Watch Liverpool

Posts Tagged ‘deals’

Liverpool fans have had many false dawns but justice in the high court will rid them of Hicks and Gillett and give them new hope

Throughout the grim course since the 1990s of English football clubs being bought by “owners” for personal enrichment, contrary to the game’s time-honoured tradition that directors should be “custodians”, none have been served with the wallop meted out today to Tom Hicks and George Gillett.

Beaming on the steps of the high court, Liverpool’s chairman, Martin Broughton, declaring himself “delighted”, said: “Justice has been done.” He repeated what he has said for a week, that the club’s American owners committed “flagrant abuses of undertakings” when they tried to sack Christian Purslow, Liverpool’s managing director, and Ian Ayre, the commercial director, and oppose the board’s agreed sale to New England Sports Ventures.

Broughton said the fact the judge, Mr Justice Floyd, agreed, ruling that Hicks and Gillett committed “the clearest possible breach” of their agreement with Royal Bank of Scotland, had won Broughton, Purslow and Ayre their case. The chairman emphasised again how damaging the Americans’ “leveraged [debt-based] buyout” had been for the club Hicks and Gillett bought in February 2007 with £185m borrowed from Royal Bank of Scotland – repayable in only 12 months – then loaded on the club to service. The offers, from NESV, owners of the Boston Red Sox, and the Singapore businessman Peter Lim, both proposed repaying RBS that debt, since refinanced for a series of further short periods, now up to £200m.

“The vital thing is that all the offers have wiped out all the acquisition debt,” Broughton said. “That puts the club on a sound financial footing.”

That, of course, is the burden which dare not speak its name at Manchester United, where Sir Alex Ferguson and the chief executive David Gill maintain the stance, wholly contradicted by Broughton, that huge debt – £769m in United’s case – does no damage to a football club.

Hicks and Gillett, watching Broughton, Purslow and Ayre approve a sale, will lose their loans to Liverpool, which, as the keen-eyed blogger Jaimie Kanwar has pointed out, amounted to £101m in Liverpool’s most recently published accounts, for the year to 31 July 2009, not the £144m the pair loaned to Kop, their Liverpool holding company.

This is not the exit Hicks and Gillett foresaw when they bought into Liverpool and the Premier League’s expanding TV revenues which Hicks, in particular, spoke of so eagerly at the time. That loss, and the sale of their shares in the club for nothing rather than the fat profit they envisaged, has been wrought by Broughton, the blue-chip chairman who kept his counsel for months, then came out fighting so defiantly last week.

During the quiet time, Broughton’s silence sowed doubt. He is a Chelsea fan, and as the chairman of British Airways and previously British American Tobacco (BAT), not the most obviously sympathetic figure to the Anfield faithful. Very little information was released about what he and Barclays Capital, appointed to find a buyer for Liverpool, were actually doing. Fans winced during the embarrassments of the deals which never were, fronted by the Hong Kong wheeler-dealer Kenneth Huang and the Syrian-Canadian former pizza shop proprietor, Yahya Kirdi.

It was also difficult to understand what boardroom sources meant when they insisted Broughton, Purslow and Ayre had the right to outvote Hicks and Gillett in a decision over a sale. Sure, they had a board majority, but directors can normally only recommend a deal to shareholders, which, as half-each owners of Liverpool, the American pair could surely reject.

Last Tuesday the quiet man finally showed his mettle. Despite worldwide attention and relentless prodding from the media and fans, Broughton and Purslow had managed to negotiate with NESV and Lim without a leak. Purslow observed, as many serious business people do, that the deals which are concluded are usually ones nobody talked publicly about beforehand.

With the NESV deal agreed and Hicks and Gillett having sought to block it by sacking Purslow and Ayre and replacing them with Hicks’s own son, Mack, and Mack’s assistant, Lori Kay McCutcheon, Broughton took the strategic decision to go to court, and go public. Suddenly he was on television, radio, on a conference call with newspaper journalists and even giving Hicks and Gillett a mauling on Liverpool’s official website.

Broughton revealed what we had not been told earlier: he had not taken on the job of becoming Liverpool’s chairman, getting the club sold and relieved of its appalling debt, without having the power he required. He had insisted Hicks and Gillett give the undertaking, to RBS, that only Broughton had the right to appoint and remove directors, and that they would not obstruct a “reasonable” sale process.

Saying, straightforwardly, what everybody has known since they breached their promises to build a new stadium and not load debt on Liverpool, that Hicks and Gillett had “no credibility,” Broughton said: “I was not prepared to be their patsy.” They now know that he meant what he said.

