By Nick Harris

10 March

As least two potential investors in Liverpool are stalling on making offers for a share in the club in the expectation that Rafael Benitez’s team will fail to qualify for next season’s Champions League, forcing the current owners, Tom Hicks and George Gillett, to make a cut-price deal in the summer, sources with insider knowledge of the search for new cash have told sportingintelligence.

It is understood that at least one interested party is American, while another is “from the East”, although contrary to some reports, not from India. There has been “no serious interest in a purchase” from the sub-Continent to date according to those with working knowledge of the hunt for new finance.

Abu Dhabi has been mentioned in City circles as the source of some interest. Sportingintelligence has confirmed only that one group is US-based. This group has been in active talks in recent weeks, but has now taken the view that waiting holds potential advantages, and is keeping a “watching brief”.

An impeccable source has told sportingintelligence: “Liverpool’s owners are not anywhere close to a deal to sell a major stake in the club. There is some way to go yet.”

The source said the value of the club to potential investors does not lie in whether Liverpool qualify, or not, for the Champions League in any single season.

“The value in the club lies in Liverpool being one of the leading football brands in this country [Britain] and around the world, and about being inside the top four in the Premier League over the long term.

“Would missing out on the Champions League put pressure on the owners? It would certainly be better to qualify. Qualification is not necessarily the best outcome for would-be investors”.

Received wisdom has it that if Liverpool – in action in the Uefa Cup tomorrow – fail to finish in the top four, and miss out on the Champions League, this will harm the search for new money.

In fact it will harm Hicks and Gillett most because they cannot afford to retain ownership and fulfill their stadium plans on their own. With 50-50 control and no new external capital, an extra hole in next season’s budget could force them out.

The pair need to repay £100m to RBS Bank by July of outstanding debts that managing director Christian Purslow said recently stood at £237m. In a recent meeting with the Spirit of Shankly fans’ group (SoS), Purslow made plain that Hicks and Gillett need to find £100m by the summer.

Two versions of the minutes of the Purslow-SoS meeting exist (and both are published on the SoS website), and they differ in some areas. But even in the uncontested version, Purslow is quoted as saying:

One of our key priorities is to reduce the debt by £100 million. This is a requirement from our bankers and will allow us to look at a more flexible and longer term refinancing with our bankers when this investment is brought in. Ideally we would like a three- or four-year refinancing deal rather than the shorter ones we have had recently.

The targeted reduction in borrowings was agreed by the bank, CP and the owners when I was appointed.
The £100 million investment will be made by the issuance of new shares, and will not go towards anything else other than paying down the debt, reducing it to £137 million. This new investment will also mean a dilution of the current ownership.

Hicks and Gillett still believe they can find an investor willing to pay £100m or more for a stake in the club below a controlling holding. But the lack of interest in that proposition has been self-evident.

The Americans are understood to have been told by at least one professional source of advice that their best hope of finding new money while staying involved themselves is offering at least a 50 per cent stake (and controlling interest) to a third party. The upside to this for an investor would be control, but not at the full cost of the club. The upside for the current owners would be to stay involved at less cost to themselves.

Other Liverpool insiders insist there are still new partners out there who want to work with Hicks and Gillett – and are in ongoing talks – but deadlines set by Purslow for new money to come have already come and gone. Instead there are interested parties waiting for Liverpool to stumble in the run-in, knowing Hicks and Gillett will become susceptible if they do.

Purslow’s last public utterance on the subject was that money would arrive by Easter but this looks highly unlikely. And while no new money is forthcoming, so the proposed new stadium – which by general consensus will underpin genuine significant growth for the club in all areas – is no nearer being started.