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"You'll Never Walk Alone, Sweet Caroline"
October 13, 2010 7:36 AM   Subscribe

It has been a dramatic start of the season for Liverpool Football Club both on and off the pitch.

A new manager has struggled to maintain his team, losing players to drama and injury and dropping games they should have won at a time they can't afford to lose points, putting the once perennial champions down in the standings and at risk for relegation.

Meanwhile, off the field, the clubs two hated American owners have until this Friday to pay back the club's massive debt or risk going into administration and taking a further 9 point penalty like what befell Portsmouth last season. Last week, light was seen at the end of the tunnel when New England Sports Ventures, owners of the Boston Red Sox, offered to buy the club for roughly 300 million pounds, wiping out its debt and putting plans in place to either restore historic Anfield or build a new stadium.

Though the club's board is in favor of the deal, the current owners are not, claiming that the estimated sale price of 300 million pounds undervalues the club. They then moved to replace members of the club's board with family and employees in order to block the sale. The case went to high court and today it was announced that the sale could go through. However, a new wrinkle developed this week when a Singapore businessman (and owner of several Manchester United themed bars) upped his own bid for the footbal club.

The reconstituted board meets tonight to assess the offers on the table, but the NESV purchase is looking more and more inevitable. But can a mashup of "You'll Never Walk Alone" and "Sweet Caroline" really work?
posted by robocop is bleeding (91 comments total) 3 users marked this as a favorite

 
I just sent a care package of Yankees gear to my Evertonian buddy.
posted by JPD at 7:39 AM on October 13, 2010 [5 favorites]


As a Red Sox and Everton fan, I'm hoping either that NESV is picking up the Reds to run them into the ground and funnel any revenue into the Sox, or that this thing gets tied up long enough for the 9 point penalty to be incurred, causing NESV to walk.
posted by .kobayashi. at 7:43 AM on October 13, 2010


All truth told, though, Henry et. al. are miles apart from Tom Hicks when it comes to sports management. I suspect that NESV could be the best possible thing to happen to Liverpool in a while. (which is precisely why I'm rooting against it.)
posted by .kobayashi. at 7:45 AM on October 13, 2010


Liverpool's main problem is debt - easily remedied. Revenue if debt free shouldn't be an issue - especially if they can get into 4th next season and qualify for CL.

But the other issue is management and personnel - and I don't see how what Henry's hires at the Sox offer a model that will work in the EPL. Henry (or one of his minions) hit on the sabermetrics/moneyball driven approach and married it to a payroll that allowed them to hold on to the talent they unearthed. You can see why this approach would have such appeal to a HF manager. It was an idea that had been kicking around for decades, but only once the A's were forced into it by circumstance was their any evidence that it worked, and then the Sox me-too'ed it.

There isn't anything like that in soccer. You can't build a quant model the isolates metrics that correlate with success like you can in baseball. I mean this doesn't mean they won't succeed but it won't be from copying the model they've got in Boston.
posted by JPD at 7:54 AM on October 13, 2010


Henry (or one of his minions) hit on the sabermetrics/moneyball driven approach...

That minion would be Red Sox General Manager, Theo Epstein. He was the first GM of a large market team to utilize principles of sabermetrics. He hired sabermetricians Bill James and Eric Van to work for the team.
posted by ericb at 8:03 AM on October 13, 2010


You can't build a quant model the isolates metrics that correlate with success like you can in baseball

Oakland A's GM Billy Beane apparently disagrees. Indeed, Charles Reep was statistically analysing football in the 1930s. Of course if Liverpool want to use that sort of model, they'll need a new manager, one who subscribes to the Pro-zone led approach to football. Please, please, please let it be Sam Allardyce.
posted by Bodd at 8:07 AM on October 13, 2010 [2 favorites]


...the sabermetrics/moneyball driven approach...

BTW -- Brad Pitt has been in town recently for filming 'Moneyball' (based on Michael Lewis' book). He portrays Oakland A's general manager Billy Beane in the film. Aaron Sorkin wrote the screenplay.

Pitt outside Fenway Park.
posted by ericb at 8:13 AM on October 13, 2010


picking up the Reds to run them into the ground

Now, I can't speak about Roush Racing nor can I comment on rendition flights, but I will say that in my lifetime prior to NESV purchasing the Red Sox, our sportsdrama team would end up as a playoff contender every 4.7 years or so, advancing to the World Series twice during that span, losing both times in very dramatic finishes. Some would say classic. We, the fans, always believed that if we could just get one more guy and not trade away our top talent that we would eventually, after eighty-something years, best our hated rivals and win the series. Of course, both ownership and management were utterly useless, baseball clubhouse lifers who could think little beyond playing out the 162 games of the regular season, so even though we'd see our teams reach the playoffs, in the back of our minds we knew that "there's always next year" when we'd get to visit the friendly confines of our small, antiquated ballpark and watch the same old faces relive the dream in second or third place.