Amid the absorbing drama which erupted this week, it was revelatory to watch a businessman of Broughton’s quality operating in football. This is a sport whose most garlanded administrator is Sir David Richards, the chairman of the Premier League and FA vice-chairman, who formerly ran a small engineering company which went bust in 2001 and whose club, Sheffield Wednesday, are now in League One, still saddled with much the same £20m debt Richards landed them with when he was chairman.

This is an emerging change in the Premier League: the presence of business people of a higher calibre than those traditionally involved. Chief executives such as Ivan Gazidis, at Arsenal, seem to understand what a football club is, that it is not “just a business like any other”, the spivvy Thatcherite philistinism which dominated through the 1990s. Broughton, who has run a company with as dubious a moral purpose as BAT, has stated that a football club is different, and that debt is bad for it.

Purslow is known to have watched approvingly Arsenal’s “fanshare” initiative aimed at giving supporters an ownership stake in the club, and at the weekend he said: “I’ve asked [NESV] to consider a scheme at our club that will give our fans a real sense of ownership, a real sense of inclusion, the kind of voice they deserve and NESV have told us they’ll look at this very seriously if they complete.”

Liverpool’s supporter groups, strangely credulous when Hicks and Gillett rode into town, before waking up and mounting spirited campaigns, must now show themselves to be partners for peace-time, to play a part – perhaps including raising money as ShareLiverpoolFC always promised – in decision-making.

It may be too much to hope that Broughton’s victory might usher in a more enlightened future not just for Liverpool but for football clubs more generally. The culture is surely set: “owners” will expect to make money for themselves, by seeing the value of their club increase. But this better-educated breed of businessman seems to understand they must do so over the long term, by nurturing their clubs and working with supporters, by cherishing the game’s great traditions and heritage, as Hicks and Gillett promised and spectacularly failed to do at Liverpool.

Many false dawns have cast shadows over optimism, but justice was done today, so the reformers will allow themselves to dream.

LiverpoolBusinessDavid Connguardian.co.uk

• Hodgson allowed a number of players to leave in summer
• ‘If the truth be known, we are still over-staffed’

Roy Hodgson believes Liverpool still have too big a squad, despite allowing a number of players to leave the club over the summer.

Since taking over from Rafael Benítez, Hodgson has allowed Alberto Aquilani, Emiliano Insúa, Albert Riera, Diego Cavalieri, Philipp Degen, Nabil El Zhar, Krisztian Nemeth and Damien Plessis to leave, either permanently or on loan. The midfielders Javier Mascherano and Yossi Benayoun have also departed, although that was their choice and not the manager’s.

Hodgson has, in the meantime, bolstered the British and homegrown quota at Anfield with the arrivals of Joe Cole, Paul Konchesky, Brad Jones and Danny Wilson, while also signing Denmark’s Christian Poulsen and the Portugal international Raul Meireles. But the Liverpool manager is keen to continue trimming down his squad.

“We were unbelievably over-staffed when I came to the club and, if the truth be known, we still are over-staffed,” said Hodgson. “It was just as big a job making sure some of the players who never feature for the first team move on and that we limit our squad to players who are either in the frame to play first-team football or who have a bright future who are still anxious to play academy and reserve team football.

“We don’t want that middle group who are too old for reserve football but are not serving any purpose for the first team because they never feature.”

It could be argued that because of Liverpool’s current financial position, with the club still up for sale and no immediate sign of a change of ownership, the manager never had any choice about pruning the playing staff. However, Hodgson has been clear about the direction he wants to take the club in and believes his transfer activity this summer, while not spending a huge amount on fees, has achieved some of those objectives.

“We should be very happy. A lot of hard work has gone in and you have to mention Christian Purslow [managing director] and Eduardo Macia [chief scout],” said the former Fulham manager. “Both worked really hard during the transfer window to do the deals I wanted to happen but also to do deals for quite a few players to leave the club.

“It was important to sign a quality midfielder when we lost Javier. We had half-prepared for his departure by jumping in to sign Christian Poulsen when he became available, but it was important for us to keep strong in that area.

“We loaned out Alberto Aquilani and so we are pleased to have been able to bring in Meireles. He is experienced in the Champions League, in international football, has had proven success at Porto and is an all-round midfielder who is capable of playing in all three of the central midfield positions.

“He has a pedigree which we researched, followed and studied. I followed him at my previous club so it was good when I heard he could be available and that we could do the business quickly.”

Hodgson also revealed that Konchesky basically forced Fulham to sell him once Liverpool had made their approach.

