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      Liverpool FC facing five October Debt Day scenarios

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      RedLFCBlood
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      Liverpool FC facing five October Debt Day scenarios
      Oct 02, 2010 11:14:30 am
      Liverpool FC facing five October Debt Day scenarios

      http://www.liverpoolecho.co.uk/everton-fc/everton-fc-news/2010/10/02/liverpool-fc-facing-five-october-debt-day-scenarios-100252-27384391/

      WITH Liverpool FC continuing to struggle on the pitch, the battle for control off it is seen by many fans as vital to a revival in fortunes.

      This month is regarded as crucial in settling the long-term ownership of the club with the expiry date for the Royal Bank of Scotlandā€™s Ā£237m loan to Liverpoolā€™s American co-owners possibly less than a fortnight away.

      The majority of fans hope an inability to pay off that loan will force Tom Hicks and George Gillett out of Anfield, allowing a new owner to take the club forward, hopefully with that crippling debt removed.

      But there is a fear Tom Hicks could even raise extra finance to take over the club on a solo basis, regardless of the sever reservations of the rest of the LFC board.

      Today, we examine the five potential scenarios which could soon unfold at Anfield. You can also vote on which of them you want to happen, and which is most likely, by clicking here.

      Some finance experts envisage that the October deadline could pass without any firm resolution about the Redsā€™ future established.

      James Dow, a partner in the northwest accountancy firm Dow Schofield Watts who has advised Barcelona and Celtic, described Liverpoolā€™s predicament as a ā€œstand-off.ā€

      And he predicted it may take many more months for the ownership to be clarified, possibly dragging the uncertainty even until summer, 2011.

      Mr Dow told the ECHO: ā€œIf Hicks can find finance, I donā€™t think any lack of support from the board will make a difference.

      ā€œBut for now, a deal isnā€™t happening as thereā€™s a stand-off going on.

      ā€œLiverpool are in a no-manā€™s land.

      ā€œBut ultimately, this could drag on and on, and not even be resolved until next summer.ā€

      Royal Bank of Scotland call in the debt

      THE Royal Bank of Scotland call in their Ā£237m debt, and effectively repossess Liverpool FC ā€“ in much the same way a bank would repossess your house if you defaulted on your mortgage.

      This, however, would likely be a temporary arrangement, with RBS maintaining the current English board structure and Hicks and Gillett removed from the picture.

      Observers speculate it would give the bank time to quickly find a more realistic buyer for the Anfield club, drastically bringing down the sale price from the lofty Ā£500m-Ā£600m currently being touted by Hicks.

      "Interested parties" are likely to "show their hand" once figures of around Ā£300m, thought to be a more realistic estimation for Liverpool, are proposed.

      The Americans would doubtless launch their own legal challenge if RBS took over running of Liverpool.

      Kop Holdings goes into administration

      ALTHOUGH unlikely, the bank could technically place Kop Holdings, Liverpool FCā€™s parent company, into administration.

      But the ECHO understands the Premier League would not view that move as Liverpool Football Club itself being declared insolvent.

      Regular discussions have been taking place between Liverpool chairman Martin Broughton and league chief executive Richard Scudamore.
      Click here to find out more!

      The Reds have been seeking clarification on what would be the potential scenario if RBS took temporary charge at Anfield.

      Sources have indicated a nine-point deduction, threatened to football clubs when they go bust like Portsmouth last season, would not materialise.

      League chiefs crucially consider the debt to rest squarely on the shoulders of Tom Hicks and George Gillett, co-chairman of the club and owners of Kop Football Holdings.

      Managing director Christian Purslow has repeatedly said that there is no prospect of Liverpool Football Club going into administration.

      Speaking last week he said: "When we sell the business the debt will be reduced or go away which will make us the most profitable club in the Premier League. Liverpool is not going bust."

      As Liverpool has proved they have steady revenues ā€“ TV rights money, ticket sales, sponsorship ā€“ the club would avoid incurring any penalty.

      Although Steve Horner, of campaign group Kop Faithful, said: "I am sure that the majority of Liverpool fans would settle for a nine-point deduction if it meant that Hicks and Gillett would never darken our door again."

      New buyer comes forward

      A BIDDER puts forward a package to buy Liverpool which is considered acceptable by the Reds board before Octoberā€™s refinancing deadline.

      With the structure of the board crucially changed during the summer, Broughton, Purslow and Ayre could now out-vote the Americans.

      The only formal offer made for Liverpool came from the Rhone Group in March when they proposed to pay Ā£110m for a 70% stake in the club, making the Americans passive shareholders.

      In many Anfield quarters it was considered a "solid" proposal to pay down a portion of the debt and make transfer funds available.

      That bid was dismissed by Hicks and Gillett, and tellingly, the make-up of the board changed after the event, allowing the English board members to effectively out-vote the owners. A proposal from Chinese mogul Kenny Huang and QSL Sports company was withdrawn in August.

      It was said to be for Ā£325m, but the ECHO understands it failed to impress the Anfield board who considered it incomplete and not supported by genuine finance, although it is hoped it may be resurrected.

