by Brian Reade
Liverpool, who are being bought by an investment company effectively owned by the Dubai government, could be sold again in seven years’ time, according to a confidential document.
The document also reveals that Dubai International Capital are planning to borrow up to £300 million to finance their £450 million purchase of the club. DIC see their investment in Liverpool as purely a business deal built round the new stadium Liverpool are planning at Stanley Park. When they sell in seven years’ time they are hoping to make a huge profit, providing a return of around 25% on their investment for every year of ownership. There appear to be no plans to invest in new players.
Furthermore, DIC will not be the sole owners of Liverpool, unlike Roman Abramovich at Chelsea, the Glazers at Manchester United and Randy Lerner at Aston Villa. Although their deal to buy Liverpool is not yet signed and sealed, they are already looking for other investors to join them in a partnership. I understand that 30% of the 90% stake DIC are bidding for is being offered to City investors.
The seven-page document, which outlines the investment rationale, has been circulated to major City investors to attract them to join the consortium.
However, anyone reading the document can have no doubt that this is purely an investment decision. And with DIC seeking partners, there is also no knowing who else will be in the Liverpool boardroom.
One of the most revealing insights is when the document talks of how the financing will be done. A whole page is devoted to it and shows that three banks – Bank of Ireland, RBS and Bank of America – have been approached, with Bank of America the favourite.
The DIC document notes that the stadium, which will seat 61,000, will cost less per seat than Arsenal’s Emirates Stadium. The document also provides a wonderful insight into DIC’s thinking but is very different from the fans’ expectations about this purchase – and would have been very different from the purchase of the club by Gillett.
Moores believed every word of the report, was horrified that he had agreed to sell to them and said to Parry, ‘That’s it, kick them out.’ Al Ansari was equally horrified that the document had been leaked, but immediately rubbished the story with claims that due process determined the proposal had to be put through DIC’s investment committee to win approval.
By the middle of January Parry was still telling the media the deal with DIC was almost done, but as the month dragged on it was being leaked that Gillett had capitalised on DIC’s tardiness by putting in a bid which valued the shares at £500 more than the Arabs were willing to pay.
At this point the non-executive directors and major shareholders were getting anxious about DIC’s credibility and wanted to see if Gillett could put a better bid on the table. Sources close to Moores say that Steve Morgan told him he believed Gillett was willing to bid more, and that as a shareholder he wanted maximum return on his investment.
The pressure on Moores to do the one thing in life he hated, confront a major decision head-on, was becoming unbearable. The steel order had still not been placed, which put the stadium in doubt, and there was no money for new players but Moores was insisting that he’d shaken hands on a deal with DIC, so, in his head, there was no going back.
By the end of January, with the DIC exclusivity deal no longer in place, major shareholders told Moores to forget about gentleman’s agreements and consider any new and better offers or they would consider taking legal action against him.
In the middle of all the confusion Tom Hicks walked into town and nothing would be the same again. Moores met him and Gillett at Anfield for one hour, in which he claims to have looked them in the eyes and said: ‘There’s two things I want from you: a guarantee that there won’t be any debt on the club and a guarantee that the new stadium will be built.’
Moores says they looked back into his eyes and gave personal assurances that there would be no debt on the club, because it was all family money, and that the stadium would be ready for the start of the 2009 season.
On 30 January, en route to Liverpool’s game at West Ham, an impromptu board meeting was held in the Marriott Hotel in London’s Docklands to consider the Americans’ offer of £5,000 a share, despite DIC believing it was being held to rubber-stamp their own deal and set a date for the public announcement.
Moores and Parry told the board they had seen private schedules from bankers Rothschild which approved Hicks’s and Gillett’s family investments and justified their wealth. When asked about Hicks they were told that Gillett, who they now trusted implicitly, had assured them he was an honest guy who was good for his money and his word. Why else would he bring him in? The board then decided to ditch DIC and go with the Americans, but according to Parry, Moores was still saying he was unhappy about breaking his word and needed to be left alone for forty-eight hours to think through the biggest decision he would ever take.
