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Posts Tagged ‘shareholding’

• Rhone Group bid for 40% stake at Anfield
• Under-pressure owners may be forced to accept

Liverpool are in talks with private equity firm the Rhone Group over a £118.5m deal to buy a controlling share of the club and halve its debts.

It is understood the investment group wants a 40% stake at Anfield which would considerably strengthen the club’s financial position.

The Rhone Group’s bid would give them the controlling interest, with co-owners Tom Hicks and George Gillett reducing their shareholding to 30% each.

Hicks and Gillett, were last year told to cut £100m from the club’s £237m debts. The Royal Bank of Scotland gave the club a deadline of this summer to pay up.

The club’s chief executive, Christian Purslow, has been working to find investors and says he wants a deal by Easter.

The offer from the Rhone Group – which is the first real result of Purslow’s wide-ranging search – would be used to slash the club’s debt by half. That would make Liverpool a more attractive option for further outside investment.

It would also improve the club’s credit-worthiness, which could lead to work finally beginning on the long-awaited new stadium in Stanley Park.

Details of the offer were received by Liverpool yesterday and the matter has yet to be discussed by the board.

There have been suggestions that the American co-owners are looking for a better price, but with the clock ticking it may yet prove viable.

The Rhone Group was founded in 1995, has its headquarters in New York with other offices in London and Paris and describes itself as “one of the world’s leading mid-market private equity firms”.

LiverpoolBusinessguardian.co.uk

• Christian Purslow dismisses suggestion as ‘preposterous’
• Managing director confirms hopes over new investors

Christian Purslow, the Liverpool managing director, has said Fernando Torres and Steven Gerrard will not be sold simply to service debt loaded on to the club by Tom Hicks and George Gillett. He also confirmed that a complete takeover of the Americans’ shareholding remains an option for potential investors at Anfield.

It has been another turbulent week for the Liverpool hierarchy, with Tom Hicks Jr resigning his position as a director following an email row with a fan. But Purslow issued assurances about the stalled stadium project and his ongoing search to attract investment as part of an equity raise demanded by the banks that granted Hicks Sr and Gillett their latest refinancing deal in July.

Liverpool’s manager, Rafael Benítez, who tonight signed the winger Maxi Rodríguez from Atlético Madrid without paying a transfer fee, has admitted an outlandish offer for Torres or Gerrard would be discussed by the Anfield board, but Purslow insisted: “The suggestion in any way that we would sell players in order to pay down debt or pay money to our owners is preposterous. Neither is true. Neither is possible. Any proceeds we generate from the sale of players can only go into our player account for the recruitment of new players.

“It’s in the public domain that the owners have been looking to bring new investors into the club to pay down the existing debts – which are today about £237m – by way of issuing new shares which would dilute their shareholding in the club. That process is ongoing. The debt we have today is obviously serviced by the club in terms of interest and bank fees and if we reduce our debt then clearly those interest charges and bank fees will reduce.”

Despite claims at the time of Liverpool’s successful application to be part of England’s 2018 World Cup bid that work on the club’s proposed new stadium could begin before April, Purslow admitted fresh investment must occur first. “The process of bringing in new investment and reducing our current debt will create a context whereby we can seriously get back on track the stadium project,” he said.

Hicks and Gillett intend to dilute their shareholding rather than sell up entirely and forgo any profits made once the stadium project is under way, but the managing director has conceded a complete takeover cannot be discounted in a limited market. Purslow added: “Provided all goes well, there is a serious possibility of new fresh investment. There are no guarantees – we are operating in an environment where, as everybody knows, it hasn’t been the most active investment market. But largely because of the quality of Liverpool Football Club, both as a club and as a business, we haven’t had problems in attracting interest.

“However, the devil is always in the detail and in the coming months our job is to get somebody over the line that makes sense for all concerned. That could be part ownership or it could be complete ownership.”

LiverpoolSteven GerrardFernando TorresPremier LeagueAndy Hunterguardian.co.uk