      With consortiums, possibly just two currently in dialogue with Liverpool, biding their time before the club price falls, a bid before deadline remains improbable.

      The Americans themselves had lent Ā£145m to Kop Football Holdings. But at the insistence of RBS in one of the previous refinancing rounds, the Americans converted the loans into equity.

      Add the Ā£145m to the Ā£237m owed to the banks and around Ā£30m of penalty charges, and the Americans must sell for more than Ā£410m to merely break even.

      Refinancing

      ROYAL Bank of Scotland agrees to extend the refinancing deadline to give Tom Hicks time to establish new sources of funding (effectively debt).

      Liverpool FC officials view this step as the "worst possible scenario" for the club and Christian Purslow has consistently said would be opposed by the board

      This extension could be anything, starting from just a couple of weeks to allow the club to be sold to a bidder needing more time to complete due diligence before a purchase.

      It could be longer if RBS finds the prospect of taking over or forcing administration to be unpalatable or too legally complex.

      The bank, however, could potentially place caveats on any extension, for example that the Americans are forced to accept lower offers than the figures they are currently seeking.

      With the prospect of legal challenges, RBS may have little choice but to extend temporary finances.

      Hicks pays off the debt

      TOM Hicks manages to raise the appropriate funds to pay off the Royal Bank of Scotland debt and retains ownership of the club.

      The English members on Liverpoolā€™s board ā€“ managing director Christian Purslow, chairman Martin Broughton and commercial director Ian Ayre ā€“ would almost certainly lodge objections against such a move if any new debt was secured against the assets of Liverpool FC.

      They have already consulted solicitors regarding blocking a new financing package from the Texan.

      But how successful such a challenge would be remains untested as some law experts told the ECHO covering the RBS debt would give him ā€œcarte blancheā€ to rip up the existing board structure and appoint new members of his choice.

      Privately, Liverpool view Hicksā€™ attempts to persuade a private equity company to shoulder the Ā£237m arrears as highly unlikely.

      The easiest way for Hicks to retain control of the club is for him to raise the finance himself, without securing it against the clubā€™s assets.

      This has sparked fears about his intentions in creating a new investment company for which he is currently trying to attract investors.

      According to papers registered with the USAā€™s Securities and Exchange Commission, Hicks  Acquisition Company II is seeking to raise $230m (Ā£145m).

      Shares are being offered for $10 in the ā€œnewly organised blank check company formed for the  purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase,  reorganisation or similar business combination with one or more businesses.ā€

      The initial public offering papers also warn prospective investors that ā€œinvesting in our securities  involves a high degree of riskā€.

      The company is registered at the same address as Hicks Holdings ā€“ from where Hicks  conducts his business affairs.

      The underwriters for the deal are Citi Bank and Deutsche Bank Securities, with the company  expected to start trading on Thursday, October 7.











      « Last Edit: Oct 02, 2010 11:54:25 am by ayrton77, Reason: Took the \"Read More http\" bit out of topic title »
      neilh2105
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      Re: Liverpool FC facing five October Debt Day scenarios Read More http://www.live
      Reply #1: Oct 02, 2010 11:36:36 am
      "The underwriters for the deal are Citi Bank and Deutsche Bank Securities, with the company  expected to start trading on Thursday, October 7."

      Do they know something we don't
      Why launch the fund on the seventh when the RBS deadline is around that date?
      It leaves them no time at all to negotiate with RBS
      or has an extention already be agreed
      I'm getting a distinct whiff of skulduggery
      AussieRed
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      Re: Liverpool FC facing five October Debt Day scenarios Read More http://www.live
      Reply #2: Oct 02, 2010 11:42:09 am
      "The underwriters for the deal are Citi Bank and Deutsche Bank Securities, with the company  expected to start trading on Thursday, October 7."



      Does this mean our email campaign to these 2 Banks didn't work  ???
      TKIDLLTK
      • Forum Legend - Dalglish
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #3: Oct 02, 2010 01:31:01 pm
      Option 1 or 2 please :)
      RedPuppy
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #4: Oct 02, 2010 01:33:45 pm
      I DO NOT like that last sentence one bit.
      SpionKop88
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #5: Oct 02, 2010 01:39:43 pm
      Does this mean our email campaign to these 2 Banks didn't work  ???
      Looks that way mate.....:(
      MiciG91
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #6: Oct 02, 2010 02:07:24 pm
      Does this mean our email campaign to these 2 Banks didn't work  ???
      sh*t !!!!!
      carheex
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #7: Oct 02, 2010 02:19:55 pm
      Does this mean our email campaign to these 2 Banks didn't work  ???

      Did anyone (sane) seriously think that spamming a bank's email inbox would make the slightest bit of difference to their business decisions??
      KS67
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #8: Oct 02, 2010 02:39:07 pm
      Did anyone (sane) seriously think that spamming a bank's email inbox would make the slightest bit of difference to their business decisions??

      Well it was that or sit at home moaning, we chose the former.