Enter John Henry.

Granted, we didn't know much about the guy and his team, but after the Yawkey's and their custodians, anything was welcome. Top free agents were signed, the farm system was upgraded and taken seriously, they job-for-life whiners were let go and the old ballpark began to get a continuous facelift and upgrade after it was determined not to relocate the stadium. Since the new ownership took over in 2003, the Red Sox have only missed the playoffs twice, winning both the World Series' they appeared in, by crushing margins in the end but complete with plenty of drama in between. I think the NESV's track record with the Red Sox speaks for itself. They took over a consistently mediocre club and turned it into a star franchise. In the process, they maximized every revenue stream they could generate and at times one may feel like they're whoring out the old girl, but in order to be a yearly contender in this league, you have to spend the money. And to spend money, you have to make it.

It may seem to some local sports columnists that this year has been an off-season for the Sox and it may appear that John Henry and crew are setting their sights elsewhere, care-taking the Red Sox until the point of diminishing returns and eventually selling them to the next group of investors after having changed the face of the franchise forever, pink hats, luxury seats, media overexposure and all. That very well may be or it could just be that they're waiting for a new crop of very good players to come along at a discount, but one cannot say that they haven't done a lot better than many other teams in regards to fielding a competitive roster each year. It's what the fans demanded and they delivered.

Also, keep in mind that they have completely revitalized the West Fens and Kenmore Square, a deteriorating neighborhood who was subject to the whims of the old fans eighty-one days a year and visited by outsiders pretty much the same number of days. It's a different place now and for the better.

In regards to the Liverpool FC purchase once it goes through, I cannot predict the future but if my instincts are correct, this ownership group will try and squeeze every last pound they can out of the franchise while simultaneously going the extra mile to field the best team possible in order to win the Premiership every year. It's what they do, it's what they're good at and they are driven to succeed. You may not agree with everything they do, I certainly don't, but they're a focused group with a constant presence behind the team.

There are going to be some exciting times in the years to come for Liverpool fans.
posted by jsavimbi at 8:18 AM on October 13, 2010


As a Liverpool fan, I can only think that there's no possible way NESV can be worse than Hicks and Gillette.

That said, I still expect Torres to do one over the Christmas break barring a massive turnaround in the team's on-field fortunes prior to then.
posted by modernnomad at 8:21 AM on October 13, 2010


There isn't anything like that in soccer. You can't build a quant model the isolates metrics that correlate with success like you can in baseball. I mean this doesn't mean they won't succeed but it won't be from copying the model they've got in Boston.

See Why England Lose (aka Soccernomics), which discusses such issues (the book is open in its admiration for Moneyball, and its disdain for Reep (cited by Bodd, above)).
posted by Infinite Jest at 8:22 AM on October 13, 2010


I know the story of how sabermetrics got to the sox. Epstein got hired because he was a sabermetrics guy

Beane's argument is everyone uses metrics - of course they do - but that isn't the same thing as saying "we've identified a better way of measuring individual player performance in a way that correlates with run scoring". Statistically modeling baseball is actually pretty easy - it is essentially a one on one pitcher vs batter model, and the outcomes are actually pretty limited - an out, a walk or a ball hit into play - and then what happens to that ball hit into play. Soccer and basketball are utterly different. For starters its 5 vs 5 or 11 vs 11 so much much more of the probabilities you can derive are conditional upon the teammates, and then you have the added complication of a greater number of outcomes. When you are at bat there is nothing you can do that leads to the other team scoring. Guys have been trying to do this at basketball for decades and there really hasn't been any concrete evidence that it works. Baseball has had evidence since the 70's that the sabermetrics guys were on to something. I have seen some models for quarterbacks in american football that work - but those are just sort of conditional rules and basically hinge on one thing - passing the ball - and even then they have to correct the model by saying "must be seen as a high draft pick"

TL;DR - the math is much much harder for almost every sport other then baseball (and probably cricket) and they haven't "figured it out" yet
posted by JPD at 8:28 AM on October 13, 2010 [1 favorite]


its about the bookies
posted by clavdivs at 8:32 AM on October 13, 2010


They took over a consistently mediocre club

the sox have an all time winning % of .517. Only the dodgers (.524), yankees (.568) Giants (.537) and Cards (.518) have higher all time winning %'s. It only because you've always been stuck in the Yankees division that you haven't seen more post-season play.
posted by JPD at 8:37 AM on October 13, 2010


Oh the other thing that makes baseball easier to analyze is the limited possessions (in the form of outs).
posted by JPD at 8:39 AM on October 13, 2010


Combining the two most annoying support bases in all of sport!
posted by proj at 8:41 AM on October 13, 2010 [5 favorites]


In regards to the Liverpool FC purchase once it goes through, I cannot predict the future but if my instincts are correct, this ownership group will try and squeeze every last pound they can out of the franchise while simultaneously going the extra mile to field the best team possible in order to win the Premiership every year.

