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Liverpool face ‘Most Important Day in Clubs History’
Published by Ian John on October 10, 2010
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It may not be the setting many Liverpool fans expected, but a courtroom somewhere in the United Kingdom sometime on Tuesday could well decide the long term future of Liverpool FC.
It is then that the courts will rule on whether the chairman Martin Broughton and his board of directors sale of the club to New England Sports Ventures is legal, against the opposition of current owners George Gillett and Tom Hicks.
A decision in their favour will mean, no doubt, that Hicks and Gillett will launch an immediate appeal, but will strengthen the position of NESV and the board and hopefully allow the club to begin to move on after the disasterous tenure of the two American businessmen.
A decision in favour of Gillett and Hicks and the club faces the most uncertain of futures. With the RBS likely to recall their debt on Friday and with the American owners in no position to repay it, it seems likely the club will go into administration, be deducted nine points (which would leave them bottom of the table by eight points – nine from safety and with a game away at the team that would currently hold that position, city rivals Everton, next on the agenda).
Such a move would make Liverpool a far less attractive proposition for NESV and as such, it is debatable whether they would be interested in taking over the club under such circumstances, even if RBS agree to sell it on at the same price NESV currently have on offer on the table.
Either way, it looks like being an uncertain future for the club. Even a ruling in the favour of the current board, against Hicks and Gillett, will no doubt result in a protracted and expensive legal battle that could last many months. This issue is far from dead, even if Liverpool’s season already is.
Meanwhile, down the M62, the plight of their great rivals has gladdened the hearts of Manchester United fans who are revelling in Liverpool’s demise. However, gloating may well be ill-advised given the current financial report from the club.
It’s been presented with wonderful spin, that even Peter Mandelson would have been proud of. United recorded their biggest ever operating profit of £100m+. A fantastic amount of money and one which means the club is in fantastic shape financially, that the likes of Wayne Rooney will not be sold and also that very soon, Lionel Messi will be on his way and they’ll hire the Sultan of Brunei to serve ice-creams at half time.
Only it isn’t quite so wonderful. When you factor in the amount of interest United have paid on their debt, then a £100m+ profit, turns into a loss of £83.64 million over the year.
That is staggering. In effect that means that United have to set record operating profits AND sell a Cristiano Ronaldo every year, to get anywhere near breaking even, given their current scale of debt.
And Liverpool are in a bad way?
United are only avoiding an even greater financial crisis because the onus is not on the Glazer’s to repay the cash any time soon. But there will be a time when they will be and how are United going to make an operating profit of nearly £200m a year, in order to be able to afford to break even?
So, United fans, be careful in your gloating. Liverpool’s house of cards may be about to collapse, but yours is built on even shakier foundations and has a great deal more to support, and believe me, it is going to start wobbling very, very soon.
Image Courtesy of ***Daldroflas*** on Picturebook.com
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