According to the media, Tom Hicks and George Gillett have invested £144m into Liverpool FC since 2007.. £144m is the magic number, and it has been repeated in almost every newspaper, blog and news program worldwide over the last couple of weeks. However, as I will illustrate, that figure is not even correct (!), and not a single journalist on the planet has got it right yet.
Sounds hard to believe, right? Well, it's not. When it comes to LFC's finances, the press has *repeatedly* got it wrong, and this is yet another example of that.
FROM WHAT SOURCE DID THE £144m FIGURE ORIGINATE?
As far as I can tell, the figure originated in an article written by excellent football journalist David Conn for The Guardian on October 6th. In the article, Mr Conn stated:
"The deal with [John W] Henry...leaves no room for the repayment of the loans which Hicks and Gillett made to Liverpool, which stood at £144m on 31 July 2009, the date of the club's last published accounts".
Every newspaper under the sun (and every LFC website/blog etc) then copied that figure, including the Telegraph, The Daily Mail and a whole host of others.
The fact is Hicks and Gillett have NOT invested £144m into the club itself. The correct figure can be established by tracing all the loans to the club from Kop Football Ltd over the last 3 years. Before I get to that though, it is important to appreciate the overall structure of LFC, and how money from Hicks and Gillett filters through to the club:
STRUCTURE OF LFC
Kop Investment LLC (KI)
An American company, co-owned by Gillett & Hicks. This owns:
Kop Football (Cayman) Ltd (KFCL)
A company registered in the Cayman Islands. This owns:
Kop Football (Holdings) Ltd. (KFHL)
A UK holding company. This owns:
Kop Football Ltd (KFL)
Another UK holding company. This owns:
Liverpool Football Club & Athletic Grounds Ltd (LFCAGL).
This is the club itself.
WHERE HAVE THE LOANS COME FROM?
Money has filtered down from KI all the way down to the club (LFCAGL). This is the process:
1. KI loans money to KFCL
2. KFCL loans money to KFHL
3. KFHL loans money to KFL
4. KFL loans money to LFCAGL
Step 4 is what this article is about, i.e. establishing the true amount of money loaned to the club by KFL.
LOAN #1: 2007
KFL loaned the club £64m. (Below = Snippet from KFL's accounts):
*Click to enlarge images
LOAN #2: 2008
KFL loaned the club more money, with the total owed now standing at £79.9m. (Below = Snippet from KFL's accounts):
The actual amount loaned in 2008 is not revealed, however we know that a loan WAS made because the following is stated: "The company continues to loan funds to the club on an as-needed basis".
LOAN #3: 2009
KFL loaned the club more money, with the total owed now standing at £100.8m. (Below = Snippet from KFL's accounts):
This figure is confirmed by LFC's last published accounts, dated 31 July 2009 (Below = Snippet from LFCAGL's accounts):
Look again at Mr Conn's comments in the Guardian article:
"The deal with [John W] Henry...leaves no room for the repayment of the loans which Hicks and Gillett made to Liverpool, which stood at £144m on 31 July 2009, the date of the club's last published accounts".
As you can quite clearly see, this is wrong. On the 31 July, loans made to Liverpool by Hicks and Gillett stood at £100.8m, not £144m. Even if we take into account any amounts due within a year of 31 July, it still doesn't amount to £144m (Below = Snippet from LFCAGL's accounts):
If we include the £20m highlighted above, that would make the total figure owed to KFL £120m.
What's happened here is simple: The Guardian (and seemingly the rest of the football media) has misread/misinterpreted LFC's accounts. If we look at KFHL's accounts for 2009, we discover the following:
The £144m figure has been taken from the wrong set of accounts! As you can see:
* Kop Cayman loaned Kop Football (Holdings) Ltd £144.4m.
* £144.4m. may well have been loaned from KFCL to KFHL (i.e. Hicks and Gillett loaning money to themselves), but until the money filters down to LFCAGL, it is not a loan to the club.
* Only £100.8m made its way down to the club.
* This is the figure owed to KFL from the club
DISTINCTION BETWEEN THE CLUB + HOLDING COMPANY?
This is important because Hicks and Gillett can only claim their money back from the club (That is, if the loan has not been converted into equity already) Since the club only received £100.8m, this is the figure that matters. Other things to consider:
* H+G own the Holding Companies - they're not going to take their own companies to court to get their money back, are they?!
* LFCAGL existed before H+G came on the scene; the holding companies did not (in their current form).
* Whether we like it or not, H+G lent Liverpool £100m - they are entitled to claim that money back, just like any other loan (again, if the loan has not been converted into equity).
H+G's situation is similar to RBS' situation:
* RBS loaned Hicks and Gillett money under a loan agreement
* Now they want it back, and they're entitled to repayment.
* H+G loaned Liverpool (LFCAGL) money under a loan agreement.
* They will want it back, and under the loan agreement, they're entitled to call in the loans.
The idea that they will 'lose' that money is fanciful at best. If the sale to NESV goes through, and the loans are still outstanding (i.e. not converted into equity) Hicks and Gillett will simply go to the courts and start an action for repayment of that money loaned to Liverpool
ULTIMATELY, WHY DOES IT MATTER?
I guess it doesn't in the grand scheme of things (unless you're interested in true facts about the club, that is!). However, should we not expect a rudimentary amount of accuracy from newspapers like The Guardian and the Telegraph? This kind of inaccuracy irritates me because it very quickly becomes accepted fact, and then gets repeated across the globe without anyone bothering to conduct even rudimentary fact-checking.
The rampant perpetuation of this kind of inaccuracy is one of the things that prompted me to start this site in the first place. I got fed up with reading sloppily researched articles in the press, which often led to people parroting incorrect facts and figures during discussions about LFC.
I highlight this issue because it is vitally important that fans have access to correct information in order to make an informed choice.
NB. This is not a pro-Hicks article (!) - It's anti-media inaccuracy, and that's it.
Jaimie Kanwar
Sounds hard to believe, right? Well, it's not. When it comes to LFC's finances, the press has *repeatedly* got it wrong, and this is yet another example of that.
FROM WHAT SOURCE DID THE £144m FIGURE ORIGINATE?
