Former Liverpool FC owner Tom Hicks claims he had 10 bidders keen to invest in club
OUSTED former Liverpool FC owner Tom Hicks has claimed he had 10 new bidders keen to invest in the club.
The Texan’s lawyers told a court he had secured interest from US hedge funds which he was hoping to take forward after repeatedly failing to meet Royal Bank of Scotland deadlines to pay back £237m of debt.
Mr Hicks and fellow former owner George Gillett have outlined a series of claims that Liverpool was forcibly wrenched from their grasp by RBS and the Reds’ English directors – then-club chairman Sir Martin Broughton, Christian Purslow and Ian Ayre.
The club was eventually sold for £300m, which the Americans say was far below its true value.
In the high court yesterday Clyde and Co, representing Mr Hicks, alleged:
Hedge fund Mill Financial was prepared to offer up to £385m for Liverpool, £85m more than its eventual sale price to Boston-based New England Sports Ventures.
The English directors thought a bid from Meriton Incubator, a vehicle for the Singaporean billionaire Peter Lim, was vastly superior to NESV’s.
Sir Martin deliberately scuppered Mr Hicks’s refinancing proposal from Blackstone GSO Capital in September 2010 by “taking the extraordinary step of leaking its details to the press as a way of preventing it coming to fruition”.
Clyde and Co produced an email from Liverpool’s current managing director Mr Ayre to Sir Martin, Mr Purslow and financial director Ian Nash apparently debating how they could legitimately rebuff a superior offer from Blackstone GSO Capital in favour of an “inferior” bid from Capital NESV.
It read: “Surely our main issue is how we legally turn down Hicks – justify taking a deal that offers, I suspect, a lower value, keeps £150m of debt and no actual guarantee of stadium.”
In strongly worded submissions to the Royal Courts of Justice in London, Mr Hicks’s legal team said: “The English directors’ brief from RBS appears to have been to secure the sale of the assets as quickly as possible.
“The English directors and RBS deliberately blocked the former owners from obtaining a refinance.
“Refinance was available and RBS could have been repaid in full, but did not want that to happen.
“They were so fixed on their objective of severing all links between the club and the former owners that a commercial approach was not followed.”
Mr Hicks and Mr Gillett also allege Sir Martin failed to disclose to them he was told by RBS it would not place the club into administration if it was not paid by October 15, 2010.
The court was also shown an email from Sir Martin to Mr Hicks and Mr Gillett on September 16, 2010, which appeared to demonstrate his preference to how the sale should proceed.
It read: “I thought I had made it clear that while the proposal you put forward, i.e. ‘Hicks in control, Hicks refinances, everything is rosy’, was a complete non-starter.
“The same economic effect could be achieved by a different but credible proposal, i.e. ‘Blackstone buys, owners out, debt reduced, stadium on way’.”
Clyde and Co said Mill Financial was told by RBS that Liverpool’s £237m debt was not for sale, leading to the hedge fund trying to buy the club rather than paying off the bank.
Clyde and Co said: “The refusal of a lender to contemplate a refinance in which it would be paid off is extraordinary.
“The conduct of RBS shows the degree to which what had occurred had departed from the norm.
“RBS was not just interested as a lender, but apparently had its own agenda.”
Further correspondence was put before the court including a message from Pete Edelman, RBS’ observer on the board of Kop Football, Kop Holdings and Liverpool FC, instructing Barclays Capital it should, “go back to all possible parties... and say that there is no reserve price and there is a deadline of say two weeks and we will sell then (explicitly or implicitly – at almost any price).”
Mr Hicks alleged Sir Martin held a meeting with NESV on October 4, 2010, informing John Henry he was the outside bidder, but only narrowly, giving him a “steer” as to the level of bid needed. That led to a revised offer the next day, which was £4m higher than Meriton’s proposed deal.
More details emerged yesterday of Mr Hicks’ account of Mill Financial’s movements.
The court was told by his legal team: “Mill Financial was appalled to discover what had occurred. Mill had a scheduled meeting with Sir Martin on October 7 to discuss its bid, which was then cancelled.
“The English director did not go back to Mill and inform it there was a new higher bid and invite it to revise its bid.
“On October 13, in increasing desperation, Mill submitted a revised offer to beat any other offer by £10m, up to a ceiling of £385m, and to provide £50m for player transfers and to continue its earlier offer to provide £100m towards to the new stadium.
“Later the same day, Mill increased its £10m premium to £20m.
“By then it was too late.”
http://www.liverpoolecho.co.uk/liverpool-fc/liverpool-fc-news/2012/03/09/former-liverpool-fc-owner-tom-hicks-claims-he-had-10-bidders-keen-to-invest-in-club-100252-30493782/They turned down potentially better bids - ones that may have cleared our debt - all to ensure the Broughton-led sale to FSG went through. Highly suspicious - no?
And one of the (much) better bids was Huang's CIC-backed bid. Which mysteriously leaked onto the front pages, forcing the Chinese to back out as their confidence had been abused. I wonder who leaked that and why?
As great as it was to get rid of the cowboys - this whole sale smells very funny and does not look like it was the best deal at the time for the club.
