Rescuing Liverpool

Anfield, the director's box
By David Bick, Chairman, Square1 Consulting

Liverpool has potentially reached its most important historic point. The Club has now gone 20 years without winning the English League title. It has never won the Premier League. It was drummed out earlier than expected from this year’s Champions League and now, as one of the world’s biggest clubs, faces the ignominy and reality of failing to qualify for next season’s premier European competition. This is the barely believable backdrop to a club with a footballing history to die for and what Liverpool legend Alan Hansen describes as the best fans in the world.

Why has it come to this? What is to be done?

Anfield main standWe live in a litigious world, so it is difficult to call a spade a shovel. But, to my mind, the people running the club over the last two decades must bear the bulk of the responsibility and the brunt of the criticism. On a recent visit to Anfield to watch my team, West Ham, play like a pub team with a Force 10 hangover, one had only to look at the stadium to see the years of dreadful neglect at first hand. Unbelievably, there are still pillars holding up one roof!

Whether it comes down to incompetence or thoughtless arrogance at Liverpool, we have seen the club left behind by the other great clubs like Arsenal, Manchester United, Manchester City, Chelsea and Spurs. They have rebuilt their stadia to high standards and, largely speaking, to capacities that accommodate their substantial fan bases. Yet all Liverpool fans have heard is talk and a string of broken promises. The other clubs have built their revenue streams or attracted owners that have given them the wherewithal to compete effectively at the top of the modern game. It seems to me that the Liverpool fans are being treated to a ‘product’ that is rooted in the 1970s.

Sadly, in very recent times, Liverpool has also been owned by people who have said much and delivered little of the stated vision. Replacing them is a very urgent imperative.

Liverpool claimed in a recent statement that it has “…overseen a significant improvement in the financial performance of the club since 2007.” Well, that’s difficult to assess. The management has not published accounts for Kop Football (Holdings) Limited – the main trading company – since the filing for the year to 31 July 2008 and, in that year, the business showed net losses of over £42m and net interest payments on debt of £35m not covered at all (let alone adequately) by operating profit – pre-player amortisation and trading – of £25m. Debt remains stubbornly near a reported £240m, so what profits are produced do not leave much, if anything, for the manager to work with, even if we believe rumours of a £35m profit for the year that will end this 31 July. In short, Liverpool’s financial structure can’t work in my opinion and, since the sale of the club in 2007, it was never going to.

If the manager cannot operate competitively in the transfer market, he has no chance of competing regularly in the Top Four. We have now seen the first concrete sign of this with the failure to even stay in the Top Four. Manchester United, a club manfully trying to cope with a similarly onerous financial structure will also, I believe, start to experience similar problems, although their state of decline is nowhere near as advanced as Liverpool’s.

What about the role of RBS in all this? One of Liverpool’s principal lenders nearly brought the entire banking system down. Previously run by a man of monumental arrogance, this bank nearly had us all wiped out and in penury. The immediate collapse of our economy was only arrested in the nick of time just under two years ago. The bankers at RBS who are responsible for the debt exposure to Liverpool can’t be blamed for that. But they can be held to account for propping up a club regime that has signally failed to deliver new investment so far. They should think very carefully before renewing a facility to a corporate customer when other comparably struggling businesses find it almost impossible to raise working capital from banks at anything other than punitive rates of interest. RBS should be part of the solution, not part of the problem. Charging another fee – this time rumoured to be around £10m – won’t help the club for the sake of a six month extension to its banking facilities.

It seems axiomatic to me that Liverpool needs new, responsible owners and new top flight, football-experienced executive management.

It will not be beyond the wit of man, the new well regarded Chairman included, to find such a new owner. But first of all, Liverpool needs to stop spinning silly numbers. Rumours abound of a price being asked from £500m up to an incredible £800m, the lower of which is, in my view, way over the top for a club in its current condition and by any sensible comparison with Arsenal or Manchester United. Financially at least, Liverpool must have a new stadium if it is to have any hope of restoring past glories. But the finance for that, and any subsequent financial benefit to owners, must accrue to those who put up the money. In any case, this will not be a conventional acquisition of a football asset – it is more likely now to be a rescue.

