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liverpool need to desperatly secure new fresh investment if we are to push on and improve next season from what has been a failure of a season this year, pushing for fourth was not what any liverpool was hoping for at the start of the season, we need a good backup striker to torres and an influential winger to supply torres!

I dont understand why they turned down that offer.....well actually i kind of do, its because the Americans are greedy and want to have a majority stake, and they also want to make as much money as possible.

It doesnt seem like they care about the club, but only about there bank accounts. The sooner they sell the better. They are sapping the life out of the club, and soon they wont be able to compete for the top 4 at all!

A grammatical error - it should be PRINCIPAL creditor not principle (especially as RBS have no principles.

Can't the ³ÉÈË¿ìÊÖ afford the spelling and grammar check tool on Microsoft Word

A very unsatisfactory situation still dragging on and on it seems forever.

Selling up to Hicks and Gillet was the biggest mistake which could habe been by the previous owners. Financing the takeover of a club by loans which are then burdend on the clubs books should be outlawed by the PL. If you don`t have the cash to buy the shares, just stay away.

It`s difficult to see any movement at all in the near future, apart from seeing the loans refinanced again. That will not help Liverpool at all, supporters, players and the coaching staff will only get more frustrated.

Who in his right mind would invest into a club with Hicks and Gillet as major shareholders, given their dismal record. Nothing has changed since their takeover, apart from the amount of debt accumulated over the years.

If the new and extremely expensive stadium is going to be build, the debt will only rise. If that could be compensated by much higher matchday revenue and leaving real money to be spend in the transfer market remains to be seen. Arsenal hardly spent anything in the transfer market in recent years and their financial structure was in order, before the building work started.

As a fan, I am still confident we can get that golden 4th place. But if we don't I'm afraid we can be come a rubbish mid-table team. Shameful for the greatest club, with the richest history.

It's odd really one of the main reasons that DIC never went ahead with their proposed buy out was antipathy towards a leaked memo suggesting a sale with Liverpool later on this decade. But this is what's exactly happening now, clubs come and go with different owners (albeit not at Portsmouth rate, an exception). Liverpool need fresh investment, if not new owners altogether. But with Hicks and Gillet operating 50/50, what would the new composition be with a third owner? My guess is that only a total buyout with Hicks and Gillet making a decent profit will see them out. Alternatively a new investor who's happy to be a subordinate?

How come Liverpool seem to be struggling much much more with their £350m debt than Man U are with their £700m+ debt?

I think we may be entering a phase of protectionism, and football may well be hit by this. In my opinion, in the next few years there will be much greater regulation on foreign owners buying Premier League clubs, and the financial mechanisms through which they buy the club will also be heavily regulated. Moreover, with football supporters' sentiments rapidly turning against these private owners (both foreign and UK based) who buy the club with no direct link to it, and whose sole motivation is to make a profit, I can see a much larger fan input into the running of clubs in the future, or for fans to be heavily influential in who buys their clubs.

Football supporters in this country, at least in the past, have heavily been influenced or reflect left wing socialist or social democratic values. So it is no surprise that so many supporters find the modern football ownership model morally abhorrent. The pursuit of private profit for them has certainly NOT led to the common or social good. And this is the big issue here. For a lot of football fans, their club is not just a business, nor is it just a football club looking to be successful in a league. It represents their community, and in the past was an opportunity for working class people to join together for a common cause, and to forget about the injustices and inequalities of working life for a few hours to cheer their team on along with fellow like minded supporters. This sort of defiant congregation by working class people at football games is something that could only also be seen at trade union protests.

I think a lot of football fans are returning to this mindset, and despite the globalisation of the game and the fact that football has embraced the free market, fans still are very important to the clubs. If they can mobilise and, as one, express their dissatisfaction at the direction the game is going, then I think reform is entirely possible. Cooperation and community based spirit, two things that have gone from society since Thatcher actively promoted individualism and self interest in the 80s, will be crucial if football fans want to bring about change.

But the question is, what exactly do the fans want? This is probably not completely clear, but what is clear is that a significant number of football fans detest the current business model of football. Ideas such as a cooperative ownership model have been suggested, as have the models of teams like Barcelona (we need to be careful, however, because Barca's model isn't exactly as socialist or cooperative as some make out, although much preferable to what we have in England). Perhaps the exact economics of the model haven't been worked out, but I suspect it will involve strong fan power, links with trade unions and most importantly, the people in charge will be local men with strong ties to the club, whose motivation for running the club won't be profit maximisation, but to ensure that the football club gives the local supporters a symbol of the community, something to be proud of and something that reflects their beliefs and attitudes.