It will be interesting to see what happens, given they are up against the near-bottomless wallets of Chelsea and Manchester City's owners, and that Liverpool are starting from well behind those teams (and Arsenal and Man Utd). Even as a United fan, I'm pleased to see this: I didn't want to see Liverpool go into administration due to the failures of vampire owners; I want to see them beaten fairly on the field.

(By the way, in the UK it's "club"; "franchise" is used as an insult, generally only for one club).
posted by Infinite Jest at 8:43 AM on October 13, 2010 [1 favorite]


I cannot favorite proj's comment enough.
posted by JPD at 8:47 AM on October 13, 2010 [1 favorite]


you've always been stuck in the Yankees division that you haven't seen more post-season play

Around here, if you don't finish first every time, you're mediocre. The '80s and '90s were only exciting because of Roger Clemens, bless his feeble heart.
posted by jsavimbi at 8:49 AM on October 13, 2010


jsavimbi: Yes, you don't have to preach to the choir. No doubt, the JWH ownership group has been transformative for the Red Sox. It's been a wonderful boon, and I'm sure they'll bring the same energy to LFC. And that's exactly why I don't want them to take control of the Reds. I want Liverpool to fail.
posted by .kobayashi. at 8:50 AM on October 13, 2010 [1 favorite]


See Why England Lose (aka Soccernomics), which discusses such issues (the book is open in its admiration for Moneyball, and its disdain for Reep (cited by Bodd, above)).

inverting the pyramid is also quite critical of Reep - I'd imagine for the same reasons as "Why England Lose"
posted by JPD at 8:53 AM on October 13, 2010


As a Red Sox and Everton fan

.kobayashi., you mean there are two of us?

the math is much much harder for almost every sport other then baseball (and probably cricket) and they haven't "figured it out" yet

I don't think anyone disagrees that statistics are harder in sports without discrete events like baseball and cricket, but that doesn't mean it's impossible. The Houston Rockets would certainly disagree with your suggestion no one has figured it out yet for other sports.

While baseball has a distinct advantage with discrete events, I think another reason stats work in baseball is because there's so much data. And while we don't see it on this side of the pond, there's an amazing amount of data generated by football matches (like the heat maps for player positioning). The problem is (correct me if I'm wrong) most of it isn't publicly available, which limits the number of monkeys working at keyboards on the problems in a way baseball does not.
posted by yerfatma at 8:53 AM on October 13, 2010


Combining the two most annoying support bases in all of sport!

I wish the Sox had a group of Ultras throwing flares around the stands to keep ticket prices down and burn off some of the pink hats.
posted by yerfatma at 8:55 AM on October 13, 2010


heat maps for player positioning

Can you elaborate on what this means? I have no idea.
posted by josher71 at 8:56 AM on October 13, 2010


the Rockets thing has no backing for it other then them claiming they are doing it. I've never seen any data that supports a model for basketball talent evaluation. Team evaluation - yes, but not individual play.

I mean Shane Battier was drafted 6 and played on a terrible terrible team - so talented, hard worker, terrible supporting cast. Call me when someone trots out a late second rounder or free agent that exceeds expectations.
posted by JPD at 8:59 AM on October 13, 2010


There's an example here (3rd screenshot down). Shows which areas of the pitch a player spends most time.
posted by Infinite Jest at 9:00 AM on October 13, 2010


As an Arsenal fan, I have to say I'm enjoying the schadenfreude of the whole situation.
posted by 1901gunner at 9:03 AM on October 13, 2010 [1 favorite]


What's the data you are pulling out of the heat map though? (yes a big problem for sports other then baseball is the availability of data - but you've got guys who are crazy enough they they'll go back watching 20 years of games to collect the data that they need.)
posted by JPD at 9:04 AM on October 13, 2010


they are up against the near-bottomless wallets of Chelsea and Manchester City's owners

They also have the problem of not just competing at a league level, but also having to compete against all of the other top teams in the European leagues. As a lifelong Real Madrid supporter, I understand the need for deep pockets.
posted by jsavimbi at 9:05 AM on October 13, 2010


Another excuse to post Wylie. Say Wah!
posted by PeterMcDermott at 9:07 AM on October 13, 2010


I've liked EPL for about 6 years now. Living in the Boston area (again), this makes me a bit of an oddity. Well, moreso than otherwise. The main problem for me is that I haven't had a reason to like one team more than another, other than a vague anti-Yankees-always-winning feeling I've had towards the Big Four.