As far as I can tell, the figure originated in an article written by excellent football journalist David Conn for The Guardian on October 6th. In the article, Mr Conn stated:
"The deal with [John W] Henry...leaves no room for the repayment of the loans which Hicks and Gillett made to Liverpool, which stood at £144m on 31 July 2009, the date of the club's last published accounts".
Every newspaper under the sun (and every LFC website/blog etc) then copied that figure, including the Telegraph, The Daily Mail and a whole host of others.
The fact is Hicks and Gillett have NOT invested £144m into the club itself. The correct figure can be established by tracing all the loans to the club from Kop Football Ltd over the last 3 years. Before I get to that though, it is important to appreciate the overall structure of LFC, and how money from Hicks and Gillett filters through to the club:
STRUCTURE OF LFC
Kop Investment LLC (KI)
An American company, co-owned by Gillett & Hicks. This owns:
Kop Football (Cayman) Ltd (KFCL)
A company registered in the Cayman Islands. This owns:
Kop Football (Holdings) Ltd. (KFHL)
A UK holding company. This owns:
Kop Football Ltd (KFL)
Another UK holding company. This owns:
Liverpool Football Club & Athletic Grounds Ltd (LFCAGL).
This is the club itself.
WHERE HAVE THE LOANS COME FROM?
Money has filtered down from KI all the way down to the club (LFCAGL). This is the process:
1. KI loans money to KFCL
2. KFCL loans money to KFHL
3. KFHL loans money to KFL
4. KFL loans money to LFCAGL
Step 4 is what this article is about, i.e. establishing the true amount of money loaned to the club by KFL.
LOAN #1: 2007
KFL loaned the club £64m. (Below = Snippet from KFL's accounts):
*Click to enlarge images
LOAN #2: 2008
KFL loaned the club more money, with the total owed now standing at £79.9m. (Below = Snippet from KFL's accounts):
The actual amount loaned in 2008 is not revealed, however we know that a loan WAS made because the following is stated: "The company continues to loan funds to the club on an as-needed basis".
LOAN #3: 2009
KFL loaned the club more money, with the total owed now standing at £100.8m. (Below = Snippet from KFL's accounts):
This figure is confirmed by LFC's last published accounts, dated 31 July 2009 (Below = Snippet from LFCAGL's accounts):
Look again at Mr Conn's comments in the Guardian article:
"The deal with [John W] Henry...leaves no room for the repayment of the loans which Hicks and Gillett made to Liverpool, which stood at £144m on 31 July 2009, the date of the club's last published accounts".
As you can quite clearly see, this is wrong. On the 31 July, loans made to Liverpool by Hicks and Gillett stood at £100.8m, not £144m. Even if we take into account any amounts due within a year of 31 July, it still doesn't amount to £144m (Below = Snippet from LFCAGL's accounts):
If we include the £20m highlighted above, that would make the total figure owed to KFL £120m.
What's happened here is simple: The Guardian (and seemingly the rest of the football media) has misread/misinterpreted LFC's accounts. If we look at KFHL's accounts for 2009, we discover the following:
The £144m figure has been taken from the wrong set of accounts! As you can see:
* Kop Cayman loaned Kop Football (Holdings) Ltd £144.4m.
* £144.4m. may well have been loaned from KFCL to KFHL (i.e. Hicks and Gillett loaning money to themselves), but until the money filters down to LFCAGL, it is not a loan to the club.
* Only £100.8m made its way down to the club.
* This is the figure owed to KFL from the club
DISTINCTION BETWEEN THE CLUB + HOLDING COMPANY?
This is important because Hicks and Gillett can only claim their money back from the club (That is, if the loan has not been converted into equity already) Since the club only received £100.8m, this is the figure that matters. Other things to consider:
* H+G own the Holding Companies - they're not going to take their own companies to court to get their money back, are they?!
* LFCAGL existed before H+G came on the scene; the holding companies did not (in their current form).
* Whether we like it or not, H+G lent Liverpool £100m - they are entitled to claim that money back, just like any other loan (again, if the loan has not been converted into equity).
H+G's situation is similar to RBS' situation:
* RBS loaned Hicks and Gillett money under a loan agreement
* Now they want it back, and they're entitled to repayment.
* H+G loaned Liverpool (LFCAGL) money under a loan agreement.
* They will want it back, and under the loan agreement, they're entitled to call in the loans.
The idea that they will 'lose' that money is fanciful at best. If the sale to NESV goes through, and the loans are still outstanding (i.e. not converted into equity) Hicks and Gillett will simply go to the courts and start an action for repayment of that money loaned to Liverpool
ULTIMATELY, WHY DOES IT MATTER?
I guess it doesn't in the grand scheme of things (unless you're interested in true facts about the club, that is!). However, should we not expect a rudimentary amount of accuracy from newspapers like The Guardian and the Telegraph? This kind of inaccuracy irritates me because it very quickly becomes accepted fact, and then gets repeated across the globe without anyone bothering to conduct even rudimentary fact-checking.
The rampant perpetuation of this kind of inaccuracy is one of the things that prompted me to start this site in the first place. I got fed up with reading sloppily researched articles in the press, which often led to people parroting incorrect facts and figures during discussions about LFC.
I highlight this issue because it is vitally important that fans have access to correct information in order to make an informed choice.
NB. This is not a pro-Hicks article (!) - It's anti-media inaccuracy, and that's it.
Jaimie Kanwar
mr.know everything
ReplyDeletehttp://www.bbc.co.uk/news/business-11484888
ReplyDelete1mins 24secs into the video with Broughton, he agrees they are set to lose about £140m.
I guess he has misread the accounts as well!
But hey, Jaimie knows better than the chairman of the club.
I mean, those accounts only ran through to July 2009, so quite easily could have been some more money put in by H&G which established financial and sports journalists with strong contacts would have found out about.
Good article I'm no accountant but have done bookkeeping and can follow your reasoning easily unfortunately it will go over the heads of most hacks and bloggers.
ReplyDeleteGood point, why try to reveal the truth when you can rabbit off oft repeated "facts"
ReplyDeleteReminds me of Richard Dawkins' arguments
Here's to a "good" result tomorrow. It's a real toss up between the devil we know and the one we don't
At least the Torres we know may re-emerge from his gloom
I've never seen the benefits of all these investements prompted on the CLub by americans.