Perhaps some people say these are ideas that are dead these days, that socialism, corporation and community values have been extinguished in favour of individualism, profit and globalisation. I don't think so, because as exemplified by the strong protests against globalisation at London (and in the past at Seattle) it's clear people don't like the status quo. People want change, and regionalism is something that is being looked upon favourably by a lot of people (even the Green Party are advocating this). It is also clear that a movement towards regionalism has big implications for football, and encouragingly, may return football to its roots.

I believe Liverpool may be the club and city in which such a movement first starts to gain traction. The city itself has always had a history of left wing, socialist political ideas and values. Bill Shankly himself believed in socialism (maybe not precisely in terms of the ideology, but more so as a philosophy towards cooperation and helping your fellow man, and relying on a team rather than an individual) and realised the social importance of the club. If a lot of the Liverpool fans reflect these values, I think we may see the first roots of change growing in the city.

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why are liverpool fans ( amd manu fans for that matter ) moaning about the american owners of their clubs ????????
When these premiership clubs sold out to foreign investors what did they expect ??? They're running these clubs as buisnesses, nothing else !

Why don't the fans (club members) team up and try and run their clubs like real madrid and barca.. social co-operatives, owned by the club members who vote to elect the president, and funded by LOCAL buisnesses and banks (who have a real interest in the local community, and are not just there to make money from the club, by selling it for a greater price than they bought it)

All the people on this site that critise real madrid make me laugh..
How you wish your club was run like real madrid !!

There is NO people power in the english game anymore.. the once working class sport has been taken over by buisness investors, etc..
but you only have yourselves to blame for this... you ALLOWED this to happen, you have behaved like serfs, and let these people take over your clubs....(at least manu fans are really trying to do something about it !)

United and Liverpool have been bought by US investors whose intentions are to hold the clubs for the medium term (5 - 10 years) and then sell for a profit.

This theory (a widely used business one) is that as long as the total value of the debt on the clubs balance sheet + the equity initially injected is less than the market valuation of the club then they will make a profit upon sale.

I'm unfamiliar with Liverpool's figures but for Utd there was £100m equity injected + £700m in debt (approximately). Currently sales figures banded about are £1bn so I imagine the Glazers will be happy with their £200m profit.

The problem arises when the value drops below the commbined value of the debt and equity - thus the sales price would clear the debt and deliver a profit. The investors don't want to lose on their investment and the club becomes a going concern.

Should Liverpool finish below 4th this year their value will undoubtedly diminish and the club will not be worth enough to clear the debts. This is when administration/liquidation become prossible outcomes (although remote at this stage). However, it is certainly clear in this instance that funds would need to be raised (selling players) and no new players would be coming in.

At 4:39pm on 09 Apr 2010, BADGER_is_my_hero wrote:

How come Liverpool seem to be struggling much much more with their £350m debt than Man U are with their £700m+ debt?

Their not. United are struggling just as much. Their recent refinancing through a bond has raised their interest payments from 42 million to 45 million. They only just made a profit when including the sale of Ronaldo and 36 million from their new sponsors - a deal that is worth 80 million over four years and doesn't officially start till next season. I,e they have had nearly half the money already. Why do you think they didn't buy Tevez it wasn't that Fergie didn't want him it was they could not afford him or David Villa for that matter.

tossedandblown:

I think you're missing the point of these deals - the clubs are not concerned with making a profit year on year, only when the club is sold. If a profit is made then tax is paid which debt finance typically avoids (and typically why it is cheaper than equity for a club).

It is just as obscene having Liverpool and ManUtd owned by banks, yet in the control of people who are there purely to milk the clubs out of millions of pounds each year, as the Premier League is by having a 'fit and proper person test', that even Idi Amin would have passed.

To answer tjs question, "How come Liverpool seem to be struggling much much more with their £350m debt than Man U are with their £700m+ debt?"
In his own (un)funny way BADGER_is_my_hero is partially right, Utd have a far larger fan base and ground and even though they lost in Europe, they'll still make more money from European football this season than Liverpool will, even if they win the Europa Cup.
...but also, selling Ronaldo for £80m helped an awful lot, just enough to cover the interest payments on £700m+ debt for 2 years.
One dire year; no CL football or trophies; for either team could see administration, no matter what either clubs owners claim.

Good article Dan Roan.

How come Liverpool seem to be struggling much much more with their £350m debt than Man U are with their £700m+ debt?
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liverpool are a small club playing europey league football with no fans outside norway.

united are a big champions league side with a global fanbase.

go figure.
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I think you need to check your information first before making a contribution.

