Friday, June 05, 2009

Europe Holds Key As Liverpool's Worried Owners Juggle With Figures

More than any ordinary business — and we know that football is not that — the “going concern” question is a sensitive one for top European clubs.

For Liverpool, it is vital not only to their future as a solvent company but also their continued participation in the Champions League, on which they rely increasingly for the income to service their burgeoning debt.

It is a delicate situation. Uefa, which runs the Champions League, demands that clubs provide detailed financial forecasts before it will issue them with a licence to compete in its competitions.

But, despite worrying levels of debt and the caveat from their auditor at KPMG about their ability to remain solvent, George Gillett Jr and Tom Hicks, the co-owners, must have done enough to convince Uefa that Liverpool will not go bankrupt halfway through next season or the club would already have been thrown out of Europe.

Given the continued reluctance of banks to lend money in the recession, the language of Liverpool’s accountants is not wholly unexpected. Auditors are required by financial regulators to make their assessments about whether a company is a going concern on the assumption that it can stay in business for the next 12 months. Increasingly, confidence in that assumption is low.

Yet the fact that a £350 million credit facility secured by Kop Football (Holdings) Ltd, the club’s holding company, is due for repayment on July 24 is undeniable. So, too, is the lack of a replacement arrangement with RBS and Wachovia, despite the insistence of the owners that there will be one in the coming weeks.

So KPMG has a duty to highlight the “material uncertainty which may cast significant doubt on the company’s ability to continue as a going concern”. Experts say this constitutes a special alert for shareholders — or, in this case, supporters. It is essentially code for “you should be worried about this”.

What is worrying for Liverpool is a basic admission that the club are not generating enough income to cover interest payments totalling £36.5 million and the ambition to attract the biggest — and most expensive — players to Anfield. Staff costs in the 2007-08 season were nearly £90 million.

Even if Gillett and Hicks do successfully renegotiate the soon-to-expire credit facility, there remains the question about their long-term ability to take losses that at the last count were £42.6 million.

There will be continued pressure on the owners’ American sports businesses to prop up Liverpool’s financial house of cards if the credit crunch continues to equal crippling lending terms.

It surely has not helped that they made a dud call on the direction of interest rates, entering into fixed agreements between 4.3 per cent and 6 per cent as the Bank of England cut its rate to a record low of 0.5 per cent. The cost of exiting these hedging agreements would total £30.6 million, prompting KPMG to describe them as “potentially onerous contracts”.

The bottom line is, when they add it all up, will they reckon it is worth it?

Barcelona Moot Abidal Swap With Liverpool For Mascherano

Barcelona have reportedly continued their chase for Liverpool’s midfield hardman, Javier Mascherano.

The treble winners have been linked with a move for the Argentina captain since before the season ended, and it is now believed that they could use French defender Eric Abidal to tempt the Merseysiders to part company with their star midfielder.

According to Sport, Reds manager Rafael Benitez is keen to bolster his defence, particularly at left-back, and Abidal is a player who fits perfectly into the Spanish gaffer’s plans.

The Barcelona-based paper believes that the Blaugrana valuate the Frenchman at around €15 million - the same amount they purchased him for from Lyon back in 2007 - and would include the 29-year-old in a player-plus-cash deal to sign Mascherano.

Juventus have also reportedly shown interest in Abidal, but the conundrum for Barca coach Pep Guardiola is that with veteran left-back Sylvinho set to leave the Camp Nou in a few weeks’ time, Abidal’s departure would force the club to look for two new defenders to occupy the left flank.

Liverpool Would Miss Xabi Alonso If He Joins Real Madrid

Liverpool defender, Alvaro Arbeloa is aware that compatriot, Xabi Alonso could very well be on his way to his old club Real Madrid this summer.

The return of Florentino Perez to the ‘White House’ as club president has ushered in another era of big money, high profile signings at the Spanish capital but Arbeloa does not believe that it is necessarily a bad thing.

“Florentino’s return to Madrid is excellent news for all things madridismo and for football in general,” he told La Sexta while back in Spain with the national team.

When asked about Alonso, who continues to be a prime target for Los Blancos, Arbeloa assessed, “Xabi Alonso has been one of Liverpool’s best players, certainly the most consistent.

“He is our key player and he makes us play well. He has improved a lot defensively and he’s much more aggressive. We will miss him a lot if he joins Madrid,” he added.

As for his own future, though, Arbeloa assured that he has no intentions of leaving Anfield.

“At the moment I am very happy in England and I hope to continue here.”

Recent transfer speculation suggests that Madrid have already launched a €23 million bid for Alonso, while there are also reports that Liverpool are demanding no less than €40 million for the 27-year-old.

Sylvain Distin To Replace Sami Hyypia At Liverpool

Liverpool have begun their summer recruitment early this season as they have tested Portsmouth's resolve by offering £2 million for French centre half Sylvain Distin, 31, according to a report in The Times.

Distin, formerly of Manchester City, is wanted by Reds boss Rafael Benitez so that he can fill the void left by departed defender Sami Hyypia, who has joined Bundesliga outfit Bayer Leverkusen in search of regular first team football.

Distin has one year left to run on his deal at the south coast club, and the management of Pompey may be keen to sell the player, whose future is considered ambiguous.

Benitez is believed to be a keen admirer of Distin, despite his underwhelming form last season. Prior to the current campaign, he had built a solid partnership with former Arsenal and Tottenham Hotspur defender Sol Campbell.

