Liverpool takeover financed by 298m loans, but it’s all OK
The news that Hicks and Gillett have taken loans to finance Liverpool’s takeover should not come as any surprise.
They are smart, aggressive businessmen and they have taken a long-term view on Liverpool as a valuable investment.
The ‘offer document’ circulated to shareholders states that the Americans have taken a 298m loan from Bank of Scotland on a 7.24% interest rate, which means that Liverpool will be required to pay around 21m in interest payments each year. This amount covers the takeover as well as extra funds to absorb Liverpool’s debt and provide for future expenses.
A further 200m may be taken to further finance the stadium at Stanley Park.
Should Liverpool fans be worried? Nope, this sort of deal is nothing new in football. Liverpool’s loan has been taken on Hicks’ and Gillett’s ‘personal guarantee’, as opposed to on future earnings (in Arsenal’s case) or club assets (in United’s case).
More on the Liverpool takeover:
- Mihir Bose on the real deal behind DIB’s failed takeover
- Chief Exec Parry makes 500k out of the deal
- David Conn on the organisational details behind the Liverpool takeover
Topics: Liverpool
Football News 24/7
It has been anounced on radio city that liverpool have applied for planning permission to increase the capacity of the new proposed stadium to 80 000. Imagine how loud that would be?
March 14th, 2007 @ 17:29Andrew – that would be fkn amazing. When will the stadium at Stanley Park be complete though?
United are planning an expansion to 90k – I think clubs like Pool, United and Arsenal can easily keep 70k+ stadiums filled, and it’s a good step in the right direction for Pool (if what you’re saying is true – a news link would help
).
March 14th, 2007 @ 17:39I got it from the newsnow site,.(not sure how reliable the source is but would love it to be true). Typical, we try and get it to 80 000 to match you mancs and you move the goal posts againand stick another bloody tier on it! At that rate old trafford will be visible from the moon!
dont quote me on this but i think itl be ready in 3 years. anyone else know or can confirm this?
March 14th, 2007 @ 17:44Thats origional. well done.
March 15th, 2007 @ 00:27it’ll be ready in a year if the scousers don’t steel from the site!
March 14th, 2007 @ 19:47Andrew’s right, work has stopped on the new stadium so that Gillett & Hick can look at re-submitting plans for an 80,000 seater. It is meant to be open for the 2009 season but I would be amazed if that happens so quickly. Also the loan is a personal one so the interest will not be paid by LFC (unlike the Glazer’s), although their wages/dividends will come from the club so it is in a round-about way.
As much as I sit on the fence about the Glazer’s because despite everything they are businessmen so it’s not in their interest to take United under, it would be nice to see them be public and supportive of the club and fans (although a bit late now) like the YankeeScousers are.
March 15th, 2007 @ 18:54Simon –
1) Gillett and Hick have had the opportunity to learn from Glazers’ experiences
2) The personal / club assets / future earnings distinction is a semantic one – at the end the owners have to pay, and since they own the club AND they are paying interest on the club’s purchase, the club will be responsible for it.
3) Glazer’s did try to be supportive, but the sheer vitriol from fans (the media did an excellent job portraying the Glazers as grubby, greedy Yanks) meant they were mobbed wherever they went.
Things have changed now, fans are more receptive to takeovers.
4) Also, Liverpool needed the money, United was doing fine on its own. I think THAT has led to G & H being accepted more, and that in turn means they have the opportunity and room to charm the fans.
March 15th, 2007 @ 19:03I think the United fans would have been more supportive of the Glazers had it not been for the bitterness (and lack of trust) of the previous few years regarding shareholders – ie. The Coolmore guys and the fact that I think SU were hoping for a major shareholder to back them to avoid the takeover.
Takeover’s in principal are fine, but we all hope that a “fan” is the buyer and at least Gillet & Hicks are showing up and claiming to be fans.
Ahmed; I would point out that Ken Bates turns up at Leeds even though he’s disliked, and Alan Sugar always turned up at Spurs even when he was hated, Freddie Shepherd so on and so on…..if any of those have or had success all is forgotten.
Imagine had the Glazers turned up week in and out since they took over even through all the hatred, come the end of this season all would be forgotten as “they would have brought us that glory” (hopefully).
March 15th, 2007 @ 19:13I dont think the hatred against Bates or Freddie is so much that they get lynched.
You do have a point though – the Glazers could have done more.
But would you prefer a horse & pony show with business men pretending to be fans or businessmen who stay in the board room and let familiar faces run the show?
I don’t like being lied to, but fans did deserve more from the Glazers (just as the Glazers deserved better from the fans).
March 15th, 2007 @ 19:17Alex, well done for spotting the mistype. do you want a medal? Also i think you find that the debt is not liverpools, however we have to pay the interest on the loan. Most of our fans are ok with the takeover and the way it happened. Unlike utd.
March 15th, 2007 @ 19:23I don’t like being lied to either, but those familiar faces are people like David Gill.
Only one man in the world lies more than him and that’s Cuddly Peter Kenyon.
People seem to accept that Abramovich is now a Chelsea fan even though it was laughable at the start, and no doubt people will accept that Gillet & Hick are Liverpool fans in a few years time, all i’m saying is had the Glazers weathered the storm we might accept them now instead of all the infighting, which at the end of the day isn’ healthy for the club/fans.
I feel that there are two types of United fans at the mo, those that didn’t support the Glazers but now give them the benefit of the doubt and those that didn’t support the Glazers and still don’t, but it has created an in-fighting atmosphere that the Glazers could have nipped in the bud with a bit more public support for the club/franchise.
March 15th, 2007 @ 19:25Whereas, ALL Liverpool fans are behind these two and ALL chelsea fans are behind Abramovich.
Alex- it’s STEAL, not steel.
March 15th, 2007 @ 19:33Whereas, ALL Liverpool fans are behind these two and ALL chelsea fans are behind Abramovich.
If Mourinho leaves, Abramovich will have issues. Mourinho has already divided fans over Abramovich actually, so you’re a bit off.
G & H are new.
Glazers – well, I’ll take the title over them being loved
March 15th, 2007 @ 19:35why thanks Andrew, and Old Trafford will be 100000 seater stadium by the time fergie leaves, that was his goal when he arrived at the club! I hope the fact you have american owners and a loan will put an end to some of your football teams rediculous chants regarding USA, then again I don’t think Liverpool borrowed the money, the fans probaly stole it for ya! mug
March 15th, 2007 @ 18:50also its ‘original’
March 15th, 2007 @ 18:51Ahmed- Hicks and gillet may be new but loking at ways to further increase capacity and saying that they want to build the best in the world can only help endear them to liverpools fans and is a great start in the right direction. we have every reason to positive and optimistic!
March 17th, 2007 @ 13:46If we are going to build a new stadium lets do it right and build an 80,000 seater stadium
April 14th, 2007 @ 02:51Hindsight is an invaluable commodity!!!
May 23rd, 2010 @ 10:17