Liverpool Football Club’s American owners Tom Hicks and George Gillett will default on the £237 million-plus of loans they used to buy the club, former government business adviser Lord Sugar predicts.
The deadline for Hicks and Gillett to refinance the £237.4 million Royal Bank of Scotland loan they used to acquire Liverpool expires on October 15. The duo also owe £60 million to the US bank Wachovia.
Hicks and Gillett are understood to be struggling to refinance their loans. If they fail to do so RBS will take control of the club and is prepared to force through a fire-sale of the club.
Former Tottenham Hotspur owner Lord Sugar believes Hicks and Gillett will not be able to refinance their loans, which are secured against the club which is struggling both on and off the pitch.
“What a great institution Liverpool is, what a great football club, but my forecast is that the owners will default on their loans,” Lord Sugar told ESPNsoccernet.
Lord Sugar also warned that unless Liverpool’s finances are sorted out quickly it could suffer the same fate as Leeds, which wound up in football’s third tier due to its unsustainable debts.
“It would be a travesty if Liverpool slipped away like Leeds and ended up in the second division,” he said. “That will happen if they are not careful.”
Hicks and Gillett were unavailable for comment.
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