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Re: Official Liverpool Thread

According to my mate in the press he is prepered to go as highas £350m if needs be to gain control......not sure we really need this news story to give Hicks and Gilette more ammunition before tomorrow' date=' can certainly argue a higher deal (better is questionable) is on the table if all these reports are true. Just need to get them out, administration (although whatever the verdict i think will be unlikely...though it cant be ruled out) could be catastrophic.

What a soap opera....mind you I would have been happier never to have seen this particular soap opera unfold[/quote']

I am pretty certain that negotiations will continue right up until the judge starts proceedings tomorrow

If no deal can be struck before the case, and the High Court then rules in favour of Broughton and the bidders it is a 100% cert that Hicks and Gillet will appeal the decision,

The appeal won't be heard before Friday - and therefore there will be a £40mill penalty to pay the RBS on top of the current outstanding balance.

However the RBS could do 1 of 2 things on Friday

1. Allow Gillet and Hicks an extension (seems unlikely)

2. Call in the loans and put Liverpool effectively in administration

2a. NESV could then buy the club from the administrator - at either the full cost of the loan +charges, or the full value of the loan, OR....agree to pay slightly less to buy Liverpool off the bank

But all this doesn't tae into account the increased offer from Lim - if he does outbid NESV then Hicks and Gillet can clearly show that the NEVS offer undervalues the club - and that in itself could show that the current board were not acting in the best inerests of the owners

Bit worried about the bit about Lim only becoming interested in English football after he owned a number of "Manchester United themed bars in Asia"

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Re: Official Liverpool Thread

Sorry that I haven't responded yet on all this... Have been putting together a post now for a week. Will hopefully get it out by tomorrow...

Just wanted to say that the end game with Hicks & GG was never this first Court appearance. It's all about the appeal.

IMO their approach is to appeal this decision, and to make the Court hear the appeal AFTER their debt is due to RBS.

Why ? Because then Liverpool will fall into the hands of RBS. And Hicks & GG have a chance to get more money out of the deal if it is in an Administration Court.

Unfortunately for what it's worth, RBS may want this too...because it could mean more money for them.

The real issue is what Valuation do you put on the club. IMO Hicks & GG are going to have an easier time of arguing that in Administration Court than they are anywhere else.

Their approach right now is to get it to Administration and then take their chances there.

Case in point... A recent real life example w/Hicks

I realize that US Bankruptcy Courts are going to be slightly different than UK Administration Courts, but at the end of the day they are fairly similar.

This Spring Major League Baseball who was running the Texas Rangers came to an agreement to sell the Texas Rangers to a good group of guys group for $575M ($505M for the club and $70M for real-estate around the stadium owned by Hicks). This Chuck Greenburg-led group didn't have the highest offer, but MLB recognized that they represented the strongest ownership scenario.

Hicks wanted more money. So what did he do...? He let his hometown team fall into bankruptcy.

So now the club is bankrupt, so the existing deal with Chuck Greenberg is shelved, and a new auction takes place in US Bankruptcy Court for the Texas Rangers and it's open to new bidders, not just Chuck Greenberg.

As it turned out Greenberg won the deal in Bankruptcy Court. He bid $593M for the club. Now Hicks didn't see a dime of this because it all went to creditors. But because the club went into Bankruptcy Court, the creditors were able to see an additional $88M for the club.

Ironically Hicks lost $70M from the initial deal with Greenberg by taking the club into Bankruptcy Court. The Court said that his real-estate deal couldn't go through.

So just looking at that scenario and comparing it to Liverpool FC, you can understand why Hicks & GG and yes, maybe even RBS would want to see this enter Administration.

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Re: Official Liverpool Thread

According to my mate in the press he is prepered to go as highas £350m if needs be to gain control......not sure we really need this news story to give Hicks and Gilette more ammunition before tomorrow' date=' can certainly argue a higher deal (better is questionable) is on the table if all these reports are true. Just need to get them out, administration (although whatever the verdict i think will be unlikely...though it cant be ruled out) could be catastrophic.

