Stadium downgrade revealed, but no finance as yet

Despite hopes from many Liverpool supporters that DIC would step in and buy the club off current owners Tom Hicks and George Gillett, before they committed to a new loan which could quite easily cripple the club in the event of even just one poor season, the 25^th of January looks like being a black Friday in Liverpool’s history. Although in typical Hicks style, it might be a black Saturday or Monday instead.

Two announcements were expected to be made today by the owners. One was to confirm that they had increased Liverpool Football Club’s debt significantly; the other was to try and soften that devastating blow with details of the latest plans for the new stadium, which will become the third version submitted for planning permission.

It was expected that both news items would be revealed at the same time, but instead the first announcement to come was that on the new stadium.

Perhaps it’s easy to read too much into things, but although the announcement appeared on the Liverpool FC website, it was not worded as being an announcement from Liverpool FC, or for that matter Hicks and Gillett. When Hicks and Gillett took the club over last year, they actually used a holding company they’d created, Kop Football. They owned the holding company; the holding company owned the club.

George Gillett, unheard of since before Christmas, his son having seemingly fled the country two weeks ago, isn’t even mentioned in the announcement. Tom Hicks is quoted in the release, but only by name. It’s normal practice to describe the position of anyone quoted in a press release, be it director, owner, manager or custodian, but not in this instance.

Here’s the announcement:

HKS TO DESIGN NEW STADIUM

Paul Eaton 25 January 2008

Kop Football (Holdings) Limited, (“Kop”) the owner of Liverpool Football Club, is pleased to announce the confirmation of the selection of the architectural firm HKS, Inc. as designer of the Club’s new stadium at Stanley Park.

Confirmation of the selection of HKS was based on the firm’s successful development of an improved stadium design that meets the objective of a cost-effective, supporter-friendly design.

The new stadium, scheduled to open in August 2011, will ensure that Liverpool Football Club and its supporters get the much-anticipated groundbreaking iconic design at a capacity of approximately 71,000 seats, significantly more than is currently available at Anfield.

The new stadium will feature enhanced amenities for the Club’s supporters while preserving the history and traditions of Anfield and the Club itself.

It will be anchored by an expanded 18,500-seat standalone KOP, an increase of more than 5,000 seats.

Kop also announces the appointment of KUD International as project manager for the stadium. KUD, which will establish a Liverpool office to oversee the project, has developed projects globally, including Silvertown Quays, a large-scale mixed use scheme in London, as well as collegiate and professional stadiums in the United States including the Philadelphia Eagles’ Lincoln Financial Field and the San Francisco Giants’ AT&T Park.

Laing O’Rourke, the largest privately owned construction firm in the UK, has also joined, and provides further depth of experience to, the project team. Laing O’Rourke is currently working with developer Grosvenor on The Paradise Project in Liverpool – Europe’s largest city-centre regeneration scheme.

Tom Hicks said: “HKS has developed a more efficient design that, at the same time, is just as stunning as its original design.

“Liverpool supporters should have high expectations for the future: a premier sporting experience at their new stadium at Stanley Park and a winning Club on the pitch for years to come.”

Liverpool supporters’ expectations weren’t very high a year ago; but even those expectations were never met.

At first glance the images of what Rick Parry described as a “downgraded” set of plans do indeed seem to show a stadium that at least cosmetically looks very close to the earlier design. See for yourself here, including some side-by-side shots of the July 2007 version compared to January 2008. But can the club afford to build it?

Planning permission will need to be obtained for this latest variation on the plans, especially given the quoted increase in capacity. Hicks and Gillett will need to convince the city council that the area will be able to cope with such an increase in match day traffic, almost 50% more traffic than a home game would attract today.

Official details of the estimated cost weren’t revealed in this announcement, although figures as high as £300m were quoted this week from some sources, with the lowest figure quoted being £210m.

The refinancing deal due to be announced today will reportedly last for 18 months, and will be split between Liverpool FC, Kop Football Holdings and a small fraction on guarantees from Hicks and Gillett. The money released will pay off the £298m loan from last year, and should also allow a start to be made on the stadium, if it gets planning permission.

