SOCCER:THE FIGHT to control Liverpool's future is heading for the high court next week, after the club's chairman, Martin Broughton, insisted he has the legal right to sell the club despite the opposition of Tom Hicks and George Gillett, the American owners.
Broughton and the club’s managing director, Christian Purslow, and the commercial director, Ian Ayre, said they had agreed a sale to New England Sports Ventures, owners of the Boston Red Sox baseball team, a deal that would give Hicks and Gillett nothing for their shares nor their €165 million loans back to the club.
NESV, a group of 17 investors led by the US multimillionaire John W Henry, have agreed to clear the club’s €229 million debt with the Royal Bank of Scotland, which Hicks and Gillett borrowed to buy Liverpool in the first place, and meet other liabilities of around €114 million. The proposed deal has the backing of the Premier League.
Broughton announced he has launched legal proceedings to confirm his three-man board majority has the right to conclude the sale, saying: “The owners have tried everything to prevent the deal from happening.”
Fifteen minutes before a board meeting on Tuesday called to approve the sale, Hicks and Gillett sought to replace Purslow and Ayre with Mack Hicks, Tom’s son, and his assistant Lori Kay McCutcheon. Broughton, in a series of interviews including one on Liverpool’s website, said that move and the Americans’ opposition to the sale were a “flagrant abuse” of undertakings they gave when refinancing for a third time with RBS in April.
Broughton said they agreed he, as chairman, would have the sole right to appoint and remove directors, a power written into the club’s constitution, and agreed with RBS not to obstruct “reasonable endeavours” to agree a sale. The court action is to seek approval from a judge for the sale.
“We will be seeking a declaratory judgment to say we acted within our rights,” said Broughton, the British Airways chairman who was appointed to oversee the sales process in June. “George and Tom had recognised the only way of moving forward was selling the entire club, and that if they alone said that is what they were going to do it would not have any credibility because they no longer had any credibility. They agreed to appoint an independent chairman to add credibility to the process. I was not prepared to be their patsy, adding credibility to a process that did not have it. They gave those written undertakings and on Tuesday they flagrantly abused those undertakings.”
A spokesman for Hicks said he is adamant his new Liverpool board is legal and has the authority to vote against a sale. “There were no such undertakings given to Broughton,” he said, “the board has been legally reconstituted, and the new board does not approve this proposed transaction.”
The deadline for repaying the loans to RBS, €271 million, is next Friday, October 15th. RBS said there will be no further refinancing for Hicks and Gillett, who appear liable to lose more than their €165 million if RBS place Liverpool in administration, because the bank could pursue them for the €271 million. Broughton argued it is in the Americans’ interests to accept a deal he is legally entitled to conclude.
“I think it’s rather sad,” he said of the public boardroom battle. “Their legacy . . . was never going to be good. This was the one final opportunity where they could walk away with their heads held high, saying to the fans: ‘We said we would deliver you the right owners, we have, and we did it at great personal cost.’ But they chose, effectively, to suffer the great personal cost and walk away humiliated as a result.”
NESV issued a statement last night that confirmed their bid “has been selected by the club’s board of directors” and outlined its plan “to create a long-term financially solid foundation for Liverpool FC, dedicated to ensuring that the club has the resources to build for the future, including the removal of all acquisition debt.”
The commitment is to repaying to RBS the €229 million which the US pair borrowed to buy the club, and to do so in cash, not with further debt to be loaded on to the club. The other €114 million is to cover the club’s other liabilities, including debt taken on to finance the new stadium, with which Hicks and Gillett could not proceed.
The new US investors, in a departure from club policy likely to enrage Liverpool city council and local residents’ groups, is not committing to building the new stadium, on which the neighbourhood is relying for regeneration. NESV said they may redevelop Anfield instead. Broughton said: “They haven’t yet been able to make that call because they haven’t been able to do sufficient homework to be absolutely clear on the right way forward.”
GuardianService
