Taxpayer Could Take Over Liverpool

Liverpool are two months from becoming majority-owned by the taxpayer, which, the Observer can reveal, has become the likeliest outcome if a sale has not neared completion in that time.

The Royal Bank of Scotland's main £237m loan to the club expires on 6 October and must either be repaid or rolled over. Additional sums owing to RBS are believed to have increased the club's total debt to the bank to £325m. Liverpool's company secretary, Ian Silvester, said: "From what I understand, and that's all I can say, the urgency is there due to the pressure from the banks, so I would anticipate that something will be happening within the next four to six weeks or so."

One option open to RBS would be to put the club's parent company, Kop Football (Holdings), into administration, but that is not favoured since it would almost inevitably lead to a nine-point deduction under Premier League insolvency rules. Instead, the Observer has learned, unless one of the parties involved in negotiations to take over at Anfield follows through with a formal offer, RBS's corporate-restructuring team would assume control of Liverpool and run the club as a wholly owned subsidiary. That would effectively put the five-times European champions in the hands of the taxpayer who, through the government-owned UK Financial Investments Ltd, holds 84.42% of the issued share capital in RBS.

When the loans last required refinancing in April Martin Broughton was installed by RBS as club chairman. This is said to have been due to the inability of the current shareholders, Tom Hicks and George Gillett, to provide the necessary personal guarantees to the bank. But those close to the situation say RBS's patience has now reached breaking point. In the absence of a takeover or fresh funding from the Americans the bank will be entitled to oust Hicks and Gillett from the board of Kop Football (Holdings), a step the bank is believed to be ready to take in October.

"One or two in the bank are getting twitchy about getting their money back at all," a source said. "And they are incredibly nervous about the current bids. They don't regard anything as particularly serious at the moment."

Those said to be keen on bidding include the Chinese Kenny Huang, the Syrian Yahya Kirdi, the Kuwaiti Kharafi Group, the US private-equity firm Rhône Group and, reportedly, now the Indian conglomerate Sahara.

RBS's prerequisite in the sale process is for repayment in full, though none of the bidders has yet provided proof of funds. This is highly significant since formal due diligence cannot therefore proceed, despite pledges from several consortiums to build a new stadium and invest in the team.

That is when buyers would look for the first time over player contracts, planning applications surrounding the stadium and a host of other legal issues that could potentially throw up obstacles to a takeover. Due diligence can take weeks, so the chance of a takeover before the closure of the transfer window on 31 August is remote. There is also a growing possibility that the 6 October deadline will not be met.

In an effort to bring greater order to the chaos around Anfield, Broughton has issued a request for all parties to demonstrate their funding by the end of the coming week. There were indications yesterday from Huang's camp that he will show he is capable of financing a bid. However, for the first time there was an admission that any cash he has raised will not derive from China's sovereign‑wealth fund, the China Investment Corporation. That development raises issues over the credibility of Huang's bid, since those inside the sale process had previously been informed by his camp that CIC was involved.

Broughton will seek this week to apply similar pressure to Kirdi, whose consortium's credibility has been called into question by those involved in the sale process. If neither Huang nor Kirdi can meet Broughton's terms by next weekend, Liverpool will have no further contact with them.

That would leave only two, possibly three, bidders at the table. And without one of Rhône, Kharafi or Sahara proceeding over the next nine weeks to a stage where a takeover is almost a foregone conclusion, the prospect that Liverpool becomes effectively a state‑owned enterprise rises.

Dirk Kuyt Pledges Future To Liverpool, Ending Inter Milan Speculation

Dirk Kuyt has pledged his future to Liverpool, ending speculation over his future.

Inter Milan had targeted the Dutchman, looking to use the money from the expected sale of Maicon and Mario Balotelli to snap up the Liverpool midfielder.

But Kuyt, who scored 11 goals for Liverpool last season, committed his future to the Anfield outfit after a meeting with new Reds boss Roy Hodgson.

His current contract with Liverpool is up at the end of the 2011/2012 season, but he is now expected to sign an extension.

Liverpool Aim To Bring Peter Crouch Back To Anfield

Roy Hodgson the Liverpool manager, has identified Peter Crouch as his preferred attacking reinforcement as he looks to boost his resources.

Hodgson, who has spent just £3.9 million on Danny Wilson, Milan Jovanovic, Jonjo Shelvey and Joe Cole this summer, is thought to want at least three more signings before the August transfer window closes, including a left-back, a midfielder and a forward.

The Danish international Christian Poulsen is expected to arrive in a £4 million deal from Juventus this week after his agent held talks with the Premier League club on Friday, while Paul Konchesky, Hodgson's former charge at Fulham, remains his prime target for a full-back slot.