Liverpool has an extensive fan base outside the UK, with over 200 supporters club around the world. Moreover, the recent 10 year contract signing with Adidas for £150m is premised by the fact that Liverpool sells just as many shirts worldwide as Manchester United. Go figure.

One of the reasons why Manchester operated in the black last season was because of the sale of Ronaldo. After that, their debt will only continue to grow and become even more pronounced. I think their gate receipts helped in debt payments, but there will be a limit to that once the debt servicing payments become inevitably too much.

Liverpool are a small club? Such a pathetic comment is really not worth the time typing a reply. Liverpool's new shirt sponsorship deal with Standard Chartered is equal in value to United's with AIG. Liverpool, like joe_canada said, also have a massive shirt deal with Adidas. And Liverpool have won more trophies than Manchester United. Go figure.

Just a thought for you Liverpool fans. Who sold the club to the Americans? Should the shareholders who sold their shares take a lot of the blame for the debt crisis. Afterall, they have walked away with their share sale proceeds and perhaps didn't sufficiently consider the welfare of the club.

Best of luck in Europa Cup. At least you may win more than Man U and Chelsea this season.

Interesting article, in that it brings us up to date. I don't however see any real conclusions? Either Liverpool are in trouble with the debt or they are not, seems to be the extent of the insight.

The fact of the matter is, they are saddled with a debt which the current revenue projections cannot service, without selling some of their players, or finding investment. Without Champions League football revenue will be lower next year than forecast, and at this point Liverpool are not favourites to get the crucial fourth spot.

Unless a new investor is found, then someone will be sold to provide revenue to cover the clubs operating costs. That could be 10 million or 50 million. The difference between selling Babel or Gerrard.

Now this might seem like a daft idea, but desperate times call for desperate measures. We all know that to say Liverpool and Man United fans do not get along is an understatement, and yet both are essentially fighting the same battle here. So has anybody though of forming a loose alliance between the two groups to put pressure on football authorities to back them up in their campaigns? That two such disparate groups can put aside their enormous differences and cooperate should send a message to anyone who knows anything about football, and let them know just how seriously the fans take this issue. If the Glazers or Hicks and Gillett knew they were despised more than the old enemy from down the East Lancs Road they might, just might, be more inclined to leave.

Personally I think that thie situation that Liverpool (and Manchester United) are in makes a total mockery of the FA's 'Fit and Proper Persons Test'. Surely one of the main things the FA should be doing is making sure that clubs like Liverpool and Man United arent being bought by foreign owners whose main purpose is to dump the debt of their other interests otno the Club they have now bought?

Until the prospective owners are out under much more scrutiny, in terms of finance, aims they have for the club, investment plans etc then they shouldnt be allowed to take control of the club. Thats not to say I think all foreign owners are bad, Lerner at Aston Villa, certainly does not seem to have done them any harm in terms of investment are debt structure, but I do think more questions have to be asked before anyone conglomerate, person, or pair are allowed to but into an institution be it a League Two, SPL, or Premier League club. As much as previous owners are to blame in terms of selling off in order to further fill their deep pockets without being overly concerned with the clubs future, I do think that the respective assocation of the club that is being bought, eg FA, SFA, DFB are duty bound to ensure that the fans of the club that is being bought are looked at being bought, is a high, if not number one priority on their fit and proper persons test as opposed to what the only criteris seems to exist at the moment which is "How much money do you have?"

One thing I do hope though is that both Clubs still exist even if the worst happens and they go into the dreaded 'administration', and whilst I grant this isnt likely, or rather fans of these clubs believe is unlikely, maybe its what both clubs need-that way those who are the most important cog in the machine-the ordinary supporter can then invest into their respective beloved clubs and have a say as to how they should be run, meaning that they need not fear being taken over by more foreign 'mercenaries'.

Will someone explain why the current owners of Man City decided to buy that club and not, say, Liverpool? Surely if Liverpool had had the injection of cash that City did, they'd be pushing for the title this year and have fared much better in the Champions league. And surely the Liverpool brand, with all due respect to City, has a much bigger international cachet? I'm not great at maths and I'm sure someone is going to put me right, but if even close to 100 million buys 40% of the club doesn't it have to be the better long term investment? Put it another way- why spend the money and time that are going to be necessary to try and turn City into a major international club when you could do resurrect Liverpool to international glory with a lot less effort (bearing in mind Liverpool's current squad isn't that different than the one which won the Champions league)?