ReplyDeleteWhich areas of the club made a progress? Stadium? Football side? Arrangements? Training Grounds?
Liverpool is making profits business, but these folks yanks ruined this mighty Club.
When They had took the Club, They promised a wealthy run of Liverpool, and immediately They broken promised loading a plenty of debts onto the Club.
Now Liverpool should pay for their high - risk financial plans.
Wooooow, mission accomplished by the two muppets.
Hopefully English Court and RBS will give a kick in the arse to Tom Hicks.
Please stop with that "exclusive" shit every time you write something, it´s just sad..
ReplyDeleteJamie, Where did all this money go? Aren't we talking to the tune of 370 Million (270 owed to RBS and 100 to G+H)?
ReplyDeleteYou need more hobbies, are you unemployed? no regional stereotype just reading between the lines, Fingers crossed for tommorrow (today)! we want Mr. Lim! ('we' being me). I bet the chinese could build a stadium overnight working magic with gurders, not needing sleep or adequate working conditions.
ReplyDelete1. The journo says 'about 140m or even more' - that's his viewq. Broughton interjects with 'about that'. He's not going to go into the fine detail re the club's accounts in a brief interview. He doesn't have the time to explain the differences between the various companies.
ReplyDelete2. re the accounts: the KFHL quite clearly state that the money owed to KFCL is 144.4m! The Daily Mail and The Telegraph use that *exact* figure. The Guardian uses 144m. Coincidence, I think not.
3. No money has been lent to LFC from H+G since 31 July 2009; I know that for a fact (anyone who reads the site's facebook page will know how I know), and that will be confirmed in the next accounts, released in a few months.
Can we get Jamie a girlfriend please?
ReplyDeleteSo Broughton just lets an incorrect fact go unchallenged, OK!!
ReplyDeleteYes. Otherwise he'd have to say something along the lines of the following: "Actually, it's not specifically 140m; only 100m is owed by the club itself, which is owned by the a company named Liverpool Football And Athletics Grounds Ltd. One of Hicks' holding companies - Kop Football Ltd - owes 144m to another of his holding companies - Kop Football (Holdings) Ltd, which is still technically classed as Liverpool, but is not actually the club per se...and on and on'.
ReplyDeleteThis would be confusing for the audience, plus it would send the interview in a different direction.
Broughton clearly just said 'about that' to avoid this.
is this website a holding company as well for da club owned by H+G. seems to be as all u say is Pro hicks and gillet but u can c da damage done to this great club even if u didnt know anything about football by these 2 lunatics m8.
ReplyDeleteWhen we're talking about loans to the club isn't this money actually just being used to pay interest on the leveraged buy-out of the club? This is what Christian Purslow and Martin Broughton have always maintained. But, hey, maybe you know better than them?
ReplyDeletethe thing that stood out the most for me was
ReplyDelete"The company may charge interest on loans to the club at it's discretion and began doing so in fiscal year 2008"
ummm what amount of interest and where does it go?
hello are you 'special' ? (thats NOT a compliment) how is that pro anyone ? Please could you put two (sharp) pencils up your nose and bang your head against the wall? if not for me then do it for 'da' club 'm8'
ReplyDeleteYes, I can see that you've given a fair appraisal of this site's approach. You've obviously done your research and read all the articles in coming to the conclusion that all I say is 'Pro Hicks and Gillett'.
ReplyDeleteI did a breakdown of all the interest payments, how/ muchwhere they go etc a few months ago here:
ReplyDeletehttp://www.liverpool-kop.com/2010/05/liverpool-fc-interest-payments-media.html
sigh, how is it pro? it is saying h+g put in less money than is being passed around as common knowledge. If anything it is providing you another stick to beat them with.
ReplyDeleteYou seem the stick beating type, sorry, da stick beating type.
Instead of being flippant, why don't you make points that are at least connected to what the article discusses...?
ReplyDeleteWhat the loans are spent on has nothing to do with what I wrote about. My point is the inaccurate reporting of how much money Hicks and Gillett have loaned the club. Interest payments are irrelevant to that point.
u're right bro. & then the yanks use Liverpool profits to pay off the debt that they owe/made. WTH?!
ReplyDeleteThere is a big hole in your logic.
ReplyDeleteWe know KFCL has lent 144m to KFHL.
We know KFL has lent 100.7m to the Club.
So how could there be a difference? Simple - KFHL has lent some money directly to the club.
Your initial assumption was:
1. KI loans money to KFCL
2. KFCL loans money to KFHL
3. KFHL loans money to KFL
4. KFL loans money to LFCAGL
Unless you have evidence to the contrary, there is no reason why the above chain has to be the only way of making intra-group loans.
the plot thickens ....
ReplyDelete"Blah blah blah Kanwar is employed by H&G. Kanwar hates Liverpool. True Liverpool supporters only concentrate on 'positive' things. Blah blah blah"
ReplyDeleteThere you go omar, and the rest of you. Now you don't need to go through too much effort* in posting here. Cut and paste your way to ignorance.
* Although clearly you don't even read the articles, so I'm not sure how much effort I'm really averting.
Thanks for your comment.
ReplyDeleteThere's no hole in the logic.
* If KFHL had lent money directly to the club it would be in the accounts of either LFCAGL or KFHL. It isn't.
* Loans cannot just be done on the fly; they have to be accounted for. No specific record = no loan.
* The chain I've outlined was set up by H+G for the specific purpose of channeling cash into the club. I do not need to prove otherwise - it is fact, as stated in the various accounts for each company.
Yes free chicken fried rice for everybody!
ReplyDeleteYou Racist Bigot
ReplyDeleteSo is your mum
ReplyDeletePS. If anyone wants to check out the accounts for themselves, email me and I'll email you copies.
ReplyDeleteYou only posted a "snippet" from the Club's accounts which is just a note. The 100.7m is possibly specifically mentioned in order to disclose the particular terms of that loan. It doesn't necessarily mean there aren't more loans.
ReplyDeleteWhat does the Balance Sheet actually show for "Amounts owed to group undertakings"?
In any event, the difference of 40m is a big number. These companies have not been in existence for long and presumably have no other business than investment holdings and loans ultimately related to LFC. It should be fairly simple to see where the 40m is.
