Liverpool owners reach finance agreement

Mon, 27 Jul 23:18:07 2009

Liverpool's American owners have concluded a deal re-finance the bank loan they took out to buy the club in 2007.

Co-owners Tom Hicks and George Gillett are not expected to issue a statement, but the deal is believed to be for another year and will involve them paying back £60m of the original debt. Negotiations between the Royal Bank of Scotland, Wachovia and the owners have continued for months the worldwide credit crunch has made them tortuous.

There has been real fear that the banks would call in the loan, while both Hicks and Gillett have searched for someone to take a minority stake in the club for around £100m to no avail. But a source close to the owners has confirmed that the deal has now been concluded, and before last weekend's deadline for re-financing the package expired.

The owners have reduced the £290m they owed to £230m, with £60m being repaid, half immediately.

Hicks, 63, and Gillett, 70, purchased Liverpool in 2007 for £174m, taking on £44.8m of liabilities.

At the time they maintained that financing the debt would not fall on the club. But that attitude changed, and Liverpool now have to find around £40m a year to service the debt, a situation that has enraged fans' groups and impacted on boss Rafael Benitez's transfer budget.

The owners have also failed to find the money to build the club's new stadium with preliminary work on the Stanley Park venture halting during last season. Extra cash for the stadium "did not form part of any discussions" claimed the source, although there is still a projected date for completion of 2012.

Rogan Taylor, spokesman for the ShareLiverpool group who re-launched their own takeover plans last week for, in effect, a fans' co-operative, said: "The deal we are hearing about for the re-financing of the Americans' loans is really what we expected.

"These are the indications we have had from RBS for a while, I would be interested to know really what Wachovia's view is. It has been rumoured that they were very unsure about this new deal.

"It is little more than an expensive fix - just sticking plaster and making things more difficult for the club to progress in the long run."

 

Comment 1 - 5 of 5

Sort comments by: Most recent

  1. I have no money for LFC share buying but I pray the­ fans share pool or what ever name it is manage to put­ together enough dosh to tempt the two owners and lets­ be rid of them for good, they are a pair of flops, and­ the way they bought it with hardly any of their own­ money should be seen as fraudulent, it wont be, but it­ should be!
    A KOP FAN

    From RAYMOND, on Sat 1 Aug 1:49

  2. I hate these yanks!

    From damnsoldja, on Wed 29 Jul 2:14

  3. i dont know how big business works but surely­ liverpool, man u or any other british team should not­ be accountable for owners personal debts

    From david, on Tue 28 Jul 15:36

  4. Why does it feel that these guys get more financial­ issues with there banks than other owners of clubs that­ have borrowed substantial amounts of cash, is it that­ they are not established business people as the others?

    From amyperrett, on Tue 28 Jul 3:08

  5. ....but we the fans will soon buy our darling club out­ from this dilemma. All what you yanks are doing is your­ cup of tea

    From Michael, on Tue 28 Jul 3:03
Sort comments by: Most recent

Not already a Yahoo! user ? to get a free Yahoo! Account