Music to Liverpool fans' ears: debt cleared, funds for the squad
Liverpool fans have lost their fear that the club may be substituting one grim set of Americans for another just as damaging
Sat 16 Oct 2010 04.00 EDT First published on Sat 16 Oct 2010 04.00 EDT
Liverpool FC's new owner, John W Henry of NESV, with the Liverpool chairman, Martin Broughton. Photograph: Fiona Hanson/PA
New England Sports Ventures made the promises expected of all new football club owners yesterday – even John Henry's crowd-pleasing pledge to "return the club to greatness on and off the field" was still not as grand as the ones Tom Hicks and George Gillett rolled out when they rode into Anfield.
Liverpool supporters, however, during the toe-to-toe battle waged against Hicks and Gillett since the board unveiled NESV as its preferred bidders 10 tumultuous days ago, lost their initial fear that the club may be substituting one grim set of Americans for another just as potentially damaging.
The key reason is that from the outset NESV has pledged categorically to remove all Hicks's and Gillett's "acquisition debt" from the club. That is the £185m, now grown to £200m, the pair borrowed from Royal Bank of Scotland to buy the club in February 2007, then made it the club's responsibility to repay.
Yesterday, among the general statements of strategy, that NESV will "listen" to Roy Hodgson – to whom the new owners have offered patience – players, staff, "fans, local leaders and the local community", was that single solid commitment. "The transaction values the club at £300m and eliminates all of the acquisition debt placed on LFC by its previous owners," it said, "reducing the club's debt servicing obligations from £25m-£30m a year to £2m-£3m."
In answer to understandable scepticism given the experience with Hicks and Gillett who made a similar promise, NESV has clarified it. No debt will be loaded on to the club, and no money will be taken out of the club, in any way, to service their cost of buying it. That is a clear pledge to which they can now be held accountable for honouring.
NESV was careful not to put figures on how much it will make available to invest beyond the £300m to meet the club's debts. However, Martin Broughton, Liverpool's chairman, made it clear during last week's onslaught against Hicks and Gillett that NESV will look to boost the thinned-out playing squad.
Broughton pointed out that paying off Hicks's and Gillett's acquisition debt, and removing the £25m-£30m interest costs, frees that money for use on the team. "In terms of paying down all the burden of debt they have committed in this proposal to major playing investment," he said. "They are not going to say an amount, which I think is very sensible, but it backs up their commitment to development on the playing side, and commitment to building a new stadium."
In relation to the stadium, NESV is on a potential collision course with Liverpool City Council which wants the new owners to remain committed to a new stadium on Stanley Park, and the new development, "Anfield Plaza", on the site of the current ground, planned to create jobs in the intensely deprived local area.
However, Henry repeated yesterday what he has said since the start, that NESV will "carefully study the various long-term options," which includes redeveloping Anfield, as they did at Fenway Park, the Boston Red Sox ground, rather than relocating.
For those seeking a guide to how NESV will go about the club's resurrection, sources pointed constantly to their record at the Red Sox. Before the takeover by Henry and his 16 associates in NESV in 2001, the Red Sox had not won a World Series since 1918, but they did so within three years, then won it again in 2007. NESV has substantially developed Fenway Park into a quality 37,000-seat ground, although the one note of caution in the glee enveloping Anfield is that NESV's style of "enhancing the fan experience" has included steep ticket price rises.
Significantly for a set of supporters traumatised by the leveraged chicanery of Hicks and Gillett, NESV has made it known that it has never taken a dividend payment out of the Red Sox in nine years.
Henry's pledge to listen to fans will be eagerly accepted by supporters' groups, which, while fiercely campaigning against Hicks and Gillett, have been making plans to raise money and seek a partnership with whoever replaced the pair. Last week Purslow said he had asked NESV to engage with supporters. "To consider a scheme that will give our fans a real sense of ownership – NESV has told us it will look at this very seriously."
Yesterday James McKenna, the spokesman for Spirit of Shankly-ShareLiverpoolFC, welcomed that prospect. "We have been completely alienated, but have pledges for significant money from fans. We will be seeking a serious conversation with the new owners to explore how we can work together."
Thus the new dawn finally broke at Anfield, with owners removing debt, not loading it on, and promising to rebuild the club for the long term, while working with supporters. That is the ownership ethos which a great, battered club, and English football more generally, desperately needs.
John W Henry
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