The board moved on to West Ham where, waiting in the directors’ box, was a DIC official keen to know how the Docklands meeting had gone. Cue much shuffling, coughing and staring at the pigeons on the stand roof opposite. DIC smelt a rat.
At ten a.m. the following day Moores rang Al Ansari to explain that he hadn’t been impressed with the feet-dragging and he’d been put under pressure from board members to consider another bid. He told him he hadn’t made a decision either way and needed forty-eight hours to do so. An unimpressed Al Ansari told him he had until five p.m. that day to make up his mind or DIC would walk.
Moores was outraged at the threat, telling Al Ansari he had no right to bully the chairman of Liverpool Football Club in such a manner and refused to adhere to his ultimatum. At four p.m., an hour before their self-imposed deadline was due to expire, DIC announced their withdrawal from the bidding process.
Parry and Moores were baffled by DIC’s behaviour, especially as the chairman had yet to make a decision on who he was going with. They began to wonder if the Arabs had been waiting for a face-saving excuse to pull out because the people who really mattered in Dubai were never truly behind the deal.
Al Ansari’s official statement read: ‘We are very disappointed. DIC is a serious investor with considerable resources. After a huge amount of work, we proposed a deal that would provide the club with the funds it needs.’
That was the diplomatic line. The Daily Telegraph’s quote from a DIC source more closely conveyed their Krakatoa-style reaction to what they deemed treachery: ‘It has been an absolute shambles. Over the last few days it has been impossible to get a sensible answer out of them as to what’s going on. The way DIC have been treated is staggering and to say they are unhappy would be way more than an understatement.’
Fans reacted with a mixture of shock, panic, anger, resignation and cynicism. On the website Red All Over The Land, David Moores and Rick Parry were being lampooned as Laurel and Hardy.
Liverpudlians felt like they’d been led through the bling-drenched streets of Dubai, and told it was all theirs, only to reach the desert and find a mirage. They demanded answers: Why had they been told the DIC deal was not only the best one but virtually done and dusted? Why had they still been spun a vision of a golden future even when newspaper reports had tried to rubbish DIC’s motives? Why had they met the manager and the captain? Why was Moores not saying anything? Was this yet another amateurish cock-up?
The Echo’s Liverpool reporter at the time, Chris Bascombe, who was probably the closest journalist to the story, was equally baffled. He confronted Parry on the night of the Docklands meeting to find out what was happening.
‘He confirmed that Gillett had moved ahead of DIC in the pecking order and I thought “this is utter bollocks” because a week earlier Parry had dismissed rumours that Gillett was back at the table. Now they were inviting him in. It didn’t add up.
‘No one was saying anything. Moores wasn’t explaining himself and the shareholders were quiet.
‘I couldn’t work out why Gillett had suddenly offered £5,000 a share when the offer below it was £4,500. It didn’t make financial sens
e. You’d up it to £4,600 at first, wouldn’t you?’
Parry stepped up to perform the mother of all U-turns, attempting to placate anger in an Echo front-page article under the headline ‘Trust Us’:
‘The overriding message is “don’t worry”. Whatever decision is finally taken will be done so in the best interests of Liverpool Football Club… We had a duty as directors to consider a very interesting bid from George Gillett.’
As website wags took pleasure in pointing out, that calm attempt at reassurance from on high was slightly undermined by a photograph of Rick Parry on the front of the Echo looking remarkably like a stunned Harpo Marx.
When journalists pushed Parry on why Gillett was suddenly good for his money he told them a new element to the bid had made all the difference: Tom Hicks.
‘I’d never heard of him,’ said Bascombe. ‘But when I put his name into my laptop search engine it immediately came up ‘Hicks and Gillett’. I couldn’t work it out. Then I remembered when Gillett came on the scene the previous summer someone told me he was working with Tom Hicks and when I’d tried to check him out an American journalist had said “he’s an absolute disaster”.’