[b']What a soap opera[/b]....mind you I would have been happier never to have seen this particular soap opera unfold

I hope you weren't expecting anythying else... It just had to have controversy, bs rumours and the yanks trying to pull everything possible to get as much money as possible. What worries me in this Lim guy is this quote that I saw in the BBC article

His interest in English football stems from his ownership of several Manchester United themed bars in Asia - which have persuaded him that there is huge global potential for making money from top-flight English football
Speaking of jokes :P.. I have a favourite one I have always said about Liverpool for a few years' date=' Liverpool are thinking of sponsoring a new tampon company, it will be good for when they go through bad periods. :D[/quote']

No offense, but like Ray said that's a pretty poor joke

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Re: Official Liverpool Thread

Sorry that I haven't responded yet on all this... Have been putting together a post now for a week. Will hopefully get it out by tomorrow...

Just wanted to say that the end game with Hicks & GG was never this first Court appearance. It's all about the appeal.

IMO their approach is to appeal this decision' date=' and to make the Court hear the appeal AFTER their debt is due to RBS.[/b']

Why ? Because then Liverpool will fall into the hands of RBS. And Hicks & GG have a chance to get more money out of the deal if it is in an Administration Court.

Unfortunately for what it's worth, RBS may want this too...because it could mean more money for them.

The real issue is what Valuation do you put on the club. IMO Hicks & GG are going to have an easier time of arguing that in Administration Court than they are anywhere else.

Their approach right now is to get it to Administration and then take their chances there.

Case in point... A recent real life example w/Hicks

I realize that US Bankruptcy Courts are going to be slightly different than UK Administration Courts, but at the end of the day they are fairly similar.

This Spring Major League Baseball who was running the Texas Rangers came to an agreement to sell the Texas Rangers to a good group of guys group for $575M ($505M for the club and $70M for real-estate around the stadium owned by Hicks). This Chuck Greenburg-led group didn't have the highest offer, but MLB recognized that they represented the strongest ownership scenario.

Hicks wanted more money. So what did he do...? He let his hometown team fall into bankruptcy.

So now the club is bankrupt, so the existing deal with Chuck Greenberg is shelved, and a new auction takes place in US Bankruptcy Court for the Texas Rangers and it's open to new bidders, not just Chuck Greenberg.

As it turned out Greenberg won the deal in Bankruptcy Court. He bid $593M for the club. Now Hicks didn't see a dime of this because it all went to creditors. But because the club went into Bankruptcy Court, the creditors were able to see an additional $88M for the club.

Ironically Hicks lost $70M from the initial deal with Greenberg by taking the club into Bankruptcy Court. The Court said that his real-estate deal couldn't go through.

So just looking at that scenario and comparing it to Liverpool FC, you can understand why Hicks & GG and yes, maybe even RBS would want to see this enter Administration.

.

I guess under UK law, if Liverpool go into administration with Hicks and Gillet stil las owners they can then negotiate directly with the clubs creditors.

This means they could offer say 80p in the £ to RBS - meaning they would only have to pay off 4/5s of what they owe - and then they can sell the club for the £00+ million being offered - thereby reducing their own personal 'hits' (they could even offer as little as 1p for every £ owed - RBS wouldn't accept that though as the assets are secured on the debt)

The fact that they have done pretty much this already to Texas Rangers shows that they have no concerns for the sports clubs or communities around them.

If only the old Liverpool board had crystal balls.

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Re: Official Liverpool Thread

If only the old Liverpool board had crystal balls.

They knew exactly what they were doing. I've read all this stuff on RAWK and on here recently about poor ol' Moores and how he didn't do enough due diligence on how bad a guy Hicks is. Rubbish !

The fact is that you didn't need to do any due diligence on Hicks. The only thing that Moores and even that two-faced "Red Knight" Jim O'Neill needed to know when they sold their respective clubs was that they were being bought through Leveraged Buyouts. These guys knew exactly what they were doing. They were taking top dollar for themselves. And then they have the gall... the absolute gall... to come out years later and condemn those same LBO guys. Pathetic. And even worse' date=' is that they have pulled the wool over the eyes of rabid Mancs & Scousers who only see hatred for the Americans.

My firm was approached way back when by Hicks to go in on a deal to buy Liverpool FC, and we couldn't get the numbers even close to turning a profit. NOT EVEN CLOSE.

[b']This was a loss from the beginning. It was only ever going to end up like this.[/b]

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Re: Official Liverpool Thread

They knew exactly what they were doing. I've read all this stuff on RAWK and on here recently about poor ol' Moores and how he didn't do enough due diligence on how bad a guy Hicks is. Rubbish !

