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A Summary of the Liverpool Sale to N.E.S.V.

European Football - UEFA Champions League - Semi-Final 2nd Leg MD12 - Liverpool FC v Chelsea FC

The sale of Liverpool from the grips of Hicks and Gillett was always going to be a messy one but no one could have foreseen the events that took place in the last few days of this sale. The excellent Guardian web site and Official Liverpool web site kept supporters up to date with the latest developments but it still proved difficult to make sense of what was happening. Here is an attempt to briefly summarize the major events leading up to the sale.

  • Hicks and Gillett buy the club in early 2007 and are subject to some fan protests within the first two years of ownership.
  • In April of this year, Martin Broughton is appointed the chairman of Liverpool. His responsibility is to find a buyer for the club.
  • After a few rumored buyers and failed attempts, the Liverpool board meets with N.E.S.V. and agrees a sale. However, Hicks and Gillett believe the sale greatly devalues the club and attempt to remove members of the board with allies that are against the sale.
  • The Liverpool board are forced to make the attempted sale public and take their case to the London courts. After the judge sides with the board, they are granted approval to go forward with the sale.
  • Hicks and Gillett file a restraining order against the board in a Dallas court. They also file to sue the board for damages.
  • The Liverpool board once again convene in a London court to decide if the Dallas court and restraining order has any legal authority in the case. They court, once again, sides with the Liverpool board and Hicks and Gillett are asked to throw out the restraining order or face legal trouble in Britain.
  • Rumors circulate that Hicks is attempting to sell his shares to Mill Financial in an attempt to make them the primary owners of Liverpool FC. Mill Financial already took over Gillett’s shares after defaulting on loans.
  • Hicks and Gillett withdraw their restraining order against the board after a delayed court hearing in Dallas.
  • N.E.S.V. buy the club for what is thought to be around £300 million with about twenty minutes left until the Royal Bank of Scotland would declare the club in administration. Liverpool are left with no debt and a new owner that appears to not be the ultra-rich money splasher of other big clubs like Manchester City and Chelsea but a smart businessman that has proven his ability to take a historic club back to winning ways.
  • N.E.S.V. and Liverpool supporters decide to develop Anfield in place of building a new stadium and are able to greatly increase their revenue almost right away at a reduced cost to the club. Liverpool then go on to win the remainder of their games and are able to quality for the Champion’s League.

Well, maybe that last bit was a little wishful thinking.

The events leading up to this sale were difficult to make sense of. Please feel free to leave me a comment if you feel I left something out or have a detail wrong.

Also, I think my thoughts on the sale are pretty much spelled out in this article but please let me know what your thoughts are on the sale and new owner.

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  1. Terry

    October 17, 2010 at 3:57 pm

    After toaday’s performance against Everton I wonder what Henry and company must think of their purchase. They’ve bought a really turkey of a team led by a manager who seems like he has no idea what tactics to use or team to choose. Unless NESV yield the axe and get rif of the entire coaching staff and bring in a new team of coaches with better ideas and tactics this ship will continue to sink fast.

  2. dominjon

    October 16, 2010 at 8:08 pm

    Man U are not in debt because of big spending, they were a leveraged purchase exactly as Liverpool were. The only difference between Man U and Liverpool under H&G is Utd have a bigger stadium to produce greater revenue and have never missed out on Champions League money. It is still a unsustainable long term model and is the real reason behind Man U’s “only buying young players” policy. You can normally buy younger players with less money upfront and more clauses to spread the payments.

  3. SantaClaus

    October 16, 2010 at 3:20 pm

    All the clubs that are winning trophies at present have owners that are willing to spend big even if it means going into debt. Will NESV follow the Man U (Glazer) model, huge debts but top 4 team, or the Aston Villa (Lerner) model, little to no debt but mid-table team. I would put my money on the Lerner model which means Liverpool will struggle to go above the top 3 plus Manchester City. Arsena lis the only club not in debt because they have a manager that develops young talent. Liverpool don’t have that advantage. There is a huge difference between owning a US baseball team and a European soccer team. A winning model in the US does not translate well into success in the EPL. I’m glad Liverpool have their ownership sorted out as it was getting to be a distraction and Hicks and Gillette had to go. Not sure if the present Liverpool team and manager are capable of turning things around. So far I haven’t seen anything on the field that makes me optimistic of any turnaround. Hodgson seems out of his depth at Anfield and the players are playing rubbish soccer.