I can't wait for them to start playing Sweet Caroline during stoppage time. =)
posted by andreaazure at 9:16 AM on October 13, 2010


As a lifelong Real Madrid supporter, I understand the need for deep pockets.

And also the need to have something more intangible than deep pockets, considering they haven't progressed past the second round of the Champions' League since 2004.
posted by kersplunk at 9:25 AM on October 13, 2010 [1 favorite]


they are up against the near-bottomless wallets of Chelsea and Manchester City's owners


This won't be a problem, because of the "break even" rules being introduced. Essentially, Man City may be prohibited from playing in the Champions Leage, and are in a race against time to buy all their players and make the initial investment before having to both cut their wage bill and increase their revenue. Liverpool have actually increased their revenue since Hicks and Gillett took them over, it's just that the payments servicing the debt were taking all the profit. Man U are in dire straits - the Glazers can essentially use any profits as a private slush fund, as well as the obvious debt payments.

In short, should the takeover of Liverpool remove the debt, then they will be in a very strong position - they're revenue is (I believe) 4th in the UK, and with a few additions to the squad they'll be doing well (really, they just needed to keep hold of Xabi Alonso, but hey).
posted by djgh at 9:29 AM on October 13, 2010 [1 favorite]


I predict the breakeven rule will be shot down by the EU
posted by JPD at 9:42 AM on October 13, 2010 [1 favorite]


As a follow-up to this AskMe, it's pretty obvious I'm heading Red. It started with the whole Mascherano drama earlier in the season. I picked him for the Mefi Fantasy league based on the fact he played for Argentina in the World Cup and had an extremely goofy player picture (imagine a man shitting out a potato. image the look on his face. that was his picture) and kept reading reading reading about his place in the club, which got me interested in how the rest of the club works, which actually has taught me a lot about tactics.

(Also Ngog sounds like a Jack Kirby villain from his Weird Science days. The cover has a 500 foot tall fire breathing Frenchmen towering over a quailing crowd. "Can None Stop NGOG??!" the exploding caption reads. (And as it turns out, it doesn't take much to stop Ngog) )

So with Liverpool's current slump, I don't get that feeling of bandwagoning most Americans seem to worry about when they start looking around at EPL teams. As MeFi's Own Kattullus points out, rooting for the underdog is pretty well ingrained into our psyche.
posted by robocop is bleeding at 9:42 AM on October 13, 2010


djgh: In short, should the takeover of Liverpool remove the debt, then they will be in a very strong position - they're revenue is (I believe) 4th in the UK, and with a few additions to the squad they'll be doing well (really, they just needed to keep hold of Xabi Alonso, but hey).

That's true, they are fourth in the Deloitte 2010 football money list (free registration required to download PDF) among English teams. However, they aren't in the Champions League this year - that's going to lead to an immediate drop in broadcasting revenue, along with (presumably) match-day revenue. It's early yet, but they also aren't looking like reaching the Champions League this season: if that happens, then their revenue's just dropped for two of the years in the lead-up to the introduction of the financial fair-play rules. Not only that, but the revenue for Tottenham and possible another team has increased due to their Champions League participation.

I think it's highly unlikely that Man City will not comply with those rules and be denied entry to the Champions League, should they qualify. Liverpool are not in a terrible position - arguably, thanks to the change in owners, they are in a better long-term position than Man Utd - but it's not especially strong.

(And, of course, Arsenal appear to be in a better long-term position than Man Utd as well - hasn't helped them much in the last couple of seasons.)
posted by smcg at 9:53 AM on October 13, 2010


As a Man Utd fan who works with a bunch of Liverpool fans, I'm with 1901gunner in enjoying every minute of this.

I also understand the sign at John Lennon Airport in Liverpool has been changed so it no longer reads "Above us only sky". It now says "Below us only Wolves and West Ham"
posted by essexjan at 10:23 AM on October 13, 2010 [9 favorites]


As a Man Utd fan who...

posted by essexjan at 6:23 PM on October 13 [+] [!]

I see you're from the traditional catchment area...


I kid, I kid!
posted by littleredspiders at 10:43 AM on October 13, 2010 [4 favorites]


What can I say? I was born in Australia, grew up in Derby and have lived in Essex for 30+ years. Who else could I possibly support?!
posted by essexjan at 11:01 AM on October 13, 2010 [1 favorite]


This won't be a problem, because of the "break even" rules being introduced.