Diggsgiggs, in fairness to City, they might not have Liverpool's history (few clubs have), but they DO have a history and tradition with fantastic support and a brand new ground. Eastlands is fit for purpose with expansion in the pipeline and is virtually full for most home games. Not bad for a club without a trophy in 34 years. The problem with Liverpool and United is that they are probably too big. Would it have made sense for Sheikh Mansour to buy Liverpool for over £200m an then commit to building a new ground for in excess of £500m and rising? City cost less than £150m and are a club that with investment could achieve great things. Football moves in cycles and maybe just maybe its City's turn to be the next great thing while the likes of Liverpool could possibly over the next generation become an average club again. Some might say that's a shame, but they are a club that hasn't won the league title for 20 years. What divine right do they have to win everything?

@diggsgiggs

I think it comes down to the price of the club. The people that bought City were able to do so at a knockdown price because of the epic fail of Thaksin Shinawatra. There's no way they'd have got Liverpool at a price worth paying whilst the Yanks were reluctant to sell other than for a major profit. Plus they don't have the weight of expectation at City like they would have at Liverpool, so could go in with a clean slate and start pumping money in. Also, I believe Al Mubarak is a City fan, allegedly...

With research, Al Mubarak got City for £200m. The Liverpool owners, I'm guessing, value the club at more than £600m given their rejection of £100m for a 40% stake.

Hicks and Gillett are smart business men and know very well that their personal interest can not be placed above the interest of Liverpool Football Club and fans all over the world. Fans are watching and I think their patience is thinning out and fading fast.

All this backroom politics and uncertainties do affect performance on the pitch regardless of other factors. Let us hope common sense will prevail?

Selling LFC to the Yanks was purely based on "greed" by the previous owners!! They basically talked about how they cared for the club and would do everything possible to ensure the club was sold only to people who had genuine interest in it. However, Moores, Parry and co, fully knew that the Yanks had neither the background or interest in football, let alone LFC, but since they offered more than anyone else they were more than happy to ditch the Arabs (who were checking LFC's accounts at the time). After the club was sold the Arabs said they were saddened (insulted) as they thought they had an agreement with Moores and Parry about buying LFC, and felt the club was sold at an inflated price!!
The Yanks looked at Man Utd and thought as LFC is of similar status/size it would be a very profitable business for them. Basically, buying something on the cheap, and then invest a minimum amount to get a maximum return. However, i believe because of their lack of football knowledge they miscalculated few things about how the "football world" functions, hence still over valuing how much the club is worth!! They don't seem to understand, or are too greedy, that you can't value a club based on future projection/potential if all the pieces in an equation falls in place!!
I also remember that many LFC fans making "anti-Arab" comments like how it was better the club was sold to the Yanks rather than the Arabs as they were "funny looking/believing people"!!
The best thing for the club might actually be for them not to qualify for this season's champions league as that will actually force the Yanks to put a realistic selling price for the club. LFC will always remain attractive to potential buyers, esp rich Arabs, Oligarchs, Chinese, etc as it generates so much publicity and public exposure in the West!!

The sad thing about all this is that the Liverpool name with all its history and prestige is being dragged down by these money grubbing yanks,the sooner they depart the better.

The Yanks should cut their losses and get out. They're never going to get a profit out of the club unless they invest some money, which as everyone can see is never going to happen. It is despicable that they were allowed to take over the club with borrowed money and burden it with debt anyway. Hicks and Gillett owe the money, and selling the club is the right way to start paying it back.

But now they've gone and made a mess of everything. If they sell up and Liverpool get someone who actually has some money in to replace them, then we could be signing players like Villa, Silva and Mata rather than mid-table standard players like Kyrgiakos.

One of the main stumbling blocks in all this is the fact that the 2 yanks can't even talk to each other. That's going to make a difficult situation even worse. I hope David Moores is happy with this situation after trousering a huge sum of money. He's been very quite hasn't he. Talk about selling us down the river Dave, thanks a bunch. It's always us fans that pay the price.

Only way to cleanup this mess is put Liverpool and Man United on administration. The caretakers' first priority should be to reduce the debts. Money should be raised by selling players Rooney, Torres, and what have you. Send both clubs to Championship and have them start from a clean slate. Promote the usual top two finishers from Championship to PL, and stage only one round of playoffs among 3rd through 6th place team. Winner of 3rd vs. 6th, and 4th vs. 5th place teams in playoffs should be promoted, and lastly under a special ruling by PL QPR should be promoted to give Chelsea a real local rival in PL.

# 31: U11148453

Sorry - but which planet have you just beamed down from? I gather from your comments that you don't understand finance. Please, unless you have something constructive to put to the debate don't bother.

IvanIdea

very good comment you are right United (MUST) and liverpool (Spirit of Shankly) should put the rivalry aside and join forces to oppose their American Owners.

