The full details of the Share Liverpool FC proposals that – if brought to fruition – would see LFC bought out by fans are due to be revealed this evening.
On their website they claim that this is far from being just a pipe dream: “It’s no pipe dream; it’s do-able. Liverpool Football Club has millions of fans across the world. Most of them will have been worrying about what has been happening to our Club lately. And they’ll be realising that life as a Liverpool fan could get much more expensive.”
“We propose a model of ownership similar to that at Barcelona. This club is owned by their ‘members’. Over 100,000 fans have bought single ‘member’ shares, which entitle them to elect a Board who will run the club until the next election. At Barcelona it is once every four years. That way, no one can ever buy the club. Its structure makes its sale to the next sporting conglomerate that fancies a premiership football club a legal impossibility. The shares can never be sold; the club can never be sold. Let’s stop Liverpool Football Club becoming a trinket any rich man might like to wear around his neck. This club is close to the hearts of millions of people all over the world.”
A great and inspirational statement, but a big question is how much it will cost each potential member. It’s as predicted: “We estimate that a sum of £5,000 each will be enough. We need 100,000 members. 100,000 x £5,000 = £500 million. That should buy the club and go a long way towards building a new stadium.”
They also talk of how despite the current owners steering clear of major hikes to ticket prices it’s only a matter of time before the debt they’ve put the club into has to be paid somehow, and increases in ticket prices is one way. They also predict a controversial Manchester United scheme for cup tickets could be forced upon Reds fans: “We’ve seen what’s happened already to season ticket holders at Manchester United. You have to commit in advance to buy all home Cup games – without even knowing how many games that will be! Say ten in total on average. That’s an extra £400 – £500 to add to the price of your season ticket at Old Trafford.”
Another big question is how they see their chances of getting hold of 100,000 people who have a spare £5000 to spend on buying into the club. They’re banking on the way that somehow, ever since the earliest days of Liverpool’s European adventures, the fans have managed to find the means to go and watch faraway matches. They feel that Reds will do something similar to get a chunk of the club: “We took nearly 50,000 fans to Istanbul – Athens too. In reality, it cost most of us between £1,000 and £2,000 to make the trip; more if we took our partners and kids along. Liverpool fans have always turned out when the Club needed them. They find the money somehow, even at short notice. And remember, there are literally millions of us round the world who really care about LFC.”
Five grand is more than many fans can afford, every season more and more season ticket holders are finding it’s becoming a struggle to find that cash, but they still desperately want to be a part of this move to get the club back into the hands of people who love it. We’ve received comments to this site from supporters who wondered if they could team up with some mates and buy a share between them. According to Share LFC, that will be fine: “We don’t want to see any Liverpool fan excluded. We will seek to provide opportunities for groups of fans to purchase one ‘member share’ (carrying one vote) between them, providing they can nominate one individual to represent them.”
They are also planning to give the rush for a piece of the action a bit of a boost – there will be a deadline for applications, but also they plan to give perks to the first 20,000 respondents: “We will propose giving the first 20,000 people to respond special status and possibly enhanced advantages for ticket purchase. Those who commit first deserve some reward for their enthusiasm.”
According to the group, these schemes can work: “Barcelona and Real Madrid are owned by their fans. So are German clubs, apart from Bayer Leverkusen. In fact, teams owned by their fans like this have won the European Cup 6 times since it became the Champions League in 1992. Even in USA, the NFL Green Bay Packers are run by a not-for-profit company; they’ve won the Superbowl three times despite having by far the smallest population of any NFL team.”
The club’s debt, directly and indirectly, now stands at £350m and that’s before they take out the other loan they need to cover the bulk of the building costs for the new stadium, at least another £250m at current estimates. There was never any real issue over the idea of borrowing the costs of building the stadium, the big issue with the current owners’ borrowings are that it currently covers little more than what should have remained their personal borrowings for their purchase of the club. It looks like the new group would use the £500m to pay off the current owners, and then would borrow to top up the funds needed for the new stadium: “Look at Arsenal. They’ve no sugar-daddy. The club costed up its plans, secured loans and convinced people to lend to them at a fixed-rate. The Banks trust the club’s finances will be well-run and that fans will continue to watch the club. If we could show how much fans of this club care, and how they’re prepared to back their faith with hard cash, then everything changes. We don’t need a sugar daddy – we are the sugar daddy – because most of the money comes from us in the end anyway.”
