Another day and another angle on the interest from DIC in getting hold of a chunk of the most successful club in English football history. After briefing the Echo off the record earlier in the week that they were about to make an offer to buy out Tom Hicks and become joint owners with George Gillett, DIC now seem to have been briefing the BBC. And today’s story claims they’ll be making an offer to buy out both owners, in a deal worth £500m
Hicks and Gillett have seen their plans for the Reds come close to failure in the midst of a messed-up financial world. A year ago they took out a loan, secured in their own names, which enabled them to pay off all the shareholders at a rate of £5000 per share, to pay off the club’s debts and to have a little left over to work with.
They paid £174.1 for those shares, and paid debt of £44.8m off, a total of just under £219m.
However they borrowed £298m from RBS.
The price of buying the £174.1m of shares was claimed in their offer document as actually costing them £185m, the extra money being classed as “associated costs”.
The remaining £113m borrowed was referred to as a “revolving credit facility”. This was to include paying off the £44.8m worth of debts. The remaining £68m of this “revolving credit facility” was supposedly aimed at funding the club and paying for preliminary work on the new stadium.
It would be interesting to see a breakdown of how that £68m was actually spent. At the time of the takeover it was expected that most of that would go into getting the building work underway on the new stadium. That didn’t happen – Hicks decided he wanted to get some other plans done; plans which left the fans in disbelief, so impressive were they. Actually they were too impressive. They hadn’t been costed up in any detail, according to Hicks, and when they did get a building price they realised they’d overdone it. However much it cost for those aborted plans to be drawn up and presented to the council, it was wasted money. And the owners have just had another two sets drawn up with a lower budget in mind. They are supposed to make their decision just about now on which set to go for, but there’s little sign of that happening.
So, the £68m spent, on what we don’t know, the owners now find that 12-month loan has nearly run out. So they need to get a new loan.
Reports vary slightly about why they are now looking for a £350m loan to pay off the year-old £298m loan. It’s claimed that the £350m will also pay off extra finance used to buy players in the summer, and to pay off the interest from the last year. If so we are talking of the club spending a massive £120m in a year, on top of the multi-millions that came in from prize money, TV money and other sources of income. Where did that money go? We didn’t buy a net £120m worth of players, we’ve not got half a stadium built.
Today the BBC website, along with BBC Radio Five Live and even Match of the Day have all made it clear that DIC are about to make an offer to buy the American duo out. When the Beeb say “The BBC understands…” ahead of some story, it means they’ve been given the information by somebody involved in the story, somebody who can’t be quoted on that for various reasons.
The BBC’s report said: “Dubai International Capital – the investment arm of the Dubai Government – is to launch a £500m bid to buy Liverpool Football Club. BBC Sport understands the offer is in the process of being made to American co-owners George Gillett and Tom Hicks.”
So either someone from DIC has briefed the BBC, or someone at the club who knows for a fact that this offer is about to be made has tipped the BBC off. So the offer is real, but that doesn’t mean it will be accepted.
The £500m would represent a phenomenal increase on what DIC would have paid last year had their own bid been accepted. They perhaps regret not jumping in with an increased offer a year ago, although they were said to be most angry at the way Moores and Parry handled their bid and that of the US pair. After hearing of the interest from Hicks and Gillett, DIC had put a deadline on their offer and Liverpool refused to meet it. The bid was withdrawn and Hicks and Gillett took over.
The BBC say DIC will make the offer “swiftly” to give the despised Hicks and his partner Gillett an opportunity to get out before committing the club to a loan it probably won’t be able to afford. With Parry and Moores reportedly against the loan, there are no certainties it will even be given to the club. Despite repeated claims from Hicks that he did not want to sell his shares in the club, this offer may prove too tempting for a man on the verge of some quite sustained opposition to his ownership of the club.
Supporters had in many cases been unwilling to believe the stories coming from Anfield claiming Hicks had made plans to fire manager Rafa Benitez. They’d refused to accept the surely outrageous stories that Jurgen Klinsmann, without experience at club level and hardly a favourite of Liverpool fans, had been lined up as the new manager. Hicks had already denied wanting to fire Rafa, saying it was something the press had made up. Then on Monday he admitted that he had indeed planned to fire Rafa, and had interviewed and offered the job to Klinsmann. He added that he would have sacked Rafa if we had gone out of the Champions League, or if the league form continued in the way it was (unbeaten but with a couple too many draws). Fans now realised that although it can’t be blamed for all the dropped points so far this season, Hicks’ – and Gillett’s – constant undermining of the manager had probably ensured Liverpool couldn’t challenge for the title this season. Certainly the defeat at Reading saw Rafa make earlier substitutions of key players than you’d ever normally see when behind in a league match, but with his job hanging on one result a few days later it was no wonder.