But what happened when MUST approached SOS before the recent Old trafford game between the two sides to try to initiate discussions about a joint/seperate protest before/during the game, they were dismissed by SOS with a childish comment saying were not talking to 'Norwich'. Now if thats the attitude in SOS then we arent going to get anywhere to promote our disgust and embarass the respective owners.

You make an interesting point in your conclusion regarding RBS being 70% taxpayer owned. That would make the decisions they make in relation to any refinance heavily scrutinised so they wouldn't exactly to be able to offer 'mate's rates'.

Liverpool it seems may be in for a bumpy ride in the near future but it's not the end of the world, pretty much all clubs have gone through acrimonious power struggles. It may just be Liverpool's turn.

Agree new investment needed, but let's be honest how many real football fans are big money investors? The ones who are (Mike Ashley), more than regret getting involved in club ownership. Very few happy endings here. I'm all for fan ownership, but committees and co-operatives are painfully bureaucratic and consensus never works (ie. voting on anything and everything). Single minded vision works all the time because things get done. For all the talk of socialism in these pages it was Peter the Great's vision that built Russia's greatest city, St Petersburg, not the meeting room collective of communists. So fan ownership yes, but remit is needed for one elected person as President with a plan to move forward unhindered.

PS. Doesn't Dan Roan look like a judge from 'Strictly Come Dancing'?

I've been following the progress of Share Liverpool FC ( recently with great interest. I think that it is a fantastic and progressive idea for the fans to own the club, based on the model displayed at Barcelona and many other European clubs. However, it appears that most fans are more in favour of the 'sugar-daddy' billionaire owner like Abramovic that can pump money into the club with little regard to common sense or the fans. I find that scenario almost as depressing as our current situation; money does not care about Liverpool FC, the fans or even the players at the club. Money cares only about itself. It is money that has got us into this mess.

Thinking about it though, if, as a taxpayer, I own a part of RBS, doesn't that mean that I own a part of Liverpool FC?! Maybe Share Liverpool FC will get their way after all...

There is a fine line between investing and gambling. The so called yanks are gamblers pure and simple and though it may seem unlikely in 2010, we have the example of Leeds United Football Club (LUFC). I cannot claim to have all details of the financial deals but it goes like this, "To finance the purchase of a depreciating asset (players) with a long term arrangement is a gamble, conversely to finance an appreciating asset (new stadium) with long term loan is an investment. LUFC financed players with long term finance with crippling interest payments so when the players depreciated so did the clubs fortunes. The last I heard LUFC was struggling somewhere in the 3rd or even the 4th tier. LFC and MUFC you have been warned. So if scenario of (debt + equity) being less than market value becomes a reality then LFC is doomed, as as in the example at leads there is simply no way back to the top flight. ADIOS LIVERPOOL!!!

#33 Andrew Carr
I didn't realise that an attempt had already been made to join forces, and I'm saddened if it was the Liverpool fans' group who knocked the offer back on childish grounds.
One thing is very clear. Manchester United fans, no matter how much they may be disliked by us in Liverpool, do not pose a threat to the very fabric of the game we all love. Indeed, the true fans who follow their team with a passion week-in week-out are an integral part of that fabric. From our point of view they just support the wrong team.
On the other hand 'investors' who buy a club by essentially motgaging it to the hilt and whose business plans for repayment and reinvestment are based on uncertain success are a real danger; if we can get rid of them first, then we can settle back down to our traditional rivalries.

Hicks and Gillet are, clearly, completely wrong for Liverpool, but reading some of these comments I wonder what exactly LUFC fans want out of their owners. They want investment in the playing squad and, I infer, to be pushing for league titles, but they don't want foreign ownership or billionaire 'sugar-daddy' owners.

Sorry, but times have moved on - the miniature socialist economics essay in post #8 fails to realise this. The days of a local-boy-made-good millionaire buying the club he loves, pumping a few bob into it and having a good run are long, long gone - Everton's chairman has gone on record a few times as saying the day of the 'mere' millionaire in top-flight football is over. Billionaires are the order of the day, and one doesn't become a billionaire by getting misty-eyed when Bill Shankly is mentioned or the first few bars of You'll Never Walk Alone are warbled - you become a billionaire by being ruthless, chasing profit and focusing on money and looking after #1. Fans naturally find this a bit hard to grapple with, almost exclusively coming from more modest means than the owners, but we have to understand that it's not necessarily a bad thing, as long as the RIGHT money-grabbing billionaire buys in.

