Liverpool agree sale but legal battle ahead

The Liverpool board has agreed to sell the club to the owners of baseball's Boston Red Sox but the fate of England's most successful side could yet be decided in the courts as a bitter ownership dispute rages on.  

The English Premier League club said on Wednesday it had accepted an offer from the New England Sports Ventures (NESV) but the deal is unlikely to be a straightforward one as the club could first face a legal challenge from its current owners.

On Tuesday, Americans Tom Hicks and George Gillett sought to replace two members of the five-man board with their own people in a final bid to retain control with the BBC quoting the pair as saying they would resist any sale that undervalued the club.

Local media reports have suggested the Hicks and Gillett were looking for around £600 million but the proposed deal for the debt-ridden is worth £300 million.

The Americans would also not have been happy to discover that sale to NESV has the support of the club's major creditor Royal Bank of Scotland (RBS), according to a source familiar with the situation.  

Liverpool chairman Martin Broughton said he was disappointed the current owners had "tried everything to prevent the deal from happening" but added the agreement offered a good solution for a side enduring its worst start to a season for more than half a century.  

"I am delighted that we have been able to successfully conclude the sale process, which has been thorough and extensive," Broughton said in a statement on the club''s website (www.liverpoolfc.tv).

The legal dispute over board membership will be a key part of whether the sale actually goes ahead, although with an Oct 15 deadline looming for the RBS debt to be refinanced, advantage seems to be with the prospective owners rather than incumbents. 

The five-times European champions owe £237 million ($377.3 million) to RBS, who could decide to take effective control of the club if the date passes without payment.

On Tuesday, Hicks and Gillett attempted to remove managing director Christian Purslow and commercial director Ian Ayre from the board and replace them with Mack Hicks and Lori Kay McCutcheon.  

Unpopular owners                                          

"The legal battle is critical," said Wyn Grant, professor of football economics at Warwick University. "If the NESV deal doesn''t go through RBS may ultimately intervene.                                           

"I think RBS would be prepared to extend the loans for a short while to allow the sale to go through without putting the club into administration but if it's all held up too much they might just pull the plug on Hicks and Gillett, meaning the club would be available for purchase anyway."                                           

The club would face a nine-point penalty if it went into administration -- which would take its Premier League tally to minus figures as it has six points from seven games and is lying in the relegation zone.

Hicks and Gillett bought the Merseyside club in February 2007 for £218.9 million($347.5 million) and have been unpopular with fans for burdening the club with debt, leaving little money in the transfer pot.

Fans have held many protests calling for their departure, blaming the club's poor on-field performances on a lack of new players and were nervous that they will be getting yet more American owners. 

"We welcome the news that there could be new owners. But there is cautious optimism about whether the deal will go through," James McKenna, a representative of the Spirit of Shankly supporters group, said.                                           

"Supporters will be looking at how they are going to finance it and how they are going to pay for the new stadium. We've heard all these promises before and it amounted to very little."

Broughton sought to allay such fears, pointing to NESV's track record with the Red Sox.  

"The board decided to accept NESV''s proposal on the basis that it best met the criteria we set out originally for a suitable new owner. NESV''s philosophy is all about winning and they have fully demonstrated that at Red Sox," he said.

NESV is headed by John W Henry and Tom Werner. In 2004, two years after they took over the Red Sox, the team won their first World Series since 1918. They then secured the title again in 2007.                                                                                   

Immensely impressed

Hicks and Gillett instructed Barclays Capital in April to find a buyer and appointed British Airways Chairman Broughton to oversee the sale.           

There were no financial details of the agreement, which will also need Premier League approval, although Broughton said the offer would allow the club to focus on investment in the team because it removed the burden of acquisition debt.                                            

"We've met them in Boston, London and Liverpool over several weeks and I am immensely impressed with what they have achieved and with their vision for Liverpool Football Club," Broughton added.

Fans will hope that means there will be money for a planned new 60,000-seater stadium as well as new players who can take the club back to competing with the likes of league leaders Chelsea, Manchester United and big-spending Manchester City.