* Balance Sheet of the Club
ReplyDeletedelaynomo - I've already posted the section that states 'amount owed to group undertakings' in the article! Whether it's a note or the actual creditors table makes no difference: it's the same. In any event, I've attached the creditors section for LFCAGL's 2009 accounts, and it states again categorically under 'owed to group undertakings' that the club owes 100.8m to KFL
ReplyDeleteIt is simple to see where the 40m is: It is still with the holding companies. As a matter of irrefutable fact, it was NOT loaned to the club. There's no point arguing against it; it's a fact! As i said before, any money loaned to the club must be accounted for in the club accounts.
ReplyDeleteBut that's only amounts falling due within one year. Some loans could be on a longer term basis.
ReplyDeleteSo why not post an extract to show the 40m cash on the holding company's Balance Sheet? Would complete the circle instead of playing this guessing game!
ReplyDeleteThat still doesn't change the fact that there is no record of an extra loan being made in the first place! There has to be a record; the money can't just appear out of nowhere. There is always a paper trail.
ReplyDeleteI can understand you being peed off with the gutter press about the accounts. Ask me this then
ReplyDeleteThey buy the club by X amount. Where did they get there money from. Loans or own money.
Liverpool football club make a profit. Yes or No. So where has that money gone too.
Why have they set up so many holding compaines all over the place.
Do they have someting too hide.
Why are they leanding money to there own football club ( there own business )
So it a nut shell. Where has all the money gone, which they have not spent on the club to improve the club. So they have spent say 120 mil & we are in debt up to our eye balls. Work that out
100 million includes INTEREST! The actual investment made is much less and G+H is making interest income out of Pool. Just too bad for them in making a bad investment.
ReplyDeleteHave you looked at the long term liability section (more than one year)?
ReplyDeleteGet the accounts and check yourself; In haven;t got time to play this game. You're just trying to prove me wrong for the sake of trying to prove me wrong. I've expained how it's not possible for KFHL to have loaned money directly to LFCGL; I've explained how loans have to be accounted for BY LAW. If you choose to ignore these things that's your affair.
ReplyDeleteAnd I've already show where the extra 40m is - it's stil with KFHL. They owe KFCL 144m. That proves that 144m was in existence. Then following the money trail, only 100-120m made it through to LFCAGL. There's n9o smoke and mirrors here; that's fact.
Seriously Jaimie, and this changes the situation how?
ReplyDeleteBoo, the press got their facts wrong. Big surprise.
The club is still in the crapper at this very moment because of these two regardless.
Now if you were to come out and tell me that Hicks & Gillett were swindling money from the club through these holding companies and accounts, taking RBS and Wachovia money and only lending only a certain amount to the club and pocketing the rest, then you'd have something worth reading.
ReplyDeleteI would rather go by what Mr Broughton said in his interview than what this muppet here claims, At least your getting facts straight from the horses mouth as in from Mr Broughton himself. If your accounting information is true, where did u get it from? Did u break into the offices at Anfield? lol
ReplyDelete.....watch this interview at 1min 10sec duration you will see Mr Broughton clearly agreeing with the interviewer that its about £140m http://news.bbc.co.uk/sport2/hi/football/teams/l/liverpool/9066856.stm
ReplyDeletePurslow came and and stated the club was solvent and could stand on its own two feet so the loans made were for what exactly?
ReplyDeleteMy guess is they have filtered funds out and loaned them back with interest any clues there Jamie.
Jamie, nothing wrong with your logic. I'm the accountant from Australia and I've been impressed with your articles regarding finance. I don't always agree with you on footballing matters but that is merely opinion not fact. When it comes to facts your spot on.
ReplyDeleteso how much will H&G lose? You havent given us your opinion on this - only that the 140/144 is wrong.
ReplyDeleteHow much are H+G paying you mate ? If everyone was to review the company's financial statements, then and only then can this arguement be judged.
ReplyDeleteWell whatever it is, the yanks are set to lose any money they invested (loaned) to us. The more the better ;)
ReplyDeleteWould it be reasonable to assume Jaimie, that the amounts the "loan" you've detailed above is increasing by is the amount of accrued interest for each fiscal year?
ReplyDeleteIf you look at the original loan amount £64m, it grows to £79m by the end of the 2008 fiscal (July) year, the notes state that interest was being charged from the start of the 2008 fiscal year (August 1st 2007), by 2009 it has grown to £100m with the interest from 1st August 2008 to 31st July 2009 - by the time the credit note comes about for the end of the fiscal year 2010 there is a seemingly new £20m loan amount, is it possible that this is interest on the £100m for the 2010 fiscal year?
It would certainly explain and concur with your assumption that the balance is now £120m approx? It also would otherwise seem odd that the loan amount goes up in £20m incriments without this perhaps being the rolling interest being added each fiscal year.
Annual Financial Reports for ALL UK Companies are available to the public for a small charge from Companies House, Drew. It's a rule under regulation from the FSA - all shareholder based companies must make their financial reports available for public scrutiny.
ReplyDeleteNo mate....the figures speak for themselves. KFH recieved £144 million from Cayman. It is KFH, not LFC, that RBS loaned their money to. £11O million of the RBS debt was secured by H&G PERSONALLY. The remaining £177 Million (hard to be 100% on this fugure) was secured against LFC's assets. H&G are at risk for £255 million in total. NESV will provide the cash to pay RBS all the debt and save H&G the £110 million. But they will lose £144 million owed to Cayman etc. The press is right...you made a naive mistake.
ReplyDeleteThis was so funny to read, not that the facts aren't there to be disputed, no just the fact that your Cessepool muppets are arguing over how the money was spent or that the crap-loids got the information wrong... lol
ReplyDeleteThe fact & only fact is, your club is in debt up over your revenue income due to 2 a-hole yanks wanting to use your club as a portal for cleaning case to pay off their debt in the States, now instead of letting the RBS take you over, you're allowing yest another Yank who's no where near a billionaire take control with his company of other Yanks, none of who are even rich enough to own your club individually, so it's out of the fire & into the ashes I think!!