  4. Gareth van der King

    October 16, 2010 at 6:21 am

    Soon the scousers will hate this lot too.
    The pool are going to find it difficult to get back to the glory days.
    These owners are not going to be like Man city or Chelski’s but more like Villa’s. The pool need major investment to compete at the top.

  5. Lyle

    October 15, 2010 at 6:52 pm

    Yay… the Kop loves Americans again! Yay! The jingoistic, anti-American days are gone forever! Yay!!!

  6. Carolyn

    October 15, 2010 at 4:41 pm

    Liverpool may have settled one major problem with a change of ownership but I think the other major problem still exists, that is the horrible performance of the team. I still think that Roy Hodgson is not the right manager for Liverpool and that the team will not improve unless a new manager comes in with better tactics, team selection and better motivational skills. We will have to wait and see how long it takes NESV to begin making changes that improve the team’s performaces. For now, Liverpool have solved one problem but the other remains. It’s better to have unpopular ownership with a winning team (Like Manchester United) than a popular owner and a mediocre team.

    • Lyle

      October 15, 2010 at 6:53 pm

      Hodgson haters are the worse people in the world. He’s the best thing that has ever happened to Liverpool. Mark my words.

      • Gaz Hunt

        October 15, 2010 at 7:14 pm

        I’m not sure he’s saying he hates Hodgson – he’s saying he may not be the manager for this particular club.

        I personally disagree and also think Hodgson is one of the best things to happen to Liverpool.

  7. Charles

    October 15, 2010 at 4:22 pm

    I have one question. Liverpool was facing a huge debt. Where did it go? Was it wrapped up into sale, so that the debt was part of the 300 Million pounds, if so what was the real value of the club? Chuck the late comer

    • Gaz Hunt

      October 15, 2010 at 4:44 pm

      Not sure if the 300 million includes the debt or not. At first I thought that it didn’t but looking further into it, I think that the 300 million may include the debt needed to pay off to purchase the club.

      • Brian

        October 15, 2010 at 11:29 pm

        The 300 million pound purchase price does include the debt. In any sale of a business where the whole thing is purchased, the accountants add up the total book value of the assets (stadium, trademarks, equipment, etc) and subtract from that the total book value of the liabilities (i.e. debt). The difference between the two is the net book value of the company. For Hicks and Gillette to make a profit on the sale, the value of the assets must be more than the liabilities. Based upon the news reporting, I am going to assume that the bid of 300 million was equal to or less than the net book value of the business.

        In any case, John Henry and company have acquired a great club with excellent potential. My guess going forward, is that they will go ahead and redevelop Anfield in the same way they did with Fenway Park.

  8. Fernando

    October 15, 2010 at 4:13 pm

    One of the interesting things about the whole Liverpool saga has been that some pundits have questioned the intentions of the foreign owners. That barb is usually aimed at the American owners.

    Say what you will about the Glazers and Hicks/Gillette, but the mere fact that there have been ZERO bids from any serious bidders from the UK makes me think that the pundits should be asking why the richest people in England avoid buying these teams.

    It’s clear the American owners see earning potential that could potentially dwarf what their American teams make.

  9. LizM

    October 15, 2010 at 2:39 pm

    I’d love to see a Peter Morgan movie about all this.

  10. Ryan

    October 15, 2010 at 2:13 pm

    Good summary! The last note is a similar wish I hope for. It might be awhile before I have the funds to travel to Anfield – I’d love for it to be my first live Liverpool experience…not a new stadium.

  11. dominjon

    October 15, 2010 at 2:09 pm

    NESV got a very good deal, I hope they will therefore be able to swiftly work on either a new stadium, or if it posible, finding a practical way to add 20,000 more seats to Anfield. Also, although I expect sensible transfer policies, I would hope they make some sort of exception in January and bring in some real quality.
    I expect Hodgson to be given some time to show he is up to the job, but if Liverpool continue to struggle badly then I hope they get a new manager in time to be in charge for those purchases in January.

  12. Matt

    October 15, 2010 at 2:07 pm

    Who’s Gillette? A razorblade?

  13. Phenoum

    October 15, 2010 at 12:55 pm

    wow – only 300 pounds? I could’ve bought Liverpool!!!

    • Gaz Hunt

      October 15, 2010 at 1:00 pm

      Hah! Should be fixed now to read £300 million.

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