Bascombe is sceptical about Liverpool’s assertion that Hicks magically appeared on the scene: ‘I believe they’d looked at Tom Hicks and thought PR-wise it’s not good for him to be mentioned because Liverpool fans aren’t necessarily going to like this brash, Republican Texan.
‘But they were so desperate when they went with Gillett that PR-wise they had to make Hicks look good. So suddenly he’s this big Wall Street player and powerful political figure, all of which proved to be garbage.’
Having covered the prolonged takeover story on a daily basis Bascombe says he sensed the turning point with DIC came when Moores and Parry weren’t given cast-iron guarantees that they would remain in a job.
‘Parry said, out of the blue one day, “There’s been no mention of any role for me and David, you know,” and I remembered thinking he’s starting to change his attitude here.’ It is a charge both categorically deny.
When anger among Kopites surfaced over the DIC bid being rejected for a more lucrative one, which would give Moores £8 million more than the £80 million the Arabs would have paid him, he was said to be ‘appalled and horrified’. But the chairman wasn’t that appalled or horrified that he would explain to the fans why they had been led down the aisle with Dubai only to be jilted at the altar. This was turning into an episode of Dallas. Oil men, Texans, big hats, power struggles, back-stabbing and David Moores’ shoulder pads. All it needed was Victoria Principal, but principles were in short supply.
And so, as we looked on that February day, DIC cast as mugs for letting this golden opportunity pass, the Americans seen as liberators, handing out nylons and chewing gum to a grateful public, all seemed once again right with the world.
We didn’t even pay too much attention to the vague figures being bandied about.
They’d paid an initial £108 million for a 62 per cent shareholding, and after buying the remaining shares that price would rise to £174 million. They’d agreed to pay off the club debt of £44.8 million and vowed to put £215 million towards the new stadium.
No one was asking serious questions about where the money had come from, or why it was being lent on a one-year agreement, even though Hicks was thanking RBS for all their help. But then, as Parry had assured us, you only sell the family silver once, so even their most ardent critic gave them the benefit of the doubt that they had the guarantees locked in a safe.
Parry told anyone who asked that they had it in writing that this was not a Glazer-type deal, that they weren’t borrowing against the club. But there was no such legal guarantee. The small print in the shareholders’ document gave them the option, as owners, to borrow against the club at a future date. In other words, these strangers had simply been taken at their word.
Words like this, from Gillett, who weeks earlier was being dismissed – to borrow the famous lyrics of Roger Miller – as a man of means by no means: ‘This isn’t about making money,’ he said at the takeover press conference. ‘This is about winning and passion and tradition.’
When the man who’d allegedly brought the dollars to the table was asked if he’d ever even heard of Liverpool before this week, Hicks replied like someone who’d spent five minutes studying Wikipedia on his BlackBerry, during a mid-morning crap: ‘I had obviously heard of Liverpool, yes. But when I had a chance to read about the 118 years of history, the eighteen championships, the bleak years of the 1930s and 40s, the revival in the 1960s and the tragedies of the 1980s, I was just awestruck by what this community had achieved.’
It was said the deal-clinching moment for David Moores came when he and his wife Marge had dinner with the Americans, and were bowled over by their charm. Moores said he realised then that he had found men of honour whom he could trust. Others said he felt far more comfortable dealing with down-to-earth folksy westerners than the rather aloof Arabs. Gillett was later to confide to a senior Liverpool figure that at the dinner, he and Hicks soon discovered who was in the driver’s seat, and worked their charm on Marge.
On the day of the takeover Moores stayed away from his beloved Anfield, choosing to watch the press conference on Sky, reportedly through very red eyes: ‘It’s very hard to think it won’t be my club any more,’ he said.
‘Having said that, I’m handing it over to safe hands. This is not someone coming over just to make a quick buck. They are in it for the long term because they’re involving their sons so they can plan for the future.’