Yes the Toon have been there with Ashley but at least Ashley has the money to back up anything he wants to do, unlike your Yank owners, personally I hope you get 9 points deducted & fall in to the nPower league for a season, believe me, it doesn't half sober yer up some!!!
Btw, back in July 2009, maybe the exchange rate was £1 = $1.44, so your £100m would equate to $144m... did any of you think of that???
I can give You a number: five.
ReplyDeletePut this your number in your head..
5...
I've already addressed that at the start of the thread.
ReplyDeleteFacts are facts. Broughton did not state that the amount was 140; an interview said 140m, and he said 'abnout that'. And as It would've been too complicated for him t explain the whole saga, and it doesn't really matter if the figure is a bit wide of the mark for the purposes of the interview as that is not what it's about at that stage.
ReplyDeleteI don't think they'll actually lose that much. The money was a loan after all - whether we like it or not, they are entitled to be repaid. If the sale to NESV goes through, they could just go through the courts to try and claim the money. It will probably take ages but they'll get some money back eventually. Having said that, LFC, NESV and RBS may wll sit down and come up with some kind of settlement to avoid ongoing court cases. This would be the best idea IMO.
ReplyDeleteGreat points, Kop. I think that's definitely a possibility. I did consider it but didn't include it in the article as I can't really back it up with fact. The 20m could be a project of what interest would be incurred over the following year.
ReplyDeleteDoes it really matter? At the end of the day £144.4m is repayable to Kop Cayman on demand. Does it matter whether that is coming directly from the club or from another holding company. These companies were all set up for one reason - Liverpool FC. They don't have any other interests other than Liverpool FC. When H&G leave they are owed £144.4m. Thats the bottom line. Or am I missing something?
ReplyDeleteHi Gary - Kop Cayman is owned by Hicks and Gillett - they're hardly going to demand that they repay themselves on demand ;)
ReplyDeleteThey put their own money into the club, and it filtered down from the top (KI) all the way down to LFCAGL). The points of contention here are:
a) How much money was actualy loaned to the club (i.e. LFCAGL).
b) How much the club owes H+G
Considering only 100m went to the club, it is just totally wrong to suggest that they will lose 144m
Well done Jamie
ReplyDeleteYour analysis is sound and your points re lack of accuracy the reason you are doing this. This blog is the most important focus for information and debate about our club and shaping it's future .I is a focus for 'sensible opinion' when you get it. Just keep going and keep focused on what is important to make the club great again.
Ken
h+g have milked thier money out of the club already they will lose nothing but profit, outgoings - expenses, rediculous costs on new stadium not even started, each year selling big and buying small.
ReplyDeleteI understand why we need to differentiate between the holding companies and the club but am i being a bit thick to think that it is all ultimately one and the same. We can agree that the holding companies were set up for purely for the reason to run Liverpool FC. The reason for the different holdings companies is probably due to tax purposes. We agree that H&G have put £144.4m into the holding companies of which £100.8m has filtered down to club. Now if the holding company was to go into administration then do H&G lose £144.4m or not? If this sale to NESV goes through will H&G lose this £144.4m, because as I understand it NESV are to repay the creditors and nothing more, so H&G will lose everything that they have invested into the club.
ReplyDeleteIf £144.4m was given to the holding company but only £100.8m was given to teh club, what's happened to that £40m or so. Is it still sat in the holding company? If so what was the purpose of that loan if it wasn;t goin gto filter down to the club? Was it spent on something else?
Considering that your information relates to accounts dated 31st July 2009 is it possible that the difference you talk about has already filtered down to the club?
ReplyDeleteThere could be many transactions between the companies in the last 14 months and if we know for certain that H & G have not put any more money into the holding company then it is quite beleivable that the balance is £144.4m, as stated.
Why do you think you know more than Broughton does when you only have accounting information date July 2009 to go off?
That's a possibility - however, it's not likely. As I show in the article, The Guardian is also working from accounts dated 31 July 2009, and they state that the figure at that date was 144.4m.
ReplyDeleteAlso, no one at LFC is likely to tell a journo about LFC's finances. That would be a breach of confidentiality on a grand scale.
Please look at the accounts for KFHL posted in the article: it clearly states that 144.4m is owed to Kop Cayman.
It is beyond question that newspapers got the figure from there, mistakenly thinking that was the club's accounts.
Not possible. As I show in the article, The Guardian is also working from accounts dated 31 July 2009, and they state that the figure at that date was 144.4m.
ReplyDeleteAlso, no one at LFC is likely to tell a journo about LFC's finances. That would be a breach of confidentiality on a grand scale.
Please look at the accounts for KFHL posted in the article: it clearly states that 144.4m is owed to Kop Cayman.
It is beyond quest
Wasn't the holding company loan converted to equity this year at RBS's insistence, thereby wiping the loan in the event of a sale?
ReplyDeleteWhy do you think it is not possible? Thats is quite a statement you have made when you don't have the information to back it up.
ReplyDeleteTry this.
H & G don't put any more money into the the holding company after 31st July 2009 so this balance will not have changed.
The transactions between the holding company and LFC result in LFC having a further injection of funds during the last 14 months (quite feasible when you consider the money being wasted at the club). LFC would then owe the holding company £144m and the holding company would then owe it to the H & G.
It is therefore quite obvious why the banks are using the £144m if the believe that no further funds have been injected from H & G.
Your assumption that the balance between the holding company and LFC is still the same after 14 months is the only thing that is 'Not possible'.
Hey Jamie, its all the fault of the SOS... You should blame them as im sure they have something to do with these discrepencies. I mean, you blame them for alomost everything else so i don't see how they aren't involved this time. Surely you could use your superior detective skills and unveil this mystery as a sub plot of the SOS......
ReplyDeleteThey are set to lose £140 mill because they wll lose the loans to the club AND those made to themselves, surely ?
ReplyDeleteSOS's culpaility is always assumed and self-evident. No need to investigate 8-) :-P
ReplyDeleteYou've done bookkeeping have you? Does that make you far more intelligent than the other people who use the blogs because you say don't think they'll understand it? Arrogant prat!
ReplyDeleteMy definition of a bookkeeper is a person who hasn't got the intelligence or motivation to become a proper accountant. They've either failed their exams, couldn't be bothered doing them or gave up completeley and moved into another field.