Hicks in particular is now despised by Liverpool fans. There really is no way back for the Texan as far as supporters are concerned. Perhaps if he’d made his admission on Monday and accompanied it with a heartfelt apology and some self-criticism of how wrong he’d been he’d have been given a slim chance. But he comes across as far too arrogant to admit mistakes, instead trying to justify his decision with reasons that don’t stand up to scrutiny. He lied. Liverpool fans don’t like being lied to; we’ve suffered from lies before and won’t suffer from them again. Hicks will never be welcome at Anfield again.
Gillett is hardly off the hook himself. Although he has kept quiet in recent months he was there at the Klinsmann interview, and has certainly not stopped Hicks from his amateurish actions. He’ll still find it difficult to earn any respect or trust from Liverpool fans, but the door isn’t completely closed. It’s clear the pair haven’t seen eye-to-eye since Athens, but Gillett seems to have been unwilling to stand up to the Texan.
Although not universally loved by all Liverpool fans, more often than not due to statements made in their name but not by them, the Reclaim The Kop group are going to lead the protests against the owners in Monday night’s league match with Aston Villa at Anfield. Differences between RTK and other fans are pretty minor, and all will be buried on Monday for the greater good. Liverpool fans will show their solidarity against the owners.
The message is simple. Tom Hicks: get out of our club, out of our director’s box, out of our lives. And Monday’s protests will be but the start of what will be a long and concerted effort against Hicks, and Gillett for that matter if he continues to allow Hicks to ride roughshod over our club and its traditions.
If DIC make that offer, Hicks will have to decide if he’d rather take the quick and, frankly, immoral profit on offer for selling up now, or if he wants to hang on and try and squeeze more out over a much longer term. The pair will need to decide if the aggravation they’ll face by staying on is worth it. Gillett is now 69, and will be getting on quite a bit before he’ll see a return on his money if he lets this offer slip past now.
Liverpool fans just have to wait. It’s MLK Day in the States on Monday, a national holiday, and a good opportunity for Hicks and Gillett to meet and discuss their options. Millions of Liverpool fans the world over will be hoping that they choose to jump into the DIC escape pod and finally leave our club alone.
Common yanks! accept it! So we will be happy…
YANKS OUT NOW!! DIC ALL THE WAY!! C’MON SAMEER U KNOW IT MAKES SENSE!
has a liverpool fan, i think their days are numbered, to treat benitez like that is not liverpool way,if you dont go now, you yanks will regret it,come on dic.
A nicely articulated piece that brings together the various threads of these issues well, cheers.
I was always a bit unsure of how the yanks bought the club in the first place. Whilst having no real idea of how these things work, it was surprising that DIC spent weeks looking over the books in their due diligence period, (if that’s the right way to put it?), whereas Gillet and Hicks had a quick squiz over the figures then signed up! It turns out that this cowboy approach to such a major business deal was in fact ill-conceived and they seem to have got themselves into a bit of a pickle.
I sincerely hope the Arabs do succeed in their takeover as I think they’d bring much more honour to the table than the Americans (no surprise there then). I think winning would be as much, if not more, of a necessity to them as the business side of things!
I do not see how things can recover and progress as they are. Gillet always appeared more affable then Hicks, but obviously would not be able manage (financially) on his own. So hopefully DIC will come in and restore the pride to our club, giving Rafa the tools and freedom he needs to do his job.
YNWA.
This is the fault of the board as they accepted an offer that made them more money rather than an offer which was good for the club.
DIC wanted to remove Parry as well.
The Yanks sweet talked them into a frankly dodgy deal and not only should the yanks go but so shoudl Moores for this fiasco so he could get more money per share.
Lets hope DIC step in and get rid of the razorblade gang which is cutting money out of the club.
quick quick, leave. Go home yankies, or go somewhere else. We don’t want to see your faces
It has just been reported £350 m will be offered and H & G to agree to the conditions of the offer…………..This is on BBC news 24.
GO G & H take the cash and F*&$ OFF
I stumbled across this site a few months back and have read the articles with great interest since. The way the clubs dirty linen has been hung out in public recently has been the most hurtful thing to witness over the past two months with regards to LFC. The results have not been great, but mostly draws rather than defeats, and hopefully with the right investment in the summer in terms of attacking quality and width in the midfield, LFC will make a more sustained challenge next season However, since Rafa’s now infamous press conference it’s been bad news after bad news off the pitch. I was willing to give the American owners a chance but since the Klinsmann affair I hope they see the damage is done and that they’ve lost the confidence of the fans as well as the clubs manager.
My concern is the DIC will prove to be no better. I know that on the whole they buy into the ‘Marquee’ brands around the world and no doubt LFC is with its history and potential. I doubt DIC will also publicly comment on matters such as the Klinsmann affair which should be kept quiet. However, before Hicks & Gillett came in with their bid I recall stories of certain documents being circulated by DIC showing there intention to sell the club after 10 yr period for a profit without making a massive investment in the club? I’m not meaning to piss on the bonfire or anything like that, just wondering if anybody can (hopefully) advise that this was some form misreport. Like most, I hope DIC provide the right kind of leadership for the club should they take over.
I’m a Chinese living in a Muslim country. Muslims are generally honorable ppl and they keep their words.