I'm sceptical of this ever being enforced, to be honest. The EU might prevent it, as JPD suggests. Even if they don't, UEFA are a bunch of spineless swine, who will probably fail to enforce any penalties on clubs like Chelsea, Real (and maybe City). Too, City and Chelsea have already spent massively, they don't need to keep spending. Liverpool need most of a new team (even if Torres stays, he's injured half the time. I'd take Gerrard and Reina but few others from that team).

I also understand the sign at John Lennon Airport in Liverpool has been changed so it no longer reads "Above us only sky". It now says "Below us only Wolves and West Ham"

Flagged as fantastic.
posted by Infinite Jest at 11:02 AM on October 13, 2010


As a Liverpool fan, I can only think that there's no possible way NESV can be worse than Hicks and Gillette.
Ditto this. Heck, just about anyone with decently deep pockets taking the club away from Hicks and Gillette would be an improvement.
posted by juv3nal at 11:35 AM on October 13, 2010


As an Arsenal supporter, I am secretly disappointed that the sale will go through. As a Leafs fan, I am relatively ambivalent about the whole situation.
posted by TheWhiteSkull at 11:52 AM on October 13, 2010


The best thing about today as pointed out by the Guardian.

Thatcher is going to spend her 85th Birthday seeing nothing but celebrating scousers and miners.
posted by fullerine at 11:57 AM on October 13, 2010 [9 favorites]


Up the Villa!
posted by the_very_hungry_caterpillar at 12:04 PM on October 13, 2010


As a Red Sox and Everton fan

Yankees and Liverpool fan here... so conflicted (and yet hugely supportive, because anything that gets rid of Hicks and Gillette is a good thing).

One interesting thing I read, and frankly I have no idea the truthiness -- basically NESV could use any Liverpool losses/debt (new stadium?) to decrease NESV's overall profits, which then reduces the amount they pay in MLB revenue sharing dollars. BUT, like I said, I don't know how all that stuff works; I'd be interested if anyone does.
posted by inigo2 at 1:43 PM on October 13, 2010


I would be shocked if they were allowed to do that. I also doubt they would want to do that. It would make securing loans against either club virtually impossible. It was also create all kinds of complications if you tried to sell either club. Not just that but if things went really south and the assets were collateralized against one another you would risk both being lost.


Usually the way you reduce profits in MLB is by artifically deflating revenues (see owning concessions business you undercharge, below market TV deal with channel the ownership group also owns) or accelerate the depreciation on contracts.
posted by JPD at 2:23 PM on October 13, 2010


Thanks! That's the type of response I wanted to hear!
posted by inigo2 at 2:47 PM on October 13, 2010


A new twist! - A Texas court has granted a temporary restraining order stopping the sale of Liverpool Football Club, owners Tom Hicks and George Gillett have claimed.
posted by robocop is bleeding at 3:00 PM on October 13, 2010


A Texas court has granted a temporary restraining order stopping the sale of Liverpool Football Club

Oh what fresh hell is this?
posted by modernnomad at 4:10 PM on October 13, 2010 [1 favorite]


Pretty Amazing

Update at 4:54 p.m.: I just spoke with Stodghill, who says his office is being "innundated with angry e-mails from Liverpool fans." I asked him: How does a Dallas court have jurisdiction over proceedings initiated in the U.K. He says: Royal Bank of Scotland is registered to do business in the state of Texas; and, of course, New England Sports Ventures is U.S. based. Also being sued is Liverpool chairman Martin Broughton. And, says Stodghill, "We allege in the lawsuit he committed some of his tortuous acts in Texas in meetings with Mr. Hicks, so we're suing him in part based on conduct here that did harm to Texas residents."
posted by JPD at 4:26 PM on October 13, 2010


The whole thing is pretty interesting though - essentially what has happened is that for some reason despite owning all of the clubs equity Gillett and Hicks only had 2 of the 5 seats on the board. No idea what the history of that is but certainly the set themselves up to get screwed if things went south.
posted by JPD at 4:28 PM on October 13, 2010


I just want to note that I love the title of this post: "You'll Never Walk Alone, Sweet Caroline".

Also, as a Bostonian who supports Everton I'm not sure what to make of this although I think it's generally positive.
posted by Rarebit Fiend at 4:53 PM on October 13, 2010


Okay, that latest Texas twist strikes me as totally hilarious.
posted by .kobayashi. at 7:47 PM on October 13, 2010


That Texas thing is completely ridiculous, because there's no way a Texas court could have jurisdiction in this case. The agreement between RBS and Kop Football (Hicks and Gillett) would have clauses stating the law that governed the agreement, and where disputes would be settled (jurisdiction). That's just basic. And those courts, that jurisdiction, would be those of England and Wales [RBS has the power in this situation, they are absolutely going to choose their own courts].