You add nothing to this article other than you ' can follow it easily'. Where is your comment on what the man has said?, nowhere because the truth is you don't understand it at all.
You make some excellent points, which are well researched and well articulated. Except one!
ReplyDeleteYou mention that H&G will be looking for repayment of their loan too, and in a normal acquisition one would support that notion. However, there is a little known or understood section of the Insolvency Act 2006 which allows, in the event of severe financial distress for the directors of the company to arrange whats called a Company Voluntary Arrangement (CVA), this is a form a pre-packaged administration where the company appoints an administrator, who then immediately sells the company and provides the funds to the secured creditors, therefore cutting out the shareholders and indeed any assets or liabilities that the new owners don't want. As long as the directors, creditors and administrator is confident that the process achieves best value for the assets sold.
This is the plan of action being implemented in LFC's case, and has been alluded to with comments from the directors where they have intimated that they must 'act in the best interests of the creditors'. This is only true when the directors believe they are trading insolvently, but have an achievable plan to remedy. Also the notion that RBS will get paid back suggests that they are the secured creditor pulling this through and what H&G will be fighting in the court (they will argue that the holding company is not trading insolvently). There is precedent in law that allows this action to go through and the first major case (which included cross border jurisdiction too) was Collins & Aikment (2006). I worked very closely on that case.
Lim is not Chinese! He's from Singapore...
ReplyDeleteI don't get u....
ReplyDeleteA loan is a loan...an investment is an investment!
Don't try to confuse yourself? No?
Let's just make it simple Kahwar! Yes?
The point is H&G will loose 140+ million poud of thier own money(in investment)
if Liverpool is sold at the price of 300 million pound.
So what about the so call 100 million debt/loan that Liverpool fc owes to its parent company?
Well since it is an internal loan..... case is quite different.
You just don simply add the external RBS 237 million + other external debt with it...
It should really consider as the overall debtb( but it still needs to be service!)
Anyway the inetrnal 100million pound loan can be defaulted by the parent company anytime they are aloud to!(with some adm cost)
but the real question is the Parent company or just Liverppol fc that is being Sold/Auction here...
if the parent Company is sold... than H&G can Kiss good bye to it...
if only Liverpool Fc is sold than the 100 million pound will become an external loan...
they may need to pay H&G former parent company the full loan....
or The New Liverpool FC just have to continue to service its now new external debt...
So H&G need Liverppol FC to be sold at 340+million pound to break even ...
or H&G needs the parent company to be sold at 440 million pond to break on thier overall investment!!!
Anyway Kahwar your atempt to seperate the parent company with Liverpoolfc is wrong,misleading and pathetic.
Parent Company and thier subd company should always consider as one(even if they are technically not) when the parent company onlly asset is that subd comnpany.
Saying that Liverpoolfc only has to services it's 100 million pound debt is also not fully true.
One must remember all the profits...gains,...dividen is own by the parent company.
While it is true that Liverpoolfc may not need to pay more than what is require by them.... eventually they will suffer the ciost with lost of all current profits and cuts. So as long as the parent company needs to services its debt than LiverpoolFc will have to suffer the consequence of it.(since the parents company or/and the owner don't have other resources) .
So if this is not resolves than as they say....."THE SHP WILL SINK FROM THE TOP"!
P/S what a shame...if only they originally made an investment of 150 million and just borrow another 100-150 million.
Correction: shoudl ----> should not
ReplyDeleteIt should Not really consider as the overall debtb( but it still needs to be service!) <span>
</span>
"Get the accounts and check yourself; In haven;t got time to play this game."
ReplyDeleteDoes that mean you haven't checked the possible scenarios I mentioned? In which case, how do you know you are right?
"You're just trying to prove me wrong for the sake of trying to prove me wrong."
What's that suposed to mean? LOL
If you haven't covered the possibilities I mention, there's still a potential hole in your logic. You might be wrong.
I read they would lose the entire 100/120/140m (whatever) because, as another term of the previous refinancing, these loans were converted into equity.
ReplyDeleteAll those amounts are in GBP.
ReplyDeleteThat is not what the media have been arguing - they have used the 144m figure from KFHL incorrectly. It's that simple.
ReplyDeleteEven if H+G have loaned the club more money since July 2009, the media would not be aware of it as to reveal such info is illegal.
This is all about the info being peddled by the media as fact, which isn't fact.
MEDIA: Hicsk + Gillett loaned LFC 144m
Wrong.
TRUTH: H+G loaned Liverpool 100.8m
The issue that needs to be addressed is which company is being sold to NESV,<span> is it Kop Football Ltd (KFL)</span><span> or Liverpool Football Club & Athletic Grounds Ltd (LFCAGL).</span>
ReplyDelete<span>
</span>
At the last round of refinancing, didn't RBS insist that the loans that the club owed to H&G be converted to equity?
ReplyDeleteIf so, the club owes H&G diddly squat. Not 100 million. Nothing.
At the last round of refinancing, didn't RBS insist that the loans that the club owed to H&G be converted to equity?
ReplyDeleteIf so, the club owes H&G diddly squat. Not 100 million. Nothing.
This all seems to make sense, except could you clarify one thing? While the sharholders would be cut out, wouldn't Kop Football (Holdings) as a large creditor of Kop Football also have a say along with the administrator, directors and other creditors?
ReplyDeleteSome interesting points here:
ReplyDeletehttp://forums.liverpoolfc.tv/showthread.php?p=4282189
seem to explain why the money will be lost and not owed. After all, I can't see anyone putting a firm offer in for our club if it still owes £100m+ at 10% to those to clowns.
The information provided here is factual and I can't see how one can dispute this. It also shows how the press can be misleading. Well done Jaimie. How was this approx 120k spent ? players , salaries ? It's not clear to me why everyone keeps saying that LFC is paying the interest for the loan taken by KOP football Ltd ? or rather H&G ? How is the club suffering in interest payments from the asquisition debt ?
ReplyDeleteOne more day to go and appeals to deal with with, I still prefer the NESV option rather the LIM option as
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteThe Two cowboys increased Mechandise turnover and Sponsorship (mainly due to bringing in a qualified guy in Mr Ayre).