The fact is that you didn't need to do any due diligence on Hicks. The only thing that Moores and even that two-faced "Red Knight" Jim O'Neill needed to know when they sold their respective clubs was that they were being bought through Leveraged Buyouts. These guys knew exactly what they were doing. They were taking top dollar for themselves. And then they have the gall... the absolute gall... to come out years later and condemn those same LBO guys. Pathetic. And even worse' date=' is that they have pulled the wool over the eyes of rabid Mancs & Scousers who only see hatred for the Americans.

My firm was approached way back when by Hicks to go in on a deal to buy Liverpool FC, and we couldn't get the numbers even close to turning a profit. NOT EVEN CLOSE.

[b']This was a loss from the beginning. It was only ever going to end up like this.[/b]

.

I've read a few of your blogs and you certainly seemed more enlightened on the financial side than 99.9% of the other fans - now I understand why :D

I've been trying to educate the United fans re their debt - but as a City fan they see it as me having a go at them. I've also tried to educate the Man City fans that all this money doesn't come for free - at some point someone will have to put their hands in their pockets.

Fortunately for City at the moment this seems to be coming through 'sponsorships' that seem to be bordering on nepotism

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Re: Official Liverpool Thread

Get ready to lose your minds for a second because I believe that there is a decent chance that Hicks could raise $150M very soon

That said, as of right now, he will NOT be able to use any of that money to fund anything Liverpool-related

Please bear with me as I walk through my thinking and rationale with all this...

And for what it's worth, to my knowledge no one has picked up on these recent changes yet.

The press certainly hasn't.

People are certainly aware that Hicks has a potential SPAC deal in the works for months now

But no one is talking about the BIG CHANGES that have recently taken place

And for anyone who doesn't want to read through my assumption at what Hicks was up to over the past week,

just scroll down to the last two charts and compare.

For me the issue was never RBS or Wachovia refinancing the existing debt, because those moves are only very short-term band-aids.

The issue all along for me was (1) would RBS's distressed debt portfolio managers show enough fortitude to take "ownership" of Liverpool FC and (2) more importantly would Hicks be able to raise a big chunk of money via the public markets with his SPAC which he could turn around and use to either buy his way out of trouble @ Liverpool or cause even more trouble.

Probably the best financial (and certainly the most profitable) thing that Hicks was able to accomplish over the past few years was the IPO of his Special Purpose Acquisition Company (SPAC) in 2007. Well, after 3 months of trying to get his 2nd SPAC IPO, I believe it's going to be very possible that he gets it done over the coming weeks.

So what is a SPAC ? A Special Purpose Acquisition Company. It is essentially a company that has no operations. It has no products and no services. However, what it does have is a group of people who have some sort of experiences "building" businesses. These people form a SPAC and IPO it. In doing so they publicly raise funds to go out and acquire a company with over a set amount of time.

Hicks' 1st SPAC, Hicks Acquisition Co I, was a mixed bag for those people who bought it. With the $490M in proceeds from the IPO Hicks ended up buying an oil and gas producer out in Utah. He did this of course only after he tried to unsuccessfully lever-up the $490M to acquire a $3.2 Billion plastics packaging company from Blackstone. Hicks profited much much more than the people who bought his deal @ $10. As you can see in this chart below it has basically performed inline with the overall US market, but at much greater volatility.

Resolute.jpg

Recently Hicks has been trying to IPO his 2nd SPAC, called Hicks Acquisition Co II since this past June. He couldn't do it though. The IPO market for SPACs completely dried up.

The Monday (9/27) that Hicks was here in NYC and was spotted on the street, he wasn't in meetings related to financing from Blackstone et. al. Instead he was here because he had "teach-ins" with the various Institutional sales forces who were supposed to find clients to buy this recently planned IPO. He was also likely meeting with some bankers from Citi & DB to make the changes that I am about to describe to the IPO. That is why he was @ the DB building all afternoon.

Most importantly he was adding another name to help him out in selling this SPAC to the public. That Monday Hicks filed new details of the deal with the Securities Exchange Commission (SEC). The big change that he made was adding the company Ladenburg Thalmann & Co to the other two banks (Citi & DB) who were going to try to sell this deal. At the end of the day Citi & DB really don't have a great Rolodex from which they can contact clients to sell these type of SPAC deals. Instead, Citi & DB are interested in doing the deal because they want to sell one of their banking clients to the executive team who is running the SPAC.