The Liverpool manager, though, knows he needs to provide Fernando Torres with both a support act and a substitute to prevent the Spanish international, who last week committed his future to the club, succumbing to another injury-blighted season.

Though Hodgson is believed to be examining a number of possibilities, Liverpool's need to boost their quota of English players has led him to consider offering Tottenham's Crouch a return to Anfield. The striker joined the club in 2006, but was sold to Portsmouth by former manager Rafael Benítez two years later.

Liverpool cannot offer Crouch the Champions League football he would enjoy at White Hart Lane, but Hodgson believes he could convince the England international to rejoin the Merseyside club.

No formal bid will be made until funds are generated by finalizing the sale of Javier Mascherano to Inter Milan, where he will be reunited with Benítez. The Italian side has not yet made Liverpool a firm offer but that deal is expected to be completed in short order when the Italian champions sell Mario Balotelli to Manchester City.

Rafa Benitez Confident He'll Seal £20m Deal For Javier Mascherano This Week

Inter Milan boss Rafa Benitez is confident he will soon seal a £20-million deal for Liverpool midfielder Javier Mascherano.

Inter sources have told the People they wish to complete the move this week and that Benitez has asked president Massimo Moratti to reduce the asking price for Real Madrid bound right-back Maicon to free up the funds to land Mascherano.

Inter recently rejected a £21.6 million offer for the Brazilian.

Liverpool boss Roy Hodgson is said to be closing in on Mascherano's replacement, Juventus midfielder Christian Poulsen, paving the way for the Argentine's departure.

Benitez has spoken with Mascherano's agent, Walter Tamer, and offered his client a contract.

And according to the Inter sources, the Treble winners will table a formal bid to the Liverpool board in the next few days.

Liverpool Leading Chase To Sign Manchester City Midfelder Shaun Wright-Phillips

Liverpool seems to be beating Arsenal in the race to sign Manchester City winger Shaun Wright-Phillips, according to the Mirror.

Wright-Phillips is believed to have been told he can leave the City of Manchester stadium for a fee of around £7 million.

However Arsenal are thought to be unwilling to pay the £65,000-a-week wages he earns and now this has opened the door for Liverpool boss Roy Hodgson to make his move.

Hodgson is confident of signing Wright- Phillips after already persuading his former Chelsea team mate Joe Cole to join the Merseyside club ahead of the Emirates.

Wright-Phillips has already turned down City’s offer of a £10,000-a-week wage increase he was offered at the end of last season and his place has recently come under threat since the arrival of David Silva from Valencia and the imminent arrival of James Milner from Aston Villa.

Liverpool Co-Owners Tom Hicks And George Gillett Favour £600 Million Syrian Bid For Club

Liverpool owners Tom Hicks and George Gillett are ready to become unlikely boardroom allies in a bid to sell the club to Syrian businessman Yahya Kirdi.

According to The Sunday Mirror, the two Americans are ready to join forces to back Kirdi's £600 million plan to take over at Anfield.

Hicks and Gillett have had a tense relationship since they took over the club back in 2007, resulting in a breakdown in communications and the pair refusing to discuss the future of the club with one another.

However, they had been forced into a reconciliation following a bid from Chinese businessman Kenneth Huang which would see his Sportscorp China Ltd group purchase the club and its reported £237 million debts, leaving the current owners with a small profit.

Huang's bid to buy the club has been approved by chairman Martin Broughton, managing director Christian Purslow and director Ian Ayre.

The trio are in a position to win a majority vote in favour of selling the club to Huang, with the two Americans facing the prospect of launching a court battle if they are to stop the sale of Liverpool against their wishes.

That scenario now seems very likely considering the pair's wish to sell to Kirdi, and a source close to the Americans said: "Liverpool will not be sold unless the deal is acceptable to the current owners.

"Their valuation of the club remains unchanged and it is ludicrous to think that any bid will be accepted that doesn't meet this criteria, regardless of the make-up of the boardroom."

Manchester City Have The Money But Liverpool Have The Class In Fernando Torres

First, the second week of July, which saw Manchester City finalizing a £24 million deal for David Silva, the lavishly gifted Spanish playmaker as Liverpool considered making an offer for Luke Young, the 31-year-old full-back deemed surplus to requirements at Aston Villa.

That Young, erstwhile of Charlton and, in their darker moments, of England, felt that Liverpool could not pay him enough simply added to the impression that the old empire could not cope in the face of the new world order. This would be the summer, it seemed, when City were confirmed as the coming men, and Liverpool condemned as the faded force

Vulgar though it may be, it all came down to money. Not greed, as is so lazily assumed, but access to funds. Silva's involvement, indeed, is apt: a year ago, he would have moved to Anfield, but Valencia, his previous employers, tried to prompt an auction Rafael Benítez could not afford to enter.