Robocop is bleeding's link explains it though: "BBC Business Editor Robert Peston reported: "Although the Texas court has no direct jurisdiction in the UK, both New England Sports Ventures and Liverpool's bankers, Royal Bank of Scotland, would not wish to be seen to be wilfully defying that court, because that could cause harm to their substantial US operations
"
So if I read it right, RBS would need to go back to the English court to have them strike down the Texas claim.

But even if the Texan claim did hold: Kop Football's loan from RBS is due to be repaid tomorrow. They can't repay it. So RBS could just put Kop Football into administration, take the club, and sell it to NESV. (I wouldn't be surprised if they already have the draft documents prepared, to do just that).
posted by Infinite Jest at 12:22 AM on October 14, 2010


The whole thing is pretty interesting though - essentially what has happened is that for some reason despite owning all of the clubs equity Gillett and Hicks only had 2 of the 5 seats on the board. No idea what the history of that is but certainly the set themselves up to get screwed if things went south.

Briefly: they were having problems with the debt. RBS agreed an extension to the debt*, on condition that RBS got to appoint a new chairman (Broughton). This current dispute boils down to: the other three agreed the sale to NESV. Hicks and Gillett sacked the other two board members (other than Broughton) and appointed new board members, who voted against the sale. RBS and Broughton argued that H & G couldn't sack them. So it went to court, and RBS won (yesterday).

*Or something similar - something to help out H&G rather than put the club into administration.
posted by Infinite Jest at 12:25 AM on October 14, 2010


Hicks and Gillet are just incredible. How on earth do they justify their actions?
posted by kkrvgz at 3:08 AM on October 14, 2010


FUCK TEXAS.
posted by inigo2 at 4:48 AM on October 14, 2010


Seriously. At this point they're just having a temper tantrum. Hell, they are actually working against their own interests! If their argument is that the club is undervalued and their goal is to get as much money as possible from the sale, how the hell does it help them to have it go into administration, take the 9 point hit, and likely end up relegated, which reduces its value?

And where the hell were these 400 million pound offers in the summer? I somehow doubt that these offers are actually real, more just smokescreens put out by G+H's buddies to give them a leg to stand on.
posted by robocop is bleeding at 4:56 AM on October 14, 2010


Also, here's the restraining order.
posted by robocop is bleeding at 4:57 AM on October 14, 2010


So it looks like G+H are out, with Mill Financial taking the rest of the pair's shares, possibly buying time for some other, outside investor. If Mill can pay off RBS, then the deal with NESV will fall through, freeing them to sell to another buyer. This makes the Texas injunction a delaying action.
posted by robocop is bleeding at 5:14 AM on October 14, 2010


I just came in here to post that. I think robocop is right, it was a delaying action to enable the hedge fund to take over. Otherwise, there didn't seem any point in the injunction, other than to maybe annoy RBS and possibly hurt the new owners by putting the club into administration.

Here's Football365 on the injunction: "each piece of evidence for the granting of the order is prefixed 'Based on the allegations...' of Hicks and co., and the judge has scrawled 'solely' after every instance of the word 'Based'...RBS, Martin Broughton et al are accused of 'unlawful acts' in the original text, only for the judge to scribble out the word 'unlawful'. So just 'acts', then. And in the summary of the final orders, the instruction for the defendants to refrain from 'Taking any action in any other court to effect or impede this lawsuit' is scrubbed out altogether."
posted by Infinite Jest at 5:21 AM on October 14, 2010


to be fair to G + H it does seem inappropriate that the chairman appears to be doing the debtholders bidding. I have professionally been on the other side of the (bank groups paying off the executives to file bankruptcy by promising them bigger equity grants in the post-reorg company) and it really is tantamount to theft. Additionally the TRO implies G +H tried to fire the two other board members - something that they legally have the right to do as owners of all the equity - but there is a question as to the procedure for replacing them - so basically this all lies on that issue. Basically these guys may be terrible people and shitty owners - but they are getting fucked and you cannot deny that. You might not care in this case but it is a poor precedent.

RBS should just be the bad guy and foreclose.
I guess the externality is the points penalty - would that be enough to guarantee relegation?
posted by JPD at 5:23 AM on October 14, 2010


Infinite Jest - pretty sure those edits are a question of legalese not substantiative
posted by JPD at 5:25 AM on October 14, 2010


Well, if Liverpool has 6 points now from 7 games played, that means they have 31 games to go. Assuming they need 40 points or so to avoid relegation, that means if they take the administration penalty of 9 points, they need 43 points over the next 31 games. So that means they need to win, what, 5 games (15 points) and tie the other 26 (26pts) for 41 points.

