There is so much speculation surrounding Liverpool's finances at the moment, it is hard to know where to turn. You hear so many whispers and rumours that you wonder what to believe.
The idea that the mooted interest from the Rhone Group, a US-based private equity firm, was merely a ‘stalking horse’ is interesting. This sort of thing goes on in business, as you would expect, so it is likely to happen in football. The idea with this is to flush out any genuinely interested buyers by playing up interest from another party. Whether it works or not is another matter.
Without wishing to just pluck numbers from the sky, investment in Liverpool – when you factor in the stadium and squad enhancements – could be anything between £500 million and £1 billion. That is the reality of the situation at the moment.
What does surprise me is the mention of the concrete deadline of April 6 for fresh investors. Now it appears that this has been changed from a 'deadline' into a ‘guideline’. But don’t forget that another re-financing deal is due with the Royal Bank of Scotland in July, and this is almost entirely dependent on Liverpool qualifying for the Champions League, which at the moment is uncertain at best.
If Liverpool - under the ownership of Tom Hicks and George Gillett - do miss out on the Champions League, I think they are in big trouble, as I simply can’t see how they can meet their interest repayments.
That is why the deadline of Easter for fresh investment seemed a little strange; why would any would-be investor get involved at this stage of proceedings, when everything is still up in the air on-the-pitch? Surely they would wait until the summer.
As to whether Champions League football is really important from an investor’s point of view, it is hard to say. Of course any investor will want the lowest possible price, and it could be that investing in a club that is not in the Champions League enables that.
But then if you invest into a club that has fallen out of the Champions League for a season, you need to weigh up whether it is a long-term thing, and how much it will cost to get back in there. Liverpool would obviously need serious spending on the playing side of things, and that is without even mentioning the new stadium.
A lot of people have almost forgotten about the new stadium when they talk investment with Liverpool, with everyone focusing on the debt side of things. The new stadium, on Stanley Park or anywhere else, is going to be a huge cost, even more so than clearing the debts.
Let’s be clear on this; anyone who is looking into Liverpool as an investor is doing so because of the name and the prestige of the club. A club like Newcastle, for instance, may have its merits from an investment point of view – a hefty 50,000-seater stadium for example – but in terms of prestige Liverpool and Newcastle are worlds apart, and that goes for the amount of investment that both clubs would require.
The idea that the mooted interest from the Rhone Group, a US-based private equity firm, was merely a ‘stalking horse’ is interesting. This sort of thing goes on in business, as you would expect, so it is likely to happen in football. The idea with this is to flush out any genuinely interested buyers by playing up interest from another party. Whether it works or not is another matter.
Without wishing to just pluck numbers from the sky, investment in Liverpool – when you factor in the stadium and squad enhancements – could be anything between £500 million and £1 billion. That is the reality of the situation at the moment.
What does surprise me is the mention of the concrete deadline of April 6 for fresh investors. Now it appears that this has been changed from a 'deadline' into a ‘guideline’. But don’t forget that another re-financing deal is due with the Royal Bank of Scotland in July, and this is almost entirely dependent on Liverpool qualifying for the Champions League, which at the moment is uncertain at best.
If Liverpool - under the ownership of Tom Hicks and George Gillett - do miss out on the Champions League, I think they are in big trouble, as I simply can’t see how they can meet their interest repayments.
That is why the deadline of Easter for fresh investment seemed a little strange; why would any would-be investor get involved at this stage of proceedings, when everything is still up in the air on-the-pitch? Surely they would wait until the summer.
As to whether Champions League football is really important from an investor’s point of view, it is hard to say. Of course any investor will want the lowest possible price, and it could be that investing in a club that is not in the Champions League enables that.
But then if you invest into a club that has fallen out of the Champions League for a season, you need to weigh up whether it is a long-term thing, and how much it will cost to get back in there. Liverpool would obviously need serious spending on the playing side of things, and that is without even mentioning the new stadium.
A lot of people have almost forgotten about the new stadium when they talk investment with Liverpool, with everyone focusing on the debt side of things. The new stadium, on Stanley Park or anywhere else, is going to be a huge cost, even more so than clearing the debts.
Let’s be clear on this; anyone who is looking into Liverpool as an investor is doing so because of the name and the prestige of the club. A club like Newcastle, for instance, may have its merits from an investment point of view – a hefty 50,000-seater stadium for example – but in terms of prestige Liverpool and Newcastle are worlds apart, and that goes for the amount of investment that both clubs would require.
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