Money had already ben spent on the stadium to get the grants and planning permission under Moores. they came in and borrowed more money to "improve" the stadium. Did anyone see blueprints? I just saw artist impressions. It was bogus .... so where has the 60+ million spent on the stadium gone? I guess they 'loaned' it back to LFC out of their own pocket (after placing it there when they extended the RBS loan). They then default/roll up interest? on paying back money or renegotiate for a bigger loan and higher interest? All the while sucking out 30-40 million out of the club to go towards interest payments.
In the 3 years that they have been in charge and must be pretty close to breaking even on transfers since summer 2007.
Lets not forget that the Cowboys had to pay off (err was it 100million) as part of the last RBS merry go round.
So lets see at one stage RBS/Wachovia were owed 320m .....
Buy club = 220m that leaves 100m ......
Buy players = 20m net at a stretch ..... that leaves 80m ....
So lets say they really didn't spend 60m on the stadium and they had 80m in loaned money to play with after buying 3 years worth of players and the Club itself .....
Where is the 80m? Well they lend LFC 100m to pay back the 100m money to RBS/Wachovia .... so in the accounts they have loaned LFC 100m and now owe RBS 230m.
They paid off much of the owed money with money they loaned from RBS in the first place, but they say it's money from theri own pocket and charge 10% interest!
OK .... so it's simplified and of course there were penalties and setup costs for the loans not accounted for but at the end of the day the Yanks haven't put any money into the club. they've caused a lot of money to be wasted though with all the 'mortgaging' of the club.
Let's just hope that they've screwed themselves over and that they have both lost a substantial amount!
Let's face it, it would serve they right ......
Nail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteNail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteNail on head ther martian ..... where's the money? ..... The club cost them approx 220 million ...... it was about breaking even while spending 10+ million/year on average on new players. Champions League final 2007 and the accounts should of improved due to the Champs League monies.
ReplyDeleteJamie, you are obviously not an accountant. I have read some of your articles that have used the accounts to provide evidence to back up your argument. You simply cannot use a set of financial statements in that way. A set of accounts should be read in it's entitled to get an understanding of a companies position at a particular point in time. There are rules called standard that have to be applied when dealing with postings. There are mandatory disclosures that can't be looked at in isolation. I know that you are not an accountant from the way you are presenting the information. But sure what would I know, I am just a humble accountant.
ReplyDeleteJaimie you still do not get the point, most fans understand the mess H&G dumped on this club with or without your figurers we are in the shit of a mess and that mess was created by H & G why dont you drop it now we do not need any more of your articles about H & G, or maybe you find it hard to write about football since Rafa was stabbed in the back
ReplyDeleteinstead of telling me 'I'm not an accountant', why don't you explain how I've got it wrong. You are an accountant after all, aren't you?
ReplyDeleteYou're ocmplaining for the sake of complaining
. many qualified accountants have ratified my posts on this site. They are accurate. And you CAn use accounts in this way. You're assuming that I'm looking at things in isolation; I'm not. I POST snippets from the accounts in isolation, but I consider the accounts in full when outlining my theories.
Oi Kanwar! ....Noooooo!
ReplyDeleteI often disagree with Jaimie's opinions, esp regarding Rafa, but I enjoy visiting this site because:
ReplyDelete1. It's nice to hear different points of view and challenge your brain
2. Jaimie is no doubt intelligent and presents good points.
3. His articles are well researched and seem to be generally correct
4. It seems he has nothing of material value to gain from this site and hence he doesn't write simply to provoke a reaction.
For the above reasons, I cannot understand why people would read such a well researched article (much more than I can say for ALL of the journalists who write about Liverpool FC), that obviously required many hours of research and writing, and insist on disagreeing and slagging Jaimie, for well, no apparent reason!
Thank you Jaimie for spending so much time to inform us of some interesting facts, good article, keep em coming! :)
It seems like H+G will both lose out bigtime as the money they lent to LFCAGL was turned into equity on RBS insistance, possibly in the last refinace thus it wouldn't appear in the last accounts.
ReplyDeleteWhere did i get this from? the liverpool eco on page 3 of the following article. http://www.liverpoolecho.co.uk/liverpool-fc/liverpool-fc-news/2010/10/07/american-owners-will-walk-away-humiliated-reds-message-to-tom-hicks-and-george-gillett-100252-27419626/3/
OH DEAR, Capital EXCLUSIVE, Capital KUNT
ReplyDelete<span>Interesting article - bizarre to see so many hostile responses.</span>
ReplyDelete<span>I'll ask the following as you seem to know your way around the accounts and the finances of LFC (but accept that you would not necessarily know what I'm asking but if you can give it a stab it would be appreciated!)</span>
<span>What you may be able to help me out with is, why there are so many buffering companies between the initial loans and the real LFC? Does each company in turn make a profit on the loan it then in turn makes to the next company, with the club ultimately carrying the overall debt (including the cost of running all these companies)? </span>
<span>These companies must have some purpose and for me its always going to be around making money for their share holders - who controls these companies and why are they involved?</span>
<span>Where the hell has all the money gone?! I have never understood how we haemorrhaged the amounts stated (and I am never going to accept the bullshit merchants blaming Rafa). I could have accepted the figures had we built a stadium and been left with a large ongoing debt but these amounts are essentially running costs (and dividends) and have always, to me, seemed excessive in such a short time (as from what I understand we actually operate at a profit other than this debt).</span>
<span>Maybe only a matter of morality (and I thought it was outrageous when I first came across it with Chelski) but I have never understood how can you make a loan to yourself in a business venture you own and then claim the money back as you walk away especially if its failing - how can an owner in a failed business be a creditor? </span>
delaynomo, jaimie is never wrong he only writes researched articles you should know that if you are a regular reader of his blogs JAIMIE is NEVER wrong
ReplyDeleteoh poo ... i should have gone with 'asian' i wonder how good people from singapore are with gurders .. i bet they get the chinese in
ReplyDeleteoh poo ... i wonder how good the singaporians are with gurders ? .. i bet they still get the chinese in
ReplyDeleteoh poo ... i wonder how good the singaporians are with gurders ? .. i bet they get the chinese in<span></span>
ReplyDeleteslightly pedant argument
ReplyDelete<span></span>"Considering only 100m went to the club, it is just totally wrong to suggest that they will lose 144m *invested in the club*"
One significant point - Hicks and Gillette may have loaned LFC £100m, the question is what of the loan interest repayments which LFC have been making for the past three or more years at their behest. Does anybody know what that amounts to and has this been taken into consideration?
