When Tom Hicks (above) and George Gillet acquired Liverpool F.C. in August of 2007, “all their talk was of cherishing Liverpool’s heritage, of the Kop, name-checked repeatedly by Hicks in his Texan drawl, of a golden future to replicate the glorious past,” write the Guardian’s David Conn. The financial evidence to the contrary, however, puts the club’s ability to compete at an elite level squarely on the shoulders of Rafael Benitez’ ability to find (relative) bargains).
The accounts released on Thursday, covering the year to 31 July 2008 for Liverpool Football Club and Hicks’ and Gillett’s holding company, Kop Football “ ultimately owned, naturally, in the low-tax US state of Delaware via the Cayman Islands “ set this out in black and white. In part the figures, revealing a £42.6m loss made in a bumper year when the club turned over £164.2m, confirmed what we already knew. The North American pair borrowed the £185m to take over Liverpool and although they promised in those choreographed public appearances not to “do a Glazers”, they have loaded the responsibility for paying those debts on to the club itself.
With £313m already spent of a £350m loan facility with the Royal Bank of Scotland and Wachovia few believe the new stadium will be built anytime soon, since that, too, has to be financed with borrowed money, currently projected at about £400m.
While Chelsea have Abramovich reaching into his pockets again, and Manchester City were bought by an owner blessed with an outrageous fortune, Manchester United and Arsenal have major borrowings to service too. Liverpool may not fall too far behind just yet if BenÃtez can spend his budget wisely this summer and has luck with injuries next season.
It is, though, difficult to see where the club can get to under the current owners. Even if the £350m loan is continued there are questions over Hicks and Gillett’s ability or willingness to fund the club further themselves. Two and a half years since the arrival of these “good” Americans, the new stadium remains on the drawing board, and Liverpool are servicing huge debts, including the £185m cost of being taken over by the pair in the first place. It is difficult to see quite how it all fits in with that rose-tinted commitment, made at the beginning, to cherish the heritage of Liverpool FC.