Rick Parry said, ‘This was probably the worst day in David’s life.’
For now Rick. For now.
CHAPTER FOUR
‘If Rafa said he wanted to buy Snoogy Doogy we would back him’
– George Gillett
The blacked-out people carrier screeched up outside the 62 Castle Street hotel causing a stir in nearby Derby Square where dozens of fans were drinking themselves into the mood for that night’s Champions League semi-final. Chelsea were back in town for a repeat of Jose Mourinho’s It Never Crossed The Line thriller of two seasons previously, and despite being 1–0 down from the first leg, optimism surged through red veins.
When a Men In Black security guard emerged from the hotel to do a 360-degree glare in search of hit men or stalkers, the crowd rose from the steps of the Victoria Monument and darted through the Lord Street traffic to catch a glimpse of what looked like a serious American celebrity.
Had Dr Dre finally turned up to show his devotion to the Scouse cause? Would that other closet Kopite Samuel L. Jackson emerge in a red beret? No. This guy was way past A-List.
‘Tom, Tom, over here, mate,’ screamed fans filming on mobile phones.
‘Well in, lad, go ’ead,’ yelled others, breaking into an impromptu round of applause.
Hicks emerged blinking into the May sun in a dark suit with a red scarf round his neck, visibly taken aback by the wall of emotion outside the hotel door. As fans patted his broad shoulders he nervously brushed back his hair, posing for photos like an ageing crooner. When the crowd belted out a rendition of ‘We Love You Liverpool, We Do’, he raised his fist in the air, before swaggering triumphantly into his blacked-out car.
As it pulled away the applause and the singing rose to a crescendo. Three months into the honeymoon and Liverpudlians still loved Tom Hicks enough to give him their last Rolo.
Peter Hooton, lead singer of The Farm and lifelong Liverpool fan, was near Victoria Monument at the time and was aware that someone was getting mobbed.
‘Once I found out it was Tom Hicks, I was embarrassed. I thought “imagine hugging a neo-Conservative with a John Wayne persona, who would have nuked Iraq given half the chance,” so I found it cringeful to be honest. But you think “it’s European Cup semi-final day, and well, that’s just general euphoria.” Fans weren’t really looking into their background back then, they were just thinking, “well, these have got money;
we’re going to start competing with Chelsea in the transfer market.”
‘I didn’t blame anyone for doing that. I just thought they were a bit naive for doing it because after a few months in charge the Yanks hadn’t done anything other than put on a Liverpool tie and smile.’
Journalist Tony Barrett, then a feature writer on the Echo, witnessed a scene which surely had the fans who took pictures of their new hero later scouring their hands with bleach and dousing their SIM cards in battery acid:
‘You know what, it felt right. Absolutely right. Although I don’t agree with clapping people from the boardroom. But we were in the European Cup semi-final and these were the people who were going to build us our new stadium and buy all these new players. No misgivings about them had been made public. No-one had said these people are bad for Liverpool FC.
‘You have to remember that Liverpool fans had always had a good rapport with their owners. We never sang a “sack the board” chant like Newcastle. Evertonians were far more cynical about their owners than we were because we always thought even if they got things wrong, their heart was in the right place. If I’d viewed that scene cynically I could have written it but I didn’t have a shred of cynicism.’
Those at the club who had to deal with the Americans felt roughly the same way at the time. But looking back, some recall small doubts niggling away when they sat down with Hicks and Gillett and discussed football.
On the Monday before the takeover Rick Parry took the pair to meet Steven Gerrard and Jamie Carragher at the Lowry hotel in Manchester where they were away with the England squad. Steven Gerrard recalls being excited at the prospect of seeing them and buzzing with optimism afterwards: ‘I thought it might be interesting to hear what they had to say and it was. They made promises and they were very convincing. They told me and Jamie what they did in America, about their businesses, etc. But to be honest I’d already Googled to find out about them so I had a rough idea.