Look at Randy Lerner at Villa. For all people bang on about the evils of foreign (specifically American) ownership with all the fury and lack of insight of an Enoch Powell speech, there are foreign owners who have really brought the clubs along - Lerner has been the model of quiet efficiency at AVFC, and he's always my first counter when people start yelling at me about how all Americans are evil, don't understand football, and will kill the beautiful game. Tosh and rot.

There are, then, two options. The fans buy the club through those supporters' pressure groups, but then quickly realise that they don't have the capital to invest in the playing squad - even if you combined all of the money in my pockets plus all the money in several thousand other peoples' pockets, I doubt we'd scrape together enough to pay long-term Benitez target David Silva for more than 4 weeks - or you accept the reality that football has changed, the poster of comment #8 is living in a trade unionist pipe dream, and hope that the club is smart enough to find the right kind of billionaires to finance it.

The middle ground is the election system they have at Barca and Real, but they tend to get hijacked by complete lunatics (Perez) coming along, promising to buy every player in Europe, and getting elected by a landslide on crazy promises (cookie for the Simpsons reference) - hardly a 'fit and proper persons test' is it?

The only hope for Liverpool is that they win the Europa Cup, a Mickey Mouse trophy that will contain enough adhesive to paper over the cracks. The refinancing is not a problem, it will be done. 70 per cent of profits spent on interest payments is madness and leaves little room for manoeuvere, swing a cat. Good business is to sell Gerrard at 30 years old raising a years interest payment. If Gerrard departs will Torres want away for £80 million ? Another piece of good business for profiteering entrepreneurs. The only solution that can possibly save Liverpool from a decade of mid table obscurity is 100 million in the transfer kitty. The big problem is which manager do Liverpool entrust to spend a 100 million? 4 decades of Merseyside suffering for Toffee fan's are at an end as the last two Merseyside greats that speak the scouse twang sing their swan song for the Last Chance Trophy, if you think it's all over ?

As an impartial observer, I find this debate all the more interesting as it serves as a smokescreen for the what I think is the real issue here.

Benitez has spent millions in the transfer market, and generally his spending has been pretty disastrous. Yeah, Torres is world class but think about Babel, Riera, Voronin, Lucas, Aquilani? You could even question Kuyt who is a workhosre but is he good enough for the mighty reds - not really. A Liverpool side in the top 4 competing for honours with an attractive side is going to make the club so much more attactive to investors and finally rid the club of two money grabbing owners who are only interested in dollar bills.

Benitez is getting uptight because he can't spend money. Based on his track record of impulse buys the last thing the club needs is for him to be given a transfer treasure chest, because this 'mud against the wall' policy ain't working. Time for a change.

So yes, the Hicks/Gillett partnership has been a joke but it would be very unwise to judge the clubs future fortunes based on manager who will buy players on a whim. Sometimes a managers tenure naturally runs its course - this is one of those times. Bow out gracefully Rafa.

7. At 4:10pm on 09 Apr 2010, tj wrote:

How come Liverpool seem to be struggling much much more with their £350m debt than Man U are with their £700m+ debt?

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The point about debt is not how much you owe, but whether you are going to be able to pay it back in time. If there is doubt about Liverpool qualifying for the CL, which is where the money is in football, there will be doubt about their ability to pay their debts.

It's also about who you owe it to. Liverpool owe their money to a bank that is (or was) itself in serious trouble. Although whether anyone wants to be remembered as the guy who pulled the plug on LFC is another matter.

As a Toffee, I should be laughing but so many of our fans STILL want our club to be bought by a rich foreign investor! Because like everyone else, they think this just can't happen to OUR club.

#39 Mark Jackson
You are indeed correct about the level of investment needed, and about the requisite business acumen of said investor. But the issue is not where the investor comes from or even whether he likes football, but that he does not buy the club by borrowing enormous sums against it. This is not a stable business model and a drop in revenue, such as would occur through failure to qualify for the CL, could spell disaster for the club.
Reporting of fans groups' action tends to focus on the irrelevant, such as the nationality and lack of interest in football of the owners, while in fact the concerns are genuine and based on sound principles.
As to the solution? Not permitting large debts to be secured against a club or its revenues would be a start, going hand-in-hand with legislation to compel clubs to limit spending to match their revenues. Whether football authorities would be able to put such trading restrictions on what are after all registered companies is another matter.

