memorandum where they showed how an investor could exit with a profit in 7 years if they wished. So the idea of working with equity partners was always part of the DIC approach.

But LFC did not think their approach offended the no-consortium rule because DIC would have voting control.

Gillet was rebuffed the first time around because he was not financially strong enough. He brought in Hicks only as a make-weight. The fact that they were only two instead of a larger number also got around the no-consortium rule, although the fact that neither of them had voting control offended the rule.

If it is true that DIC will accept 50% then they are being consistent in being willing to work with equity partners (Gillett). But to be completely consistent with their original position and the no consortium principle, they need to gain voting control.

Gillett may give them the control in exchange for the deal. He could sell them 10% to add to the 50% they buy from Hicks. Right from the very beginning Gillett has expressed admiration for DIC. He really needs them now if he is not to see his investment in LFC and his personal reputation go down the drain as a result of Hicks. Its also possible he simply can't stump up enough equity to secure loans.

They could do it in other ways. They could buy 55% from Hicks and Gillett leaving them as minority partners. Or they could buy Hicks out and have a side deal with Gillett to restucutre a holding company to give them voting control. They could also have an option of first refusal should he ever want to sell, or an agreement to buy him out at an pre-agreed price in the future.