Anyway... Monday (9/27) rolls around and Hicks gets feedback from Citi & DB that they just don't have the client interest to do the deal anytime soon. So Hicks thinks to himself... "Who out there knows a list of clients that would be willing to take on a SPAC IPO in this market where most Institutional firms are cutting their risk profiles?" So he says, "Who was able to do the last SPAC IPO?" Well...It turns out that it's a company called 57th Street General Acquisition Corp (ticker: SQTCU). They did the very last SPAC IPO back in May of this year. Since then there hasn't been another one. So Hicks calls up the head guy @ 57th Street General Acquisition Corp. This guy's name is Mark D. Klein and he says to Hicks, "Sure for a fee I'll give you the list of the guys who bought my SPAC IPO." This guy Mark D. Klein is the ex-CEO of this chop-shop investment bank called Ladenburg Thalmann & Co. Furthermore, he says that in addition to the big fee that he is personally being paid by Hicks, that his old firm, Ladenburg Thalmann, should have its name on the IPO prospectus, so that Landenburg's bankers can claim a "win" this year. Why do I suspect this to be true ? Because of the following in the prospectus for Hicks' deal :

Under the section "Use of Proceeds"

SPACII.jpg

And despite being on the cover as a banker in the deal, Ladenburg Thalmann & Co. isn't listed as one of the Underwriters, and thus won't be seeing any banking fees.

SPAC1.jpg

This is not typical at all. Because of this I am led to believe that Mark D. Klein simply gave Hicks his client list from his successful IPO in May, and the company that Klein use to run, Landenburg Thalmann & Co, were thrown a banking publicity bone by having their name next to Citi & DB on the cover of the prospectus.

So Hicks' bankers then have to resubmit documents to the SEC to recognize these changes. They do so that Monday (9/27) using the same terms of the deal : 20M shares being sold to the public @ $10 apiece ($200M total value). See HERE.

So last week rolls around and this SPAC IPO is supposed to price and go out to the public. They try on Monday and Tuesday to get the deal out, but no dice. By Wednesday night word came back that the deal wasn't going to get done even with this new client list. Citi & DB came back to Hicks either Wednesday night or Thursday and essentially said that the valuation of the deal ($10) was fine, but that they simply didn't have enough clients who were willing to take all 20M shares.

Fast forward one day to this past Friday (10/8). Hicks is in desperation. News of the John Henry's NESV bid has already come through. Hicks bites the bullet and calls up Citi & DB and says lets cut the deal to 15M shares ($150M total value). And they do it. See HERE.

I believe that Hicks' $150M SPAC IPO deal could price this week or next and that this guy could see a nice chunk of change in his pocket. I'm not saying it will 100% happen, but Hicks has scrambled a lot in the past three weeks to see that there is a good chance that it does get done.

If you want to see some further filings just go HERE on the SEC website and search Hicks.

Keep in mind that I am not first-hand privy to any of this. I don't invest in SPACs and I was not involved in these meetings nor have I communicated with anyone who was. This is all speculation on my part. However, being an Institutional investor who has been around the block and walking through the timing and these events, all of this makes perfect sense.

One question I have is "Who are the investors on this client list that I believe Mark Klein sold to Hicks to fund his SPAC?" For that we have to check out the people who registered as owners of Klein's 57th Street General Acquisition Corp. That SEC website is as good a place as any to start.

Here are some the names that you can come up with by doing a quick search of institutional investors who took on Klein's IPO (not the cream of the crop):

Anyway the BIG question is "Can Hicks use the proceeds of any SPAC IPO to bail him out of his debts @ Liverpool ?"

I can happily tell you that the answer is NO, he cannot. smiley.gif However, this is a vastly different answer than it was as of last Thursday (10/7).

Here's what the IPO prospectus said (page 1 Summary) as recently as last week :

YesLFC.jpg

The highlighted text basically says that Hicks can invest this money in ANY business or partnership that he wants to.....Liverpool included. That was as recently as this past Thursday.

So remember that this past Friday (10/8), Citi & DB changed the deal to 15M shares... Well I wanted to see what else they changed. It turns out that there was a BIG CHANGE.

After this past Friday night's changes, here is how the new prospectus reads :

NoLFC.jpg

Compare the highligted text. Notice the difference...?

