With the RBS deadline day looming of October 6th, a date constantly on the mind of many a Liverpool fan, the Royal Bank of Scotland have moved to provide a little optimism that they are prepared to act with a strong hand, by placing the clubs high profile overdue loans in to their toxic assets division.
The move by the bank, Liverpool FC’s biggest creditor, will signal to some as a strong shot across the bows but to alot more that RBS will call time on the circa £237m and rising at resides as the responsibility of Liverpool’s American owners Tom Hicks & George Gillett. Tom Hicks is well known as a man that is certainly not prepared to qo quietly as his business activities in the USA have shown with other sporting organisations, such as the Texas Rangers. In May of this he filed for Chapter 11 bankruptcy protection as a group headed by Chuck Greenbery and Nolan Ryan battled Hicks for ownership of the failing club in the courts.
RBS preference, as that of any fan, would be to conclude the sale of the club to a stable and heavily vetted new owner with the financial resource and knowledge to not only maintain Liverpool FC as an on going concern, but one with the capabilities of restoring itto a level where it can complete on and off the pitch with the leaders in the game. Regardless of these good intentions, it is also clear that as a business in their own right, their own focus has to be on recouping the funds outstanding to them as a priority, an angle of which Kenny Huang had previously opted to head towards in securing the clubs debt as an option to bring RBS on board to his way of thinking.
The nearer the desadline day becomes, the more interest it could certainly become to an investor of the finance level required, perhaps Liverpool would indeed get their wish of more offers on the table than they have previously experienced. It is a waiting game for sure but one that more than a few could be prepared to play, with the so called prize of one one of he worlds greatest ever football clubs available at a knockdown price at the end of it. The valuation placed on the club at present by Hicks & Gillett believed in a number of quarters to be close to the $800m mark, to ensure a healthy return on their investment, albeit achieved by a leveraged buy out purchase on loans that they could not meet. Their refusal to negotiate at a lower level kept many from getting to close to the table, as well as brought in to debate some of the strength and purpose that Martin Broughton actually had in the clubs sale, having been brought in to the fray to do just that.
There of course remains the option that should a sale not being concluded of the club, RBS retain the ability to force the insolvency of Liverpool’s UK parent and associated companies (Kop Football, Kop Football Holdings and Football UK Ltd) into administration. It is very much the final step to remove the owners from the club and take ownership of it themselves, although it does not come without its downside, a nine-point penalty would be imposed on the club by the Premier League if such a step was taken.
Barclays Capital, the appointed investment arm advising Liverpool FC Chairman Martin Broughton, have maintained that Liverpool’s debts with RBS must be paid in full as a minimum sale price, this on its own could be more than an attractive option to many in the field as opposed to the over inflated pricing on offer from Messrs Hicks & Gillett at the present time.
For some, the interest shown by Chinese born businessman Kenny Huang and his associates verged on nothing more than a possible well thought out PR stunt for global exposure, for other his intentions were far more genuine. When he confirmed his desire to walk away from a possible deal, having allegedly grown tired of waiting on decisions being made internally at Anfield, some believe that door was left not quite closed. It remains to be seen if the logic credited to Huang, was that he was indeed the only credible interest in the club and holding the upper hand, he could therefore take over the club at at a later date from RBS, or forced by RBS at a much lower cost. There is certainly a month left for him to materialise on to the scene again, or others of a believed similar status.
Some will say that the prey is being watched and soon the vultures will start to circle.