Given their form so far this year, it's possible, but it would be a bloody dogfight. If there are indeed new owners lurking in the wings, they'd need to spend deep and well come January.
posted by robocop is bleeding at 5:36 AM on October 14, 2010


Giggle- Liverpool Football Club is currently owned by a right-wing christian conservative hard dollar lender from DC. Hillarious

http://springfieldfinancialco.com/causes.aspx
posted by JPD at 5:38 AM on October 14, 2010


JPD: to be fair to G + H it does seem inappropriate that the chairman appears to be doing the debtholders bidding.

I bow to your knowledge on the Texas edits, but with regard to the chairman:

"R [RBS] and X [Hicks/Gillett] agreed to enter into a refinancing agreement. X covenanted, inter alia, to (i) sell the club; (ii) allow the sale of the club to be negotiated by Y's board of directors, acting under a third party chairman; (iii) execute a new corporate governance structure in respect of Y [the holding companies of Liverpool FC], which required X to divest their controlling interest in Y."

(From the Lawtel summary; judgment isn't out on the free web yet)

So, as I'm reading it, in order to avoid RBS calling in the debt previously, H&G had agreed to the appointment of Broughton as chairman. He's there to sell the club, and get the best price for it. H&G refused to go along with the board's decision that the NESV deal was the best deal.
posted by Infinite Jest at 5:47 AM on October 14, 2010


it does seem inappropriate that the chairman appears to be doing the debtholders bidding.

I would actually say (from what I know) that it looks like the chairman appears to be doing what's best for the club and the business, just not for Hicks and Gillette.

Basically these guys may be terrible people and shitty owners - but they are getting fucked and you cannot deny that.

I sure can. Hicks tried to screw up the sale of the Texas Rangers, and failed. I can only hope he fails again.
posted by inigo2 at 5:55 AM on October 14, 2010


Or maybe Hicks has not sold out after all...
posted by robocop is bleeding at 6:16 AM on October 14, 2010


The chairman is just one member of the board. In theory the other two members of the board have a fiduciary responsability to the equity holders (there are no independent equity holders so you can't argue that they are acting in their interest). X isn't contesting a sale, it is contesting this sale saying the board did not maximize value. I believe they are also accusing Broughton acting on behalf of RBS of not being interested in a sale that implies any value to X's equity. There are 5 members on the board - and Broughton is supposed to be acting independently not in RBS's interest.

I would actually say (from what I know) that it looks like the chairman appears to be doing what's best for the club and the business, just not for Hicks and Gillette.


Unfortunately that's not the boards responsibility - they are supposed to be doing what is best for the equity holders - Hicks and Gillett
posted by JPD at 6:29 AM on October 14, 2010


ii) allow the sale of the club to be negotiated by Y's board of directors, acting under a third party chairman;

This is the sticking point BTW - in the US (or at least most states where the bulk of companies are incorporated) this statement requires you to seek the best price. I'm not intimately familiar enough with UK board rules to know if the same applies there.
posted by JPD at 6:31 AM on October 14, 2010


Huh. H+G's lawyers have not turned up in High Court today regarding the Texas injunction.

Plus, Peter Lim may have pulled out.
posted by robocop is bleeding at 6:33 AM on October 14, 2010


Unfortunately that's not the boards responsibility - they are supposed to be doing what is best for the equity holders - Hicks and Gillett

Well, crap. That's unfortunate. Guess I'll just sit back, cross my fingers, and stop talking about things I do not know. (Thanks for your insight here, appreciate it.)
posted by inigo2 at 6:52 AM on October 14, 2010


Does anyone else, in their heads, picture Tom Hicks as looking and talking almost exactly like Yosemite Sam?
posted by .kobayashi. at 6:56 AM on October 14, 2010 [1 favorite]


Whoops, looks like H+G's lawyers are in Texas arguing that the board was in contempt of court yesterday.
posted by robocop is bleeding at 7:02 AM on October 14, 2010


Does anyone else, in their heads, picture Tom Hicks as looking and talking almost exactly like Yosemite Sam?


Unfortunately he has a pretty moderate Texas accent. (I always run with Foghorn Leghorn "I say I say Boy")
posted by JPD at 7:07 AM on October 14, 2010


Judge rules that anti-suit injunction wanted by RBS and other parties (board) against owners action in Texas is granted. "This case has nothing to do with Texas."
posted by robocop is bleeding at 9:25 AM on October 14, 2010


Heh, you mean a case where all the parties are English*, concerning assets in England, should be decided by the English courts? (Not the "British" courts, as the court in Texas seemed to think).