ReplyDeleteWho cares, the Yanks are out!!!
ReplyDeleteJaimie, there is one question I need to ask. Whats the situation with your and Duncan Oldham? Very glowing comments from the con artist on twitter in relation to yourself.
ReplyDeleteDavid Conn is nowhere near so clever as he thinks he is. His analysis of both previous Chelsea and Arsenal accounts miss fundamental points.
ReplyDelete2 of us have raised the point about the holding company loans being converted to equity, contrary to your article, but you haven't replied...
ReplyDeleteIf you can provide concrete evidence that took place then I will respond. Cheers.
ReplyDeletea good addition to this information would be the interest payments made by the club on those loans over the course of their ownership.
ReplyDeleteJamie - looks like you're wasting your breath trying to convince these, erm, people. They obviously cannot follow the simple logic of your argument.
ReplyDeleteIf anyone is still disputing these figures go see David Conn's latest Guardian (13-10-10) article where he praises Jaimie and links to this very article.
i have watched you switch from one 'contraversial' viewpoint to another over the last year or so, generally in defense of the owners or with an 'anti-rafa' piece or an exclusive that only your high and mighty intellect has been able to point out. while the original post leaves itself open to derision by internet snobs, i struggle to recall at any point, something written by yourself that casts the owners in a bad light. the times you've come close have always been qualified by shifting the 'real' blame elsewhere. if the courts can see that the owners are out of order then why can't you?
ReplyDeleteExcellent article, JamieK. I am able to follow the financial logic and so is David Conn of the Guardian, who acknowledges your careful examination of the sets of accounts in today's article - see
ReplyDeletehttp://www.guardian.co.uk/football/blog/2010/oct/13/liverpool-martin-broughton-hicks-gillett
All you doubters should back off; JamieK is a rare LFC blogger, one who does not let emotion colour facts.
I've not read all the comments so apologies if this has already been said.
ReplyDeleteWhether it's £100m or £144m what does it really matter to LFC fans now?
They're going to lose it so great! It's not going to affect how much money the club will have now so what does it matter?
JK - have you seen your great shout out from David Conn:
ReplyDeletehttp://www.guardian.co.uk/football/blog/2010/oct/13/liverpool-martin-broughton-hicks-gillett
He's undoubtedly the best journalist out there when it comes to the financial side of football and he's bigging you up so kudos there.
I don't always agree with you and reserve the right to disagree again...
You've played a blinder here though
didn't notice this before i posted - apologies for duplication
ReplyDeleteHey Stell - thanks so much for the kind words. I only just saw that Guardian article. I'm just glad that the real figure is being validated; nothing irritates me more than the mass dissemination of inaccurate info re LFC.
ReplyDeleteDavid Conn emailed me too - even though he agrees with me, he says one of his colleagues believes that Kop Football is the company that will be sold, not LFCAGL. Since Kop Football owes KFHL 145m, his colleague suggests that the 140m could be right.
Since then, Mr Conn has edited his article (probably covering himself), but he's into a loser. It will not be Kop Football that gets sold; it will be LFCAGL. That is where the shares lie; Kop Football has no shares. It doesn't make any sense, but if that's what he wants to believe, that's up to him I suppose.
Hi jamie. So if Lfc only owe 120M at most and NESV buyin the club for 300M then where does the other 180M go to?
ReplyDeleteThe 300m from NESV will not used to pay off H+G's loans to LFC; it will be used to pay off the outstanding RBS loans, which currently stand at 200m. The rest of the money will be used for clearing other debts, but until the sale takes place, we won't know exactrealy how it will all break down.
ReplyDeleteThanks Jaimie. Do H+G lose their loans to LFC or can they demand repayment if Nesv takeover.
ReplyDeleteAlso with this new Texas injunction, why do you think H+G are determined for RBS to takeover LFC. Can they reclaim any of their lost money if the club goes into adminastration?
Hi Martian. The money loaned from RBS went to the previous owners during the sale of the club to the Americans. Hicks & Gillett have, in effect, never owned Liverpool FC. They simply borrowed the money, saddling the club with crippling debts. As Aaron wrote above, some key information would be the amount of interest H & G have charged LFC for the loans made through their spider's web of holding companies. These chancers came in talking themselves up as the saviours of LFC and have lied and cheated through the duration of their tenure. The first thing they talked about doing was a new stadium - 3 years later and nothing's happened. They obviously have little understanding of football and the history involved with our great club.
ReplyDeleteHow are interest payments irrelevant? How do we know that the £100m isn't made up of the original loan of £64m, plus £36m of interest going to H&G. The fact is that H&G have loaned millions through their off shore company (tax exempt) and have charged interest on those loans, putting LFC further in debt.
ReplyDeleteWhat I dont understand Jaime claiming to be a Liverpool Fan as far as I can see is that all his articles even his so called "positive articles"contain a rant against the manager, the people of Liverpool that he calls "super fans" written with a derogatory tone, the players SOS, must of us are sick and tired of his rants against our club, yet he constantly writes absurd articles about our soon to be gone owners who have in the papers presented to the Texas court state quite clearly that all the holding compaies rely entirley on Liverpool football club making a joke of all his articles on the finaces a joke and irrelevant.
ReplyDeleteGood analysis, but redundant if the seller is Kop Football Limited.
ReplyDeleteThe TRO that the guardian is hosting makes it clear that the sale to NESV is being effected by way of a sale of all of Kop Football Limited's shares in Liverpool Football Club and Athletic Ground Limited (LFC - the trading company which owns the club assets). Presumably, the SPA will provide that in consideration for NESV buying the shares in LFC for £240 million (or whatever the exact number is), Kop Football Limited will waive the loans it has made to LFC. This would leave Hicks and Gillet with an asset-less rump of group companies who all owe money back up the chain to the two lads, but none of whom are owed any money by LFC (or anybody else). This is how they get left holding £144 million of outstanding loans with no recourse against the club or the new owners.