“It was difficult because Fulham were anxious to keep him and were against letting him go,” he added. “Our good fortune was he was in the last year of his contract and he made it clear that if they didn’t let him go he wouldn’t sign a new contract.

“That was useful for us because otherwise it would have been very difficult to get him. There aren’t many quality left-backs around in the world, never mind in England, so to find an English one who can go straight into the team without any adjustment problems is a big advantage.

“He is a player I know and have worked with and he knows the way we try to play and the things we try to do. That’s another little advantage, but the main reason for bringing him here is because we think he’s a good player and he’s the right man for the job.”

Roy HodgsonLiverpoolguardian.co.uk

• Former Chelsea midfielder signs £18.7m, four-year deal
• Hodgson hopes capture will also appease Torres

Liverpool hope Joe Cole’s arrival at Anfield on a four-year deal worth £18.7m can convince Steven Gerrard and Fernando Torres to commit their futures to the club.

Cole agreed to become Liverpool’s second summer signing today when he rejected the chance of Champions League football with Tottenham Hotspur and Arsenal in favour of a £90,000-a-week contract on Merseyside. The transfer will be finalised providing the England midfielder passes a medical in the next 48 hours in Switzerland, where he has arrived at Liverpool’s pre-season training camp.

Liverpool’s offer to Cole, who was available on a free following Chelsea’s refusal to extend his contract at Stamford Bridge, is understood to have bettered the terms available in north London but was not the most lucrative deal on the table. West Ham United, one of Cole’s former clubs, made the highest offer to the 28-year-old but the prospect of joining Liverpool, and regular first-team football under the new manager, Roy Hodgson, swayed him.

Cole’s decision gives the lie to the notion that remaining in the capital on the most lucrative contract available was his over-riding ambition. The Chelsea manager, Carlo Ancelotti, claimed at the weekend that Cole’s problem at Stamford Bridge was not personal but economic.

His move to Anfield has wider implications for Liverpool, who have endured a turbulent period on and off the field recently, with the departure of Rafael Benítez as manager accompanied by doubts over the futures of Gerrard, Torres and Javier Mascherano.

Liverpool are reluctant to say anything publicly about Cole’s signing, beyond confirmation of the agreement, until a player who suffered a serious cruciate ligament injury in January 2009 has passed a stringent medical. Club officials are increasingly hopeful, however, that a transfer that has been well-received by senior players will serve as a statement of intent to Gerrard and Torres should they become the subject of bids from Real Madrid and Chelsea respectively.

No offers have been received for Gerrard or Torres, despite long-standing interest in the pair and their frustrations at the club finishing seventh in the Premier League last season and Liverpool’s struggles to compete at the higher end of the transfer market. Mascherano is a target for Internazionale and Liverpool may show less resistance to selling a player who has agitated for a move for two summers.

In the circumstances Cole’s arrival will provide a significant fillip to Liverpool who, despite the £350m debt placed on the club by the co-owners, Tom Hicks and George Gillett, have signed an England international and the Serbia striker Milan Jovanovic on free transfers, but substantial personal terms, this summer.

Selling Yossi Benayoun to Chelsea raised £5m and Liverpool intend to increase that figure significantly by reducing the size of the first-team squad. Emiliano Insúa is considering a £5m move to Fiorentina and Albert Riera is close to joining Olympiakos for a similar fee. All the deals were put in place before Hodgson joined on 1 July. The manager has confirmed a new left-back is a priority, given that three will have left since January should Insúa follow Andrea Dossena and Fábio Aurélio out the club.

Hodgson has said that Liverpool’s World Cup contingent will not be considered for Europa League qualifying duty next week, but that policy may not apply to Cole, who was restricted to just two substitute appearances totalling 44 minutes in England’s woeful campaign.

Ian Rush, who retains close links with his former club, said: “I’m sure Roy Hodgson will play him in every game, especially if he is playing well, and maybe getting regular football is a reason why he has come to Liverpool. To get Joe to come out of London and come to Liverpool is a coup for Hodgson itself. We might not have been as successful as we would have liked to have been recently, but this shows we can still attract top-name players, whether that’s an England international or a foreign international.

“We’ve got a great new manager in Roy Hodgson and he knows what he wants, and he can talk these players into signing for our club. This is the signing supporters wanted and it’s a big boost for them. You look at last season when we went into it not hoping but thinking we were going to win the league.

“This season people are thinking are we going to finish in the top four. I think this sends a sign out to Liverpool supporters that the club do mean business.”

LiverpoolJoe ColeTransfer windowSteven GerrardFernando TorresAndy Hunterguardian.co.uk