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Although not a fan of either United aor liverpool, United do have the right idea. If an considerable offer is tabled for one of thier players they will consider it and negotiate, not only that United have over the seasons kerbed thier spending and looked at the quality in the side, where as Liverpool only seem happy living off thier history still thinking they are the best team in the world and promtly spending mnoney they dont have on "Top Stars" who cant even break into the team and when they do spend it sat on the bench. liverpool need to wake up and smell the coffee the manager has spent millions of pounds the club cannot afford on players he does not need and wont consider selling the likes of torres or gerrard who are thier main assets because lets face it without them they are most definatly a mid table club. But if the club continues to spend how they do and perform how they do, the decision to sell these players may well be out of their hands. Time is not on thier side and they need to act fast.

hey adampsb

you need the grammar check tool on your machine too fella! You forgot the brackets at the end of yer sentence and it should be "...RBS HAS no principles" given that the firm is a single entity!

happy for someone to correct my grammar...if that floats your boat!

MarkEFC has it spot on. Nobody who supports English footbal would want to see Liverpool's demise into mid table obscurity, but consistantly shelling out millions on mediocre players will equally force the likes of Gerrard and Torres to ply their trade elsewhere. Its not just a regime change at the top that is required but also at managerial level and the club needs to act fast.

is it difficult/realistic that liverpool is owned by the fans? barca is like this i understand, but how does it work? i only know that many barca has passionate supporters like liverpool. what would need to be done as it surely seems to be better than foreign and money seeking ownership?

We the football fan live in fantasy land!!! This is reality and reality dictates that no one throws money away for the sake of it!

A lot of football clubs are going to end up in big trouble because of the fans delusions. Most of us want a sugar daddy that we can dictate how we spend his money. The best thing we can do as real fans is take back the ownwership of these clubs and put our money where our mouths are. We are the only ones who care about our clubs and therefore we should be the custodians of it and it will also actually make us more realistic in our expectations because we will be the ones funding it.

It pains me to say it, but I beleive Liverpool failing to finish 4th will end this debate once and for all because the hopeless Americans will have to act. The best business brains will tell you that there comes a time when a deal becomes so unworthy it is better to terminate and cut your losses and I believe Hicks and Gillet are at the precipice.

Losing out on champions league football will devalue the club and more investor will come in smelling blood. If it is city that get that fourth spot, we are probably looking at another dawn and era in football. The Americans could fight it out to the bitter end like Mike Ashely and get another Bank to bail them out?(unlikely)or conduct a fire sale of the top stars and of course we know who they are.

I wish now that DIC took over because there was a clear plan from them. A built football Stadium that would have enabled us to eclipse Man Utd and restored us to our righful and envious position of number one. whether or not it was greed that left us with Hicks and Gillet, it was always about money and it will always be about money.

It is clear that letting investors buy into a football club purely for financial reasons is creating a lot of grief for the fans, especially if those investors have no particular affinity with the club.
A football club IS a business but it has far more passion than a regular corporate position. Such investment puts that manager, players and fans in a different place than those who are supposedly looking at the ambitions of the club and this will, of course, create friction.
The buyers, investment groups and owners must have not just the financial aspects of the club at heart but also the sentiment and following of the fans. This is not happening at Liverpool and ManU.

Now don.t get me started on the other flawed football business model in which a billionaire buys a club and dumps money into it with no financial cares...

Steve
"With research, Al Mubarak got City for £200m. The Liverpool owners, I'm guessing, value the club at more than £600m given their rejection of £100m for a 40% stake."
If they rejected 100 million for 40% the club it is worth something over 250 million - a long way off 600 million, and a realistic price.
But would the yanks sell?
And would a new investor not bring his own can of worms?

Having said that I totally agree with all the posters who mentioned that Liverpool have 'lost' or 'wasted' millions in the transfer market. What it means for 'pool and United is that they can no longer complete with the bankrolled and richest clubs for the best players, and that will lead to a longer term demise, certainly something to get upset about if you love your club.

slim down squad by getting all dead wood off loaded,accept any offer for them and add money to the total amount raised to buy two wingers, a speedy left full, a centre half,and do it the day the season closes.

And I reckon that all those United and Liverpool fans who have gloated on Arsenal's failure to win anything in 5 years will be forced to eat their words. Those 5 years have seen a financial re-organisation in N London that as produced a super stadium ( something that Liverpool want/need), improved youth facilities and manageable debt. This will hold the Gunners in good stead for the next 5.
This is where Liverpool wishes it could be, not to mention the squad of young potential!

( Not an attempt to wind up 'pool fans - I consider them, a truly great club too)

Why should H&G give up a majority stake in the club for £100 million?

This is effectively what the Rhone Group were hoping they would do, so it's hardly a surprise that they declined they offer.

In simple terms, they could flog off three players (I think we know which ones) and raise that cash tomorrow.

The fans might not be satisfied, but the banks would.

LFC is potentially worth a FORTUNE and the American duo know it. It's why they snapped it up for a song.

