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Why Liverpool Fans Shouldn’t Fear Administration

 Why Liverpool Fans Shouldn’t Fear Administration
The word administration will universally strike fear in football fans. Points deductions and a mass exodus of players is something that will normally follow after a club slips in to administration, however I am certain Liverpool won’t have to suffer the costs of the dreaded A word.

British newspapers are today reporting that Liverpool slipping in to administration will mean the collapse of the NESV takeover. However I can’t see why Liverpool’s finances will collapse in that way.

If the High Court rules that the NESV takeover cannot be completed, then it will be down to the Royal Bank of Scotland to decide the clubs fate. Their options would then be, to call in the massive debt, and effectively repossess the club, or to extend the time given to Tom Hicks and George Gillett to repay the loans.

The later of the two options seems highly unlikely given the duos past record of paying their debts. So what would happen if the club was to be repossessed?

In this case the Bank of Scotland could appoint an administrator, however it would seem pure madness to do so when there is a party who is actively looking to buy the club. The most sensible solution would appear to be for NESV to simply clear the clubs debt with RBS and therefore takeover the club.

So Liverpool fans shouldn’t be alarmed by the murmurs of administration because it would be a move that wouldn’t suit any party. As long as there is interest in the club, Liverpool will not be going in to administration. With a club of Liverpool’s history and prowess, there will always be interest.

Yes this is all speculation, and with the strange dealings that have gone at Liverpool during the past few weeks and months maybe we should expect the bizarre, but you have to feel that Anfield will be free of the burden of Hicks and Gillett in the not so distant future.

On a side note, Tom Hicks summed up his relationship with Liverpool fans by saying they “are a noise we are dealing with.” I think that says it all about this regime and the desperate need for change on Merseyside.

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9 Responses to Why Liverpool Fans Shouldn’t Fear Administration

  1. Simon Burke says:

    Couldnt you argue the other way? Administration means Liverpool will be dead last and the way they are playing means they just may not get back to 17th this year and go down. Players will be linked with moves all season, RBS first responsibility is to get its money back and who knows how they will deal with player sales. No new owner who then got Liverpool on the cheap could players in till January and what players will want to go ?

    Thats said I think it will all work out and the sale will go ahead. I wouldnt bet my house on it though.

  2. Hicks Hater says:

    I don’t think we should forget that RBS has a moral responsibility in all of this. They lent the money to Hicks and Gillett which allowed them to hold on to the club, they set the deadline for the calling in of loans and they appointed Martin Broughton who oversaw the sale. So the responsibility for H + G falls partly on RBS, as does the timetable which has been imposed on the club. RBS should therefore do everything they can to make sure the club doesn’t go into administration and if this means giving a 10 day stay of execution to allow an appeal to be heard, so be it. No one is going to refinance H + G at this stage- it is clear they are both heading for bankruptcy- so the important this is that nothing occurs which further jeopardises the future of LFC.

  3. anon says:

    I don’t think you understand. When RBS, the creditor, calls in the loan, it is effectively administration.

    • Tim says:

      Right but they don’t have to call in the loan they could try and force the sale to NESV. What I don’t understand is why H&G are blocking the sale as surely administration would be worse for them.

      • Hicks Hater says:

        I guess they are desparately hoping another bid comes in in the next few days. Or else they are going to try to sue the bank for having organised a sale which ‘undervalued’ the club. Or maybe they are just so desparate they don’t know what they are doing anymore. Gillett is pretty much bankrupt anyway and it sounds like the Liverpool saga might push Hicks in the same direction.

  4. Paul Cummings says:

    Looks to me like the Yanks are playing there last hand! I am sure they are attacking the board with “You try and undercut our valuation and sell the club at a lose to us, and we will hold up the sale and go to court, If the courts take the Yanks side as they are the share holders 100% then RBS can call the loan but LFC will take a 9 point deduction and the Red Sox owner’s will walk away! Then you have no buyer”
    Kind of sounds like a game of Texas Holdem lol

    • Hicks Hater says:

      I actually think the threats of 9 point deductions and NESV possibly walking away might be being leaked from the LFC side- in a hope to influence the court by demonstrating the potential consequences. Obviously if NESV did walk away because of that then they wouldn’t have been very committed owners anyway.

  5. Alex says:

    “A noise we are dealing with”?

    Hicks is a moron and a liar that we have to deal with.

  6. Yespage says:

    Clearly this can all be resolved with passing a massive tax cut for the uber-wealthy in America. That way Hicks and Gillette can continue to own Liverpool and continue Liverpool on their great run of the past couple of years.

    I don’t know. It just seems the worst case scenario has seemed to be the actual case for Liverpool recently. Typical top level rich Americans want to make a profit on an investment they let sour.

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