Liverpool board to resist attempts by Hicks to refinance debts

Liverpool FC managing director Christian Purslow has insisted that the club’s board members will firmly resist any attempt by the co-owner Tom Hicks to refinance the club’s debts of £237million with Royal Bank of Scotland.

Reports suggest Hicks is trying to raise cash through a newly formed shelf investment company, Hicks Acquisition II in order to buy out the RBS debt ahead of next month’s (October) refinancing deadline in a bid to retain control at Anfield.

Asked if Hicks could refinance the debt against the club’s assets Purslow said: “That would require Board approval and the other members of the Board have made it clear that’s not what we want to see happen.”

It is understood that Royal Bank of Scotland would rather see that the club is sold to a new owner by October 15 but given the over-optimistic £600m-plus valuations that Hicks has placed on the club it remains likely that a sale will not be complete by the deadline.

Even with such high debt levels Purslow has confirmed that Liverpool can just about service those debts through its core operations, but one cannot avoid the premise that if Liverpool were debt free, it would be one of the World’s most profitable clubs.

Whilst commercial debt and football do go hand in hand, it’s the leveraged debt in the case of Liverpool in order to buy the club, rather than invest in a new stadium that has left a biter taste with the fans.

Just as any corporate business, Liverpool needs to remain a successful brand and in addition to reducing commercial debt recovery of on pitch activities needs to be brought into the spot light.

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