*Kop Holdings and Kop Holdings (Football) are incorporated in England.

Guardian live blog reporting Hicks still owns shares in club; Liverpool fans want to launch a class action against H&G, UK lawyers unsure if RBS can put club into administration tomorrow. Also that English judge says H&G had obviously been preparing Texas case for some time. And that H&G lawyers were out of the office all afternoon, instead of appearing in court.
posted by Infinite Jest at 9:34 AM on October 14, 2010


But you don't understand! Sometimes the Boston Red Sox play baseball in Texas, so obviously Texas has jurisdiction!*

* This is a real argument used by G+H in their Texas Injunction
posted by robocop is bleeding at 9:45 AM on October 14, 2010


Yeah I'm no lawyer but its hard to see Texas having anything to do with this

RBS should just foreclose. You think Hicks is hated now wait till Liverpool is docked points.
posted by JPD at 9:51 AM on October 14, 2010


RBS should just foreclose. You think Hicks is hated now wait till Liverpool is docked points.

But RBS has no interest in how much Hicks is hated -- in fact, they have only an interest in selling the club and recouping their investment. If they foreclose and the club goes into administration and is docked points, it will make selling the club much harder.
posted by proj at 9:56 AM on October 14, 2010


I know that. I wasn't implying that's why RBS should foreclose. The should foreclose because then it makes their legal control over the situation much stronger.

But its a discrete thing - at this point missing CL is probably a foregone conclusion. If L'pool were clear of the relegation zone regardless of the penalty RBS would doubtless have foreclosed because that wouldn't actually impair the franchise's enterprise value - in fact it might allow them to get rid of some other liabilities they don't want or need. The problem is that if they do go into administration and they do get relegated then they are worth less.

The flip side is that if G + H really were confident that the EV>the debt outstanding they actually should have a better outcome in administration then in a sale to NESV.
posted by JPD at 10:04 AM on October 14, 2010


The saga continues. The restraining order is lifted/about to be lifted, but not so NESV can complete the purchase. Instead, it's so Hicks can unload his shares to Mills Financial who already own his partner's shares due to a previous default.

It's going to be a race to the bank.
posted by robocop is bleeding at 4:42 AM on October 15, 2010


Looks like Hicks has pulled out and is threatening damages and lawsuits again. NESV should be announcing the purchase soon.
posted by robocop is bleeding at 5:56 AM on October 15, 2010


Interesting --

"There are strong connections between Tom Hicks and the Texas judge Jim Jordan, which might explain the ease with which the discredited Liverpool owner was granted the temporary restraining order - described as ‘outrageous’ in the High Court yesterday - that held up the NES V takeover.

Vester Hughes, head partner of law firm K & L Gates LLP, who helped bankroll District Court Judge Jordan’s failed campaign to win a seat on the Texas Supreme Court, is a director colleague of Hicks on a number of organisations including the Dallas Civic Leaders Council and Dallas Museum of Art. "

[via]
posted by inigo2 at 6:46 AM on October 15, 2010


It's done!
posted by robocop is bleeding at 7:58 AM on October 15, 2010


It's done!

Oh, fiddlesticks! I was so hoping for the 9 point penalty.
posted by .kobayashi. at 8:47 AM on October 15, 2010


Infinite Jest: I'm sceptical of this ever being enforced, to be honest. The EU might prevent it, as JPD suggests.

How would they go about doing this? It doesn't prohibit free movement of goods or services, and it's not a competition issue.
posted by djgh at 9:08 AM on October 15, 2010


It doesn't prohibit free movement of goods or services Creates a de facto salary cap so yes it does limit the free movment of services - in this case players and the price they charge for their service.

Same line of thought that has prohibited salary caps - usually the argument is made on an accusation of collusion.
posted by JPD at 9:31 AM on October 15, 2010


Also it is a competition issue because it essentially locks relative revenues in place - you can't try to gamble with your equity to build up a club to in hopes of qualifying for CL and getting on tv more.
posted by JPD at 9:32 AM on October 15, 2010


Oh, fiddlesticks! I was so hoping for the 9 point penalty.

Yes me too. DAMN.
posted by ob at 10:29 AM on October 15, 2010


> I also understand the sign at John Lennon Airport in Liverpool has been changed so it no longer reads "Above us only sky". It now says "Below us only Wolves and West Ham."

Fixed to reflect today's results at Goodison.
posted by .kobayashi. at 7:56 AM on October 17, 2010 [2 favorites]


"Ferry Cross That Dirty Water" would be a good mashup too.
posted by Rarebit Fiend at 10:46 AM on October 17, 2010


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