According to The Independent newspaper this morning DIC are still wanting to buy Liverpool Football Club and according to the paper a deal should be concluded within 4 weeks.
Here is the article in full -
We have heard all this before and if the newspapers were to be believed then Liverpool would have been taken over weeks ago. A deal was supposed to have been imminent and a matter of days about 2 months ago and still we are no nearer to having new owners. Or are we.
At the moment The United States of America are going through a ‘credit crunch’ in that banks are refusing to lend money and this is leading to many investment firms witnessing their assets plummet in value.
A fine example would be if you had a £100,000 investment then it would probably currently be worth about £60-70,000.
What this means is if you have an investment which is currently valued at more then you purchased it for and you have an interested buyer who is willing to pay over the odds then in the current climate you would be foolish not to take them up on this offer as the ‘pinch’ in America is showing no signs of getting better.
Tom Hicks recently announced he was breaking off talks with DIC regards the take over of the club and used his power to veto a deal for his business partner, George Gillett, to sell his shares.
The reason for this is Mr Hicks knows that as soon as DIC purchased 50% of the club then they can force the American out via the power of the board and DIC themselves vetoing any potential plans Tom Hicks may have had for the club.
Tom Hicks has already been advised by JP Morgan (a very large investment bank in America) to accept DIC’s offer as the long term outlook for being able to make a substantial amount of money from Liverpool is bleak under the current circumstances.
Mr Hicks may well have thought he could get through the ‘credit crunch’ but when you have a company like Bear Stearns, one of Americas largest investment banks in crisis then Tom Hicks has to seriously consider his options and that best one if to sell Liverpool FC whilst he can.
What if he doesn’t sell Liverpool? Well the repercussions of that are that Tom Hicks has to initially ‘buyout’ his partner George Gillett. That will cost in the region of £200 million which Hicks just doesnt have and no-one, especially from America is willing to invest that sort of money at the moment.
If Tom Hicks does manage to get the £200 million to buy George Gilletts shares then the next step to start generating money from Liverpool is to build the new stadium. This is going to cost around £300 million to build and is the most important factor in whoever ‘owns’ Liverpool FC in making some serious money.
This is where teams such as Manchester United are miles ahead of Liverpool in that they can attract nearly 30,000 people every home game through the turnstiles.
The problem here for Tom Hicks is the price tag of £300 million to build the ‘New Anfield’. This can be offset by getting a loan which is paid for by future profits like what Arsenal have done but once again most banks are not prepared to lend anyone a large amount of money as that and especially to someone as high risk as Tom Hicks.
The clock is ticking now for the Texan. Does he accept DIC’s bid of £400 million for the club or does he get a new business partner who is prepared to bankroll everything but have little say.
The longer Tom Hicks leaves it then the lower the price will be that DIC will offer due to the fact earlier next year Hicks and Gillett are going to have to re-finance their loans again and the banks will not be willing to lend them the money therefore DIC can offer them far less knowing they are not in a position to refuse.
I don’t think we will be having a media frenzy like we did a couple of weeks ago when a new story was leaked every day but take my word for it there is still plenty happening at Liverpool but it seems to be conducted in the Liverpool way which is keeping it behind closed doors.