I’ve been a LFC fan for 25 years and believe me that the rich Muslims are ethical but crude ppl. They don’t spend much more than they should.
So we are looking at 2 scenarios. They wanted to buy LFC but lost, they are ^&*(*& angry about it, so this is an opportunity they won’t let go. On the other hand, being crude, I’m not sure they’ll pay 500mil, 300mil more than they would have got it for.
Between face and money, I think they choose face as honor is more important.
GO DIC, I’M WITH YOU ALL THE WAY.
Another fine article Jim.
I hope that at least one of the Gillet or Hicks clans (who we were promised would be regulars at Anfield) reads this site. I hope they understand that the fans resentment of their actions is not some media spin for a story. It is real. It is irreversible.
The purchase of a footbal club in the UK is unlike any other business. Even different from sports franchises in the US. Your are buying into 100s of 1000s of peoples dreams, aspirations and memories. Any mistakes you make (and there have been many now) go far beyond the disatisfaction of your creditors. Tom Hicks in particular must understand that he has lost all credibility and must bow out gracefully (lol).
Pjlfc: You are right about the concerns about DIC’s motives. Mihir Bose (now head of BBC sport) wrote this piece for the Telegraph at the time:
http://www.telegraph.co.uk/sport/main.jhtml?xml=/sport/2006/12/27/sfnliv27.xml
YNWA
Whatever happens, it looks like Moores and Parry displayed a level of naievity that beggars belief at the time the club was sold to the new owners. As I recall, DIC wanted more time to complete due diligence – not unreasonable you would think for such a large acquisition. The board refused to afford that time to them and the Americans got in cheap.. very cheap, considering what DIC appear to be willing to pay now. Surely they would have paid a similar amount last Summer?
Moores and Parry have to leave. They risked the entire viability of the club for “a bird in the hand”, when they owed it to the club and its traditions to check out the other “birds in the bush”.
It will be interesting to see who sits on the new board if the club is sold again. Assuming it’s DIC there will be a number of CIC representatives lokking after their interest. Presumably there will be a marketing and Financial director and a new Chief Executive. No doubt there will be a couple of non-execs as well. Liverpool’s bigest asset is its tradition and support base and a Director who totally understands that should sit on the board to ensure that the club ethos is maintained. I have no idea who that should be, perhaps a past player like Brian Hall, Ian StJohn, Steve Heighway, Phil Neal or Phil Thompson?
hit them where it hurts and boycott liverpool. do not turn up to their matches and do not buy any merchandise. That will get rid of the bloody yanks.
I’m From Mauritius, a small island in the Indian Ocean. We liverpool fans here, hope and pray that those idiotic american fools leave our club. Let DIC takeover, and yanks go back to where you came from. In England Football is Football! Not Soccer!
Americans Are Killing Our Club
It was not so long ago that we all thought we’d got our own billionaires to take this great club forwards – how wrong we were!
It started well, with the purchases of Torres and Babel, our best start to the season on the pitch, and plans for a world-class stadium fitting of Liverpool Football Club. Yet we are now finding ourselves more embarrassed by our new owners than I can ever remember. We have:
· The false promises – they were meant to be buying the club with a short-term loan to be paid back pretty quickly from the sale of another business, but that has not materialised
· Poorly thought-through plans – having raised our expectations with a world-class stadium design, a couple of months on they suddenly realised they couldn’t afford it after all
· A lack of patience – with the season only 3 months old, they were already going behind the manager’s back in an attempt to replace him. And this is a manager who has taken us to two European finals in three years!
· A lack of togetherness – even if they don’t believe this manager is the man for the job, they have to back him 100% in public until they fire him and get someone else in. I’m not saying we would have won the league this year, but announcing that they had spoken to Klinsmann makes it doubly difficult to turn things around because the manager’s and players’ minds are not 100% on the job of winning matches
· Appalling judgement – it is beyond me how anyone could believe that replacing a manager who has won La Liga twice, the Champions League and the UEFA Cup with someone who has never managed a club was anything other than an enormous gamble.
· No clear evidence of delivery – we heard how they were going to make more of the club commercially, but has anyone seen any evidence of that? I understand that anyone who is still with the Official Liverpool Supporters Club this season got an initial DVD, a pen and a pencil for their £30. That kind of value for money will not drive anyone to be loyal to the club.
· Blatant lies – how can they continue to claim they are not looking to sell when a City bank has been putting together a sales memorandum for at least a part of the club?
Now I have seen a lot of talk from Mr Hicks recently, and rather less from Mr Gillett, so maybe this reflects on one rather than both of them. Perhaps Mr Hicks should just take his own advice and “Quit talking”!!
The following link is to an article by Irish journalist Dion Fanning which appears in today’s Sunday Insependent. It’s the best I’ve seen so far.
http://www.independent.ie/sport/other-sports/rafa-revolts-1269774.html
we wont have to put DIC on our shirt will we???
thants the onky negatitvity i can find…