The first issue to come to light under the new owners, although they tried hard to disguise the facts, was that they weren’t putting in the extra investment for new players that had been a material part of the acceptance of their bid. This fans takeover will at least reduce the debt on the club, but will it allow any extra funding for players during the wait for the new stadium? They say it will depend on the decisions of those elected to run the club: “If we have a well run, debt free Club to start with, there will be money to buy players. Also the elected Board may wish to raise money. At Barca, very rich individuals stand for election with promises of further investment. But it doesn’t mean they ‘own’ any part of Club.”
There’s always the possibility that the group will fail to attract that figure 100,000 fans with a spare £5,000, but if that happens they will consider the option – with approval of those who did sign up – of buying a partial stake in the club: “Let’s say we only get £100m – the equivalent of 20,000 fans signing up. At that point we would ask the 20,000 ‘members’ what they want to do. Some of us might want – as a group – to buy a significant portion of the club’s shares. Certainly, at that point, any individual member who wanted the money returned would be entitled to it.”
There’s also some clarification about whether the £5000 share will rise in value over time. It won’t. The plan is not quite the same as selling shares in a plc, for example, and there will be restrictions on selling the shares: “There will be no ordinary ‘trading’ in individual shares, no profit can be made from selling them, otherwise the Club would be permanently up for sale just like Manchester United was. However, if a member can find someone who does not already own a member share, then a transfer at the original price may be arranged through the elected Board.”
Money won’t need to be paid out straight away: “Nobody will be asked to part with a penny until a detailed Constitution is presented in which all necessary details are made plain.” And when payments do begin, they’ve plans on how to keep track of how much has been raised: “We will have a partner Bank where the monies will be kept until we reach the target. We will ask the two Bishops of Liverpool to act as verifiers for us – they’ll see the bank accounts, have access to all the books and be able to speak to the bank to certify that it’s all there. We will also ask the Liverpool City Council Treasurer to act as a scrutineer.”
Fans will get to vote on various elements that go towards the running of the club: “Members will elect the Board of Directors for Liverpool FC, for a term to be decided by them. After an Election, just like the Government, the Board will have executive control of the Club, but they may want an elected ‘Fans’ Council’ to advise them. The Board will know that – in a few years time – they will be judged on their performance by the owners – the members.” The members won’t be voting for who manages the club however.
They say this is a first: “Though there have been many formations of ‘Fan Supporters’ Trusts’ at professional clubs in the past decade, and three Football League Clubs are run by a majority shareholder Fans’ Supporters’ Trusts, Liverpool would be the pioneers in completing a ‘members’ buy-out. What we propose would probably start a revolution in Club ownership structures in the UK, but then Liverpool fans have often been at the vanguard of changing the culture of football.”
To keep costs down, they’re also pleading for any volunteers who are in a position to offer free professional advice: “We want this to be a genuine fans’ initiative and we know something about the costs of professional advice. Are you in a senior position in banking, accountancy, corporate finance etc? Please contact us if you think you could provide voluntary assistance to this project.”
The site also gives a brief background to those who are behind this idea: “Share Liverpool FC is a group of Liverpool fans, advised by some of the foremost experts in supporter and co-operative ownership in football.
“It includes, leading the initiative, Rogan Taylor, Kop season ticket holder and LFC fan for over forty years; founder member and Chair of the Football Supporters’ Association, launched in Liverpool after the Heysel Stadium Disaster in 1985. Rogan is currently the Director of the Football Industry Group at the University of Liverpool.
“Advising the group, Supporters Direct; the organisation that assists in the formation of supporters’ trusts, and assists them in gaining equity and democratic representation at their clubs. Kevin Jaquis, of the law firm, Cobbetts, the top UK firm for co-operative and mutual law which has played a leading role in the development of mutuals and co-operatives in housing, health and education. Kevin was part of the group which developed the Supporters Trust concept and wrote the model constitution which is now used by over 100 trusts in England, Wales and Scotland.”
Andy Burnham, an Everton supporter and now Secretary of State for Culture, Media & Sport is keen to see this idea work: “The Barcelona model,” he said, “to me, is how a football club should be run. They are one of the most pre-eminent names in world football, yet the club is owned by its supporters on a one-member, one-vote basis and they control it. That strengthens it because it’s never subject to the whim of one person; it’s a collective endeavour. English football should see that as a big strength. I’d love to see if we could grow the Barcelona model here.”