The "potentially" is dependent on two things -

1. The new stadium. Tom and George will not leave of their own volition until this is in place. It might take years but they'll keep spinning plates until it is.

Revenue streams will rocket, as will the value of the club.

2. English clubs follow the Spanish and Italian model and negotiate their TV deal independently. Make no mistake, this will destroy the English game as we know it, but what do two sets of American speculators care about that? Man United and Liverpool FC are desperate for this to happen, and it will happen... it's just a question of when, not if.

Again, revenue streams will rocket, as will the value of the club.

Both these things will (almost certainly) happen in the next ten years. If I were Tom and George (and, indeed, the Glazers) I'd be sitting tight and making sure they happened sooner rather than later.

As a United fan I do not want to see the scousers go into administration and it likely won't happen for at least a few years, but you gents really have to get rid of the parasites.

We're working on it ourselves, but I don't see the massive movement there is from MUST from your lot.

If you're going to be that pedantic adampsb (2), I feel I should join in - The spelling/grammar checks on word wouldn't have picked that mistake up!

Just a thought but perhaps Liverpool not qualifying for champions league football and missing out on the 20million bonus that goes with it, could actually be the straw that breaks the camels back and forces hicks and the best a man can get out.

Ryan may have a point there. Perhaps all our suffering is not in vain. But the reported asking price of £600 million looks unrealistic to me. The owners should look for the debt to be settled and to take out what they have put in. As a business LFC has lost value during their ownership aqnd to look for any kind of profit tests the imagination.

@ Number 8.

I really enjoyed your post. Thing is the fans won't complain if they have an owner that can lavish money on the playing staff to start collecting silverware. They don't care about any high minded ideas about "community" or whatever. They just want to see their team win games.

Football stopped being about the working class and local communities a long time ago. The clubs like to exploit those kind of ideas because it keeps a hardcore loyal local fan base...on whose potential gate receipts it is possible to borrow.

Sorry to dampen your hopes, but next will be a billionaire for Liverpool and Man U, probably from the middle east, India, or China.

At the end of the day (apologies for the cliche!) the 2 yanks aren't going to do anything unless it's in their interest to do so. Let's face it they don't care about the club or the fans. Depressing I know, but sadly true. I hope David Moores is happy that he brought his 'beloved' club to such a sad state of affairs.

PS: It doesn't help either that Rafa's dealings in the transfer market have been abysmal - apart from Torres. This is his team now and I can't say it's come any further than the one he inherited from Houlier.

Yep, I agree with FedupwithGovt, Rafa is hopeless in the transfer market. Reina, Arbeloa, Mascherano, Alonso, Agger and Crouch were terrible buys!

I mean come on, I really hope you put more effort into voting this year!

Now to the point in question, should we be happy with this or not? In the past three years we've gone from being £60M odd in debt to a Barclays loan of £300M, and still no stadium. One would have to ask where this extra £63M has come from too seeing as Purslow said our debt was only £237M a few months back??? They may be on their way, or they may have just found a bank stupid enough to lend them more money, time will tell.

As for MUST, how can buying a scarf to semi hide the brand new Man Utd kits you all wear be effective? Does it hit the owners in the pocket? No! Which is what both sets of fans need to do.

Hicks track record could mean Liverpool to play in ³ÉÈË¿ìÊÖbase green.

From Wikipedia: Corinthians
In 1999, Hicks, Muse, Tate & Furst bought Sport Club Corinthians Paulista, a successful Brazilian club team. The club initially succeeded under the new ownership group by winning the FIFA Club World Cup. Before the purchase of the club, the ownership group assured the fans that a new stadium was in development. This never materialized and after legal/financial troubles and partner infighting, Hicks retired from the company and the ownership group eventually sold Corinthians. The ownership group drew the fury of Corinthian's fans due to financial decisions, the introduction of corporate sponsors on the players' uniforms and the changing of the club's colors. The club was eventually sold and left in a worse position after they were relegated to a lower level league. Comparisons have been made between Hicks's Brazilian failure and his current troubles at Liverpool Football Club.

My sinking feeling has got its own sinking feeling.

Let me re-try without the link.

As seen on another forum:

""Basically the situation's completely hopeless. Either the Glazers sell it on for a big profit and somebody has to spend [loads] over the odds to pay off the debt, or nobody buys it and the Glazers continue to asset-strip it. Either way they get theirs, they don't [care].""

The only solution is for United to get relegated and the fans to boycott the club, forcing the Glazers to sell at a loss to avoid an even bigger loss."

Same applies to Liverpool.

No. 10, it appears your comment has been misplaced by the moderators.