      At least we gave it a go.
      Bpatel
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #9: Oct 02, 2010 02:40:54 pm
      Did anyone (sane) seriously think that spamming a bank's email inbox would make the slightest bit of difference to their business decisions??

      Have you read this thread at all:

      http://www.lfcreds.com/reds/index.php?topic=33094.0

      or even this one:

      http://www.lfcreds.com/reds/index.php?topic=33183.0

      If anything these e-mail campaigns are helping to get the word around about the state of the club and its current owners.
      vitez
      • Forum Legend - Fagan
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #10: Oct 02, 2010 02:46:05 pm
      Did anyone (sane) seriously think that spamming a bank's email inbox would make the slightest bit of difference to their business decisions??

      Wasn't overly convinced it would change much but even the greatest journeys start with a single step.  30 minutes of my time over the last couple of months isn't too much to give for a club I care about - you've got the attitude of a coward.
      dunlop liddell shankly
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #11: Oct 02, 2010 03:02:40 pm
      Not much to do with the story, but did anybody else realise that the link is to Everton FC's news? Didn't think the ECHO was that backward.
      tezmac
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #12: Oct 02, 2010 03:08:19 pm
      Wasn't overly convinced it would change much but even the greatest journeys start with a single step.  30 minutes of my time over the last couple of months isn't too much to give for a club I care about - you've got the attitude of a coward.
      But here lies the problem, you will never achive the end we require by emailing, you have to do somthing positive. Dont but any merchendise, boycot the games, you have to do more than give up 30 minutes of your time i am affraid.
      paulrobbo
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #13: Oct 02, 2010 03:09:00 pm
      Did anyone (sane) seriously think that spamming a bank's email inbox would make the slightest bit of difference to their business decisions??

      We weren't just spamming them. We were letting them know that if they did lend Hicks the money to pay off the debt, we would launch a media campaign against them. We were trying to pull together like a family when it was needed, as Liverpool fans do.
      vitez
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #14: Oct 02, 2010 03:20:06 pm
      But here lies the problem, you will never achive the end we require by emailing, you have to do somthing positive. Dont but any merchendise, boycot the games, you have to do more than give up 30 minutes of your time i am affraid.

      I was merely referring to the 30 minutes in regards to the emails.  Living in Australia means the boycotting games part is a given and in terms of merchandise the club won't see a penny out of me until this cancerous regime is over.  I've spread the word and informed other Reds to do the same - I ensured that my friend's missus who recently went back to Liverpool to visit her family didn't buy all the Liverpool supporters over here shirts or anything from the club shop as presents, I'm doing my part to inform people and explain why it is the case.
      LFCexiled
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #15: Oct 02, 2010 03:32:22 pm
      I go for 'Royal Bank of Scotland call in the debt' and i think this is the more likely even if his new company starts trading on the 7th and he has managed to get refinanced we have to hope that a new buyer comes in before he can be allowed to pay the money back.

      The remit of the board is to find a new owner and until that's no longer possible I will not abandon hope.
      solodee
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #16: Oct 02, 2010 03:42:49 pm
      I want a new buyer; but I think it will only happen after RBS has taken possession of the club.

      Worried about the 9 points deduction thing too.
      « Last Edit: Oct 02, 2010 05:42:08 pm by solodee »
      smigger15
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #17: Oct 02, 2010 03:58:53 pm
      Not much to do with the story, but did anybody else realise that the link is to Everton FC's news? Didn't think the ECHO was that backward.

      Yeah, I noticed that right away DLS  :-\
      RedLFCBlood
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #18: Oct 02, 2010 04:11:18 pm
      Can I take the option where RBS take control, Hicks and Gillet get arse raped an lose money then rich Abramovich type buys the club immediately starts work on the stadium within a month and throws a 100 million at the January transfer window as quality is hard to find, with a promise of a 250 million bonanza in the summer window when Rafa returns.

      If Carlsberg did perfect scenarios...they probably be the most perfect scenarios in the world.
      Brian78
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #19: Oct 02, 2010 04:15:03 pm

      Worried about the 9 points deduction thing too.

      Dont be mate the chances of that seem to be very very slim
      MishunTheRed
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #20: Oct 02, 2010 04:44:30 pm
      Are the investors in this new murky scheme of his really going to want him taking their hard-earned and using it to bail himself out of a sticky situation of his own making, with slim to no chance of them seeing a decent return on their money?

      When I saw the article in the Echo my guts dropped when I read the bit about it starting trading on the 7th but I just can't see it. Maybe I'm just being wishful and deluded.
      HUYTON RED
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #21: Oct 02, 2010 04:46:51 pm
      I want a new buyer; but I think it will only happen after RBS have taken possession of the club.

      Worried about the 9 points deduction thing too.

      The club have already done deal with FA/Premier League to avoid this because it's the holding company that will be going insolvent.
      Misty
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      Re: Liverpool FC facing five October Debt Day scenarios
      Reply #22: Oct 02, 2010 06:53:36 pm

      Im with him!
      Im not sure which of all the options is the most likely- as i want h&g out so bad my vision is blurred!
      Deadline day is fast approaching, and i cant wait to find out what the decision is!

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