This is a MAJOR blow to Hicks...!!! The banks basically came back to him last week and said that not only couldn't they place anything close to the 20M shares of his IPO, but that they were also recieving concerned questions from Institutional investors (even the 2nd & 3rd-rate ones) about whether or not Hicks was going to use the IPO proceeds for anything Liverpool-related, and that if he was that they wanted no part of the deal. Hicks not only capitulated on the size of the offering (20M down to 15M shares), but he also had to concede and put in writing that he would not use the proceeds for anything Liverpool-related.

Anyway... I just wanted to highlight this. I know that some of you are going to lose your heads when you see that he raised $150M, but rest assured that (barring him changing the prospectus) in NO WAY can he use it related to Liverpool FC or his related debts.

This battle is FAR from over, but at least there is one less bullet in his rusty Colt 45.

Cheers from NYC,

Johnny C

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Re: Official Liverpool Thread

I'm suprised no one mentioned about Peter Lim the Singaporean billionaire who was in the front running to buy Liverpool before NESV stepped in. If RBS wins the court case and sends Pool into administration' date=' NESV might pull out and Peter Lim might lead the queue once more[/quote']

If RBS win the court case and Gillett and Hicks don't win then they will avoid administration,that's providing Gillett and Hicks don't appeal which there pretty much certain to do.

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Re: Official Liverpool Thread

I'm suprised no one mentioned about Peter Lim the Singaporean billionaire who was in the front running to buy Liverpool before NESV stepped in. If RBS wins the court case and sends Pool into administration' date=' NESV might pull out and Peter Lim might lead the queue once more[/quote']

Peter Lim has been mentioned a couple of times - and been quoted as saying he 'only' became interested in English football after he had owned 'several Man Utd theme bars throughout Asia'.

Not the sort of statement you expect from your new prospective club owner as he is basically saying two things;

1. I had no interest in Liverpool FC or English football until I owned some UNITED bars - that's almost as bad as Gary Neille making a bid

2. I made a profit from English football themed bars - now I can make a profit direct from the club itself.

To be honest the second point is why most owners by a football club these days - they just don't say it so blatantly :D

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Re: Official Liverpool Thread

Sorry SmartDoc - no pain was intended - however I would have been better placed to use the name of Dr Shipman or Fred West than that of Neville Nevilles son lol

No worries mate, I've just cheered myself by checking out my saved link from the urban dictionary on Gary Neville. I would post it up, but some of it is a little offensive and unnecessarily derogatory, but the bits in between always cheer me up :)

EDIT: Link available on demand via PM :D

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Re: Official Liverpool Thread

Well done on definitely been sold as there appeal got rejected' date='I hope you don't decide to go with Lim know as the fact he made his fortune through Man Utd themed bars isn't encouraging at all,and at least Henry has a good track record in sports or business ventures his done.[/quote']

They haven't had their appeal rejected - just that the judge did not offer them to the right to appeal.

They can still apply to the Court of appeal to lodge an appeal against the decision.

The sale should still ultimately go through (to one of the three bids) but it could be a couple of weeks before it can be formally ratified

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Re: Official Liverpool Thread

They haven't had their appeal rejected - just that the judge did not offer them to the right to appeal.

They can still apply to the Court of appeal to lodge an appeal against the decision.

The sale should still ultimately go through (to one of the three bids) but it could be a couple of weeks before it can be formally ratified

I heard somewhere that Martin Broughton signed a legality binding contract with NESV

So can he only sell to them or what ?

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Re: Official Liverpool Thread

People go on about the owners' date=' but what will new owners do? It's not like Benitez had no funds, 20M on Aquilani, 20M on Johnson..

Just a question..not a dig.[/quote']

Theyv'e took them to brink of Adminstration though mate,they wanted to make money out of the club which they were doing but they couldn't afford to do,the two signings above were serviced by the money from Alonso,Johnson only joined for £10 Million as well as they made sure Portsmouth didn't have to pay any money for Crouch which Liverpool were due,considering they sold Alonso for £30 Million as well they spent pretty much nothing when taking into consideration the sales as well.

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Guest JackWWFC

Re: Official Liverpool Thread

Theyv'e took them to brink of Adminstration though mate' date='they wanted to make money out of the club which they were doing but they couldn't afford to do,the two signings above were serviced by the money from Alonso,Johnson only joined for £10 Million as well as they made sure Portsmouth didn't have to pay any money for Crouch which Liverpool were due,considering they sold Alonso for £30 Million as well they spent pretty much nothing when taking into consideration the sales as well.[/quote']

8M Net Spend I think. Still, I think people needed a scapegoat and blamed Gillett and Hicks.

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