There were no such worries for City, of course; £24 million is just a quarter of their summer spending so far. Where Valencia proved truculent, hoping to elicit more money from Liverpool, a year ago, City simply blew all others out of the water. The two sides' relative places in the firmament were set.

Or they were, at least, until Sunday night. That was when the summer's narrative changed, as news first broke of Kenny Huang's interest in buying Liverpool.

It was followed by a miasma of information so contradictory that it is impossible to say what the outcome will be, but one thing all parties seem to agree on is that this, after three long, debt-ridden years, after seeing around £170 million paid to the Royal Bank of Scotland for the privilege of having Tom Hicks and George Gillett as owners, is the endgame.

Whoever Huang's backers are - the China Investment Corporation, Franklin Templeton, Dr Yang Guang, Marc Ganis, QSL - he is considered a serious contender to buy the club by Martin Broughton, the chairman, Barclays Capital, the bank appointed to run the sale, and RBS, the principal creditors. They have submitted an outline proposal, and a formal offer is expected to follow.

They may be joined in the bidding process by Yahya Kirdi, the Syrian-Canadian businessman apparently funded by money from Sharjah, one of the lesser Emirates. Rhone Group, the New York private equity firm, retain an interest. The Kuwaiti al-Kharafi family, too, are thought to have contacted Barcap.

Privately, sources acquainted with the deal admit it is hard to see Hicks and Gillett clinging on from here. They are due to refinance in October, and they will be asked to pay down a substantial portion of the debt. That seems beyond their means. The penury that forced Benítez to pull out of a deal for Silva, that allowed City their showpiece signing a year later, may soon be at an end.

And so to the second week which defined the summer. In the first few days of August, as City haggled with Aston Villa over whether James Milner, an essentially unproven midfielder, was worth £24 million or £30 million, Fernando Torres, the world's finest striker, pledged his continuing allegiance to Liverpool.

Cue rejoicing in the streets. If City capture Milner, as they seem set to in the next 48 hours, they would take their summer spending to £100 million for the second season running. Mario Balotelli's arrival would take that to £125 million. More may follow. Yet the impression remains that, despite spending just £3.9 million, and for all Joe Cole is a fine player, in Torres Liverpool has made the signing of the summer.

Here, too, is an illustration of the relative positions of each club. City has enjoyed a productive summer in the transfer market. Silva is the jewel in the crown, but Yaya Toure, Aleksandar Kolarov and Jerome Boateng are all intelligent additions. Milner and Balotelli, too, would contribute to making Mancini's squad the strongest in the league.

But none are players of the calibre of Torres or Steven Gerrard, another Liverpool loyalist whose devotion has been secured this summer. City has spent a huge sum under Arab ownership because of their relative position when Sheikh Mansour arrived: they needed to sign good Premier League players, and are now upgrading to Champions League versions.

That their progress has been incremental was both the correct approach and the only one. They will not, though, acquire a superstar until they are in the Champions League, possibly on a regular basis. Liverpool already have the loyalty of two, plus an array of respected internationals. Should they possess money, they would not need to spend it in the volumes that City have.

That Roy Hodgson last week alluded to his disinterest in a spree when asked who he would buy with a blank cheque and a blank canvas - as City have enjoyed - will come as a relief to those on the Kop, for all their weariness of American-induced poverty. It is most unbecoming of aristocrats to behave like arrivistes.

Mimicking City is simply not required, not least because Liverpool do not need a step-by-step approach. With money, they could aim straight for the stratosphere, if they so desired.

Perhaps, then, the week that posterity will judge the most pivotal is yet to arrive. It is the week Liverpool finally throw off their Yankee oppressors, the week that may define not just this summer or this season, but the old empire's future, and the new order's fate.

Alan Hansen Set For Liverpool Role

Liverpool legend Kenny Dalglish is poised to Kop a place on the Anfield board – and he could be joined by former team-mate Alan Hansen.

It’s part of the club’s mission to bring back old traditions in an era dominated by foreign ownership.

Unloved American co-owners George Gillett and Tom Hicks are attempting to sell up with interest coming from just about everywhere on the globe except the United Kingdom.

That’s why chairman Martin Broughton, mindful of Liverpool’s image, has warmed to suggestions that the club’s heritage should be protected by providing boardroom seats for Anfield legends like Dalglish and Hansen.

Dalglish has already been offered a significant role in the running of the club by manager Roy Hodgson, as head of football development.

There are also moves to involve former defender Hansen, though that could prove more difficult because the Scot is a BBC Match of the Day pundit and could deem it a clash of interests.

Meanwhile, Hodgson is ready to bring in Juventus and Denmark midfielder Christian Poulsen for £5m and Middlesbrough’s Australian keeper Brad Jones for £2.5m, both deals funded by Javier Mascherano’s impending £20m exit to Inter Milan.