(WFI) Liverpool’s future ownership should be decided tomorrow morning.
It follows a day of drama at London’s High Court where the club’s bankers Royal Bank of Scotland (RBS) are attempting to force the sale of the club against the wishes of owners Tom Hicks and George Gillett.
The case opened this morning as news broke of a fresh £360 million ($569m) cash bid for Liverpool from the Singapore businessman, Peter Lim.
In London the complexity of Liverpool’s situation was exemplified by the presence of five QCs at the packed courtroom.
RBS have taken the action in an attempt to force through Liverpool’s £300 million sale to the New England Sports Ventures (NESV) group after Hicks and Gillett defaulted on loans owing to the bank.
Last week Hicks and Gillett tried to block the sale by sacking Liverpool directors Ian Ayre and Christian Purslow, but were blocked from doing so by club chairman Martin Broughton.
What the case boils down to is whether Broughton and his fellow directors have the right to agree to sell the club despite the objections of Hicks and Gillett, who remain – in essence – majority shareholders.
The court heard how Hicks and Gillett contravened a sales agreement with RBS by trying to oust Ayre and Purslow and demanded it impose a mandatory injunction to make sure that the board be reinstated.
Hicks and Gillett’s counsel admitted that they had breached the sales agreement, but argued that they had been forced to do so because the board excluded them from the sales process.
They claimed that the board refused to consider stronger alternative bids to NESV, including one made by Meriton last week, who they claim offered to put up £100 million for a new stadium development. They also claimed that Mill Financial, a US hedge fund, which owns 50% of Gillett’s stake after
he defaulted on a £75 million loan two years ago, sought to buy the club but were ignored.
As a result of these apparent blocked sales, Hicks and Gillett were left with no alternative but to act against the board. Because of this they disputed the injunction claim.
The Liverpool board’s QC disputed the claim that the owners were excluded from the sales process and accused the owners – who he described at one point as “slippery” – of obfuscating and not actively participating in the sales process. He insisted that NESV’s offer was the best on the table.
This afternoon, Justice Floyd cast doubt on whether a verdict would be immediate, saying Friday’s deadline – when Liverpool could face the possibility of financial administration and a points deduction – was “a little ambitious”.
Later he said that a judgment would be made at 10.30am on Wednesday. Whether that judgment will be definitive remains to be seen.
The wild card in amongst all this courtroom drama is Lim’s offer, which consists of £320million for the club and its liabilities, plus £40million to buy new players.
“I respect and admire Liverpool Football Club, which is steeped in tradition and history. I am committed to rebuild the Club so that it can soon regain its position at the pinnacle of English and European football, where it truly belongs. This is why I have stepped forward with this offer,” Lim said in a statement.
Lim claims that the money is available immediately, including cash to strengthen Hodgson’s squad, “removing the threat of administration.”
That prospect is still a possibility if legal argument persists beyond Friday, when RBS has imposed a deadline for Hicks and Gillett to repay their loan. If they don’t, RBS can take the club into administration. It would necessitate a nine-point penalty from the Premier League, but would allow them to seize control of the club and sell it to whomever they like.
But nothing should be taken for granted. If anything, the past week has exemplified how anything can – and might still – happen to Liverpool.
By INSIDER’s James Corbett
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