Out-of-work Italian tactician Roberto Mancini and sacked Mexico coach Sven-Goran Eriksson, are expected to be the two front-running candidates for the vacant Portsmouth managerial job.

Liverpool Defender Andrea Dossena Wants ‘New Life’ At Juventus

Andrea Dossena moved to Liverpool from Udinese last summer, but he has failed to adapt to the Premier League and hopes that Serie A giants Juventus will hand him a lifeline.

“I have talked to [Rafael] Benitez. He is a wonderful person and has understood my problem,” Dossena explained in Tuttosport.

“He told me that if they receive an offer that satisfies both the club and me, he will facilitate my transfer. I would run to Juve. They showed interest in me last year, but then Liverpool stepped in and wrapped things up in less than an hour.”

The 27-year-old has found his first team opportunities limited at Anfield and revealed that he has struggled to come to terms with the Reds’ training methods.

“In England they play continuously and the hardest training session does not last more than 40 minutes, but I need to train longer,” he explained.

“Now I truly hope to join Juve and start a new life.”

Liverpool paid €11 million for his services, however, the Old Lady are confident that a €7m bid will be enough to lure him to the Stadio Olimpico.

Manchester City Ready To Swoop On Liverpool's Xabi Alonso

Manchester City are ready to take advantage of an Anfield feud to snatch midfielder Xabi Alonso.

Alonso has had an icy relationship with fellow Spaniard Rafa Benitez, ever since Liverpool boss Benitez tried to sell him last summer.

Now, the Mirror can reveal that Alonso heads the list of players wanted by the super-rich Manchester club, and manager Mark Hughes even placed him ahead of Gareth Barry as a target.

The City boss wants the pair to form the fulcrum of his midfield, and he is ready to capitalise on a breakdown of the relationship between Alonso and his boss to try to tempt him with a £20million bid.

Alonso lost faith in Benitez when he tried to sell him behind his back last summer, and when it seemed the same would happen at the end of this season, he resolved to find himself another club.

There has already been contact from Real Madrid, and while – contrary to reports – there has yet to be a concrete bid from the Bernabeu, it seems certain they will follow up interest with an offer in the region of £18m.

But the politics at Anfield will prevent a swift conclusion to any deal, and that will allow City the chance to tempt Alonso with a massive deal.

After Benitez was heavily criticised for trying to sell Alonso last summer, the player has been his most consistent performer.

And the Anfield boss knows he would look bad if he blithely went ahead with a sale. Instead, canny Benitez wants Alonso to ask for a move, absolving him of all blame from the fans for the loss of such a popular player, but the midfielder is reluctant to do that, because he feels he has been forced out.

Alonso’s first choice would still be a move back to Spain with either Madrid or Barcelona, who are also monitoring the situation, but City have the financial clout to make him think again.

They gave Barry a staggering contract worth almost £100,000 a week, and given their desire to land Alonso, they would be prepared to top anything Real could offer.

He and his family are happy in the north west of England, and until the end of the season he wanted to remain at Anfield, before tiring of the Kop politics.

Signing for City would allow him to stay where he is settled, and would also offer the huge incentive of a deal that could be worth in the region of an amazing £30m.

His departure though, will leave Benitez in a difficult situation. The Liverpool boss was caught napping by City over Barry, and he has no obvious alternative as a replacement for Alonso.

Benitez will have in the region of £50m to spend if he sells Alonso. He wants Valencia winger David Silva, and the rest of that figure will have to be diverted to a replacement in midfield, leaving little for a striker or the two defenders that are also on his wish-list.

Liverpool Set To Lose Out Again With David Silva's Wares Wanted At The Bernabeu

Liverpool are in danger of missing out on another summer signing after David Silva’s representatives held talks with Real Madrid last night.

Rafael Benítez had identified the midfield player as capable of bringing more flair to Liverpool’s attacking play, but he may have to turn his attentions elsewhere.

The Merseyside club lost out on Gareth Barry, who moved from Aston Villa to Manchester City for £12 million this week.

Real have a transfer budget thought to be as much as £200 million to sign about five players this summer and they believe that Silva will cost little more than the £20 million that Juventus offered last summer.

Valencia will be forced to sell players because of the poor financial position that led to the resignation of Vicente Soriano, the club’s president, yesterday.

Julio Llorente and Amadeo Rangel, Silva’s agents, met Miguel Pardeza, Real’s sporting director, and Jorge Valdano, their director general, for 1½ hours at the Bernabeu yesterday.

Anfield Icon Robbie Fowler Would Love To Manage Liverpool

Former England international Robbie Fowler, 34, currently of the North Queensland Fury in Australia's A-League, has u-turned on his previous ambitions of making an early retirement from football and has now declared that he would relish entering a career in coaching and management.

Furthermore, a job as boss of his former club Liverpool would be something that he would relish.

"Anyone who says they don't want to manage Liverpool is lying - it's a massive club," Fowler today told the club's official website. "Personally, I always said I'd pack in young and take a break, but the older I've become, the more I've looked into coaching or managing.

"I probably will go down that route. It's a tall order, and I'm not going to say I'll go on to manage Liverpool, but you know."

Fowler is regarded as an idol at Anfield, where he has even been given the moniker of ‘God’ due to his goal return of 183 from 369 games during his two spells at Liverpool.

The net-bulging forward is also credited with scoring the fastest Premier League hat-trick in history. On August 28, 1994, Fowler stuck three past Arsenal in the space of four minutes and 33 seconds.