Liverpool owner is delaying DIC plans

Dubai International Capital’s (DIC) “interest” in Liverpool is on hold as Tom Hicks, one of the club’s American owners, tries to sell off a percentage of his sport businesses.

Hicks is seeking an off-market placement of existing shares in Hicks Sports Group, which includes investments in Liverpool, the Texas Rangers baseball team and the Dallas Stars ice hockey franchise.

Investment bankers JP Morgan have been advising on the listing, which was first attempted in January, but failed because of challenging financial market conditions. JP Morgan representatives are understood to have visited Liverpool in the past fortnight to work on the placement plan.

DIC is reportedly set to launch a bid to purchase the club as early as this month, after discussions took place between the Americans and DIC officials in Dubai and London last month.

Speculation has been rife for some time that Hicks and George Gillett, who bought Liverpool for around £220 million (Dh1.4bn) in January 2007, wished to sell the club for a quick profit.

Hicks’ current 50 per cent share of Liverpool is thought to be fundamental to the bid exercise. DIC’s interest in Liverpool has helped the football club’s value to rise during a period in which American companies with sporting assets have declined sharply in worth.

Commenting on the recent limbo status of the deal, Tony Livesey, a sports TV personality and ex-editor of Sunday Sport, said: “Uncertainty on such decisions does reflect on the performance of the team and eventually it will cost a fortune to the club.”

Emphasising his point, Livesey said that while DIC would prefer to buy Liverpool in full, the Gulf investment group is currently concentrating its efforts on purchasing Gillett’s half share in the club and then establishing an agreement with Hicks, which would allow it full control of Liverpool’s day-to-day operations.

Hicks has engaged in talks with DIC over a proposed management structure in case of a purchase.

Though it has been suggested that Hicks is attempting to raise funds to buy out Gillett and take total control of Liverpool, such a move would cost around £300m in equity and loan guarantees.

 

Hicks is not thought to have the resources to cover such a transaction, while his moves to place shares in Hicks Sport Group would effectively reduce his stake in Liverpool, making him a seller rather than a buyer.

Now it seems the Americans are all set to cash in, although there could be some haggling over the price. The Americans reportedly now value the club at around £400m, which would cover the £350m debt they recently took on as part of a refinancing deal for Liverpool.

The numbers

£200m

£400m