Opposition from supporters towards Hicks and Gillett has not decreased, and isn’t likely to with any of the announcements made today. There’s even a rumour going around that Hicks wants to show his commitment to Rafa by signing Javier Mascherano on a permanent deal.

Well we were supposed to get a new stadium – that was a condition of the takeover – so hardly anything to celebrate there, especially given the continuing uncertainty over its cost, how it will be funded, and if it will even be granted planning permission. As for Mascherano – well given the fact that the owners have yet to spend anything on transfers that couldn’t have been spent without their arrival on the scene, his signature should have been the minimum we could expect from them. His deal sounds expensive, £17m, but that was to be paid over five years. And as Hicks will no doubt realise, he’ll have no problems at all selling him on at a profit if he so chooses at a later date, which may become the Liverpool way in the future.

The BBC sports editor Mihir Bose says that £60m of the new finance package will be put into getting the stadium building underway, although with there only being £52m left over after the existing loan has been paid off it’s not too clear how that can be. He said: “Liverpool are very keen for the announcement of this package to be presented as a good news story from Anfield after weeks of strife.”

Bose has a mixed reputation when it comes to being in the know: sometimes he is, sometimes he isn’t. But he seems to report in the same way regardless. He said: “I’m told by my sources in Dubai that DIC is still very keen and has been selling assets to make sure it has the necessary money. It was not keen on this re-financing because it feels it puts up the price of Liverpool. But DIC is still in the wings, and I wouldn’t be surprised if something happens on that front, maybe not just now but in the next year or so.”

The Echo’s Tony Barrett reported today that although Hicks is confident the finance deal will go through, and that it’s only being held up by paperwork, “sources close to the deal” have said that George Gillett’s still not stumped up his share of the money, effectively a deposit, required by RBS and Wachovia before the deal can be done.

Of course at the time of the writing of this article, the US is just rising from its slumbers, which may not have been exactly peaceful for Hicks and Gillett. But it does mean that there is time for Hicks to make the announcement, no doubt to some kind of fanfare.

DIC aren’t seen by all fans as the answer to all the club’s problems, and a large number of fans would have preferred we’d not been sold at all, and perhaps tried to expand Anfield bit-by-bit instead. But most fans agree that DIC can’t be any worse than Hicks and Gillett, and many of those hope that DIC would at least be professional in their control of the club, and that they would understand that the customer, the supporter, is an asset the club needs to look after.

The LFC Supporters Network‘s recent surveys showed that the majority of supporters asked would be prepared to change their spending habits when it comes to the club, to reduce the money the club takes in from supporters, their votes showing overwhelmingly that they felt the club was in the wrong hands. Moving on from that the group encouraged discussions amongst fans using internet messaging boards. These discussions have already thrown up some excellent ideas which will hit the owners in the pocket, both here and overseas, and will also attract a lot of publicity to the cause. Any other ideas are most welcome of course, and will be discussed at a meeting next week organised by LFCSN. The meeting will be attended by existing supporters’ groups, by fanzine editors, by website owners and by others who are prepared to do what they can to see the club gets back on a path closer to where it should have been.

One of those who’ll be there is John Mackin from RTK, who said today that Hicks and Gillett have a pretty tough, if not impossible, task ahead of them if they want to gain the trust of the supporters again: “Unless the owners come out and say they are giving Rafa Benitez a new deal, they are going to support him extensively in the transfer market, and that none of the money to fund that will put the club in debt, they have got no chance of winning us over. Such is the level of disquiet among the fans that a meeting is to be held next week when we will discuss the next phase in our ongoing protests against the owners.”

As John says, building work should have commenced last spring and yet we are still waiting for even token activity on the project: “We have seen pretty pictures of stadium designs before and we’re still waiting for a single spade to go into the ground at Stanley Park, something Hicks and Gillett promised would happen within 60 days of takeover, so it’ll take a lot more than a new picture and a major PR offensive for us to be won over.”

Liverpool fans will not be lied to, as we’ve proved before. Gillett and Hicks have not kept their promises so far, and so nobody who wears a Red scarf with pride, rather than for publicity, will be holding their breath that anything will improve at the club under their stewardship. With Gillett in complete hiding and Hicks hiding behind PR agencies, the owners clearly don’t intend to try too hard to win back our trust.