The new owners will need to be people of high calibre. They will need to have access to very large sums of money to build the new stadium, revitalise the management and allow for a well thought through strengthening of the playing squad. They will need to have a vision and a clear understanding of what this great football club stands for. They will need to embrace and listen to the fans. Liverpool fans have a deep understanding of football and they have an unquenchable thirst for success based on a game played to its finest traditions. They are a real 12th man. The new owner will also ‘inherit’ a truly global fan base, so will have an immense platform to build on.

Right now, Liverpool is at risk of losing its manager and some of its best players, demoralised by a recent Europa Cup semi-final defeat and a poor season. While no-one is irreplaceable, such an exodus will leave a new owner with an even more difficult task. Therefore, the new Chairman of Liverpool needs to act with some swiftness. Once decline becomes precipitous, even money may not prevent the decline spiralling into permanency.

Published with full permission of the author.

Liverpool v Chelsea – Aquilani keeps place, Maxi starts

Could this be Rafa’s last home game as Liverpool manager? It certainly feels much less likely than it did on Friday, but Rafa is not happy with the way he’s been left without the support of the board – and not just financial support – for yet another season. And this has been Liverpool’s worse season since he arrived.

New chairman Martin Broughton still hadn’t met the manager when the manager was last interviewed, and through fear of cheering at the wrong time the BA boss won’t be meeting him at today’s game either.

The manager is unhappy. The senior management seem to flit between pretending everything’s fine with the manager, telling members of the press they think the manager’s playing games to see what more he can get out of the club, or that he’s going anyway – of his own accord.  Meanwhile we hear about senior management discussing transfers without his knowledge, and letting the press know all about it, in what Rafa seems to believe is an attempt to undermine him. And it wouldn’t be the first.

The club seem to think Rafa is in the middle of doing what Xabi Alonso did last year, when Xabi had his new club lined up and agreed well before the end of the season. But it does seem more likely that Rafa’s doing what Gerrard did in 2005 – looking for reassurance that he really is wanted, looking for a sign that the club hopes he rejects advances from elsewhere.

Have we learned nothing about communication? That applies to a number of people at the club, who need to start opening their mouths and talking to each other, instead of trying to guess and fearing the worst, like a lovesick teenager wondering if they’re being two-timed.

Meanwhile there’s a game to play today and it’s one that sees the manager pick a weak side. Not a weakened side, just a side that’s about us good as he can pick.

With Carragher, Agger and Kyrgiakos all starting it either means a three-man defence or that one of them is playing at full-back.  And it seems like it will be Agger, playing at left back, with Mascherano again dropping back into defence to play right-back. Glen Johnson, switched to left-back in midweek, isn’t in the 18 today.

Whether Carragher will lose his rag at his right-back this year as he did in the last home game of last season remains to be seen, but if there’s one thing Liverpool do want to play for this afternoon it’s a clean sheet to keep Pepe Reina on course for another golden gloves award. It was the risk of losing that last season that caused Jamie Carragher to lose it with Alvaro Arbeloa, in what turned out to be his last game for the club.

£17m signing Alberto Aquilani makes it two starts in a row this afternoon, but Ryan Babel is dropped to the bench to make way for Maxi Rodriquez.

Liverpool have now qualified for the Europa League for next season, but their chances of fourth place are so slim it really isn’t worth considering it as a possibility. City and Spurs would have to draw in their fixture on Wednesday, before going on to lose their games at Burnley and West Ham. So Europa League it is for Liverpool next season, and unless major steps are made to sort out the mess that remains at the club even that might be seen as a massive achievement before too long.

Liverpool: Reina, Mascherano, Agger, Carragher, Kyrgiakos, Lucas, Gerrard, Aquilani, Maxi, Benayoun, Kuyt.
Subs: Cavalieri, Babel, Pacheco, Ngog, El Zhar, Degen, Ayala.