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Liverpool could change hands for the second time in a year as their American owners run into difficulties in refinancing £350m of debt incurred in taking over and running the club. Beset by the steeply rising costs of a new stadium and manager Rafa Benitez's demands for new players, Tom Hicks and George Gillett Jr. have been attempting to transfer the debt, for which they are personally liable, on to the club itself. City sources believe this is an extremely difficult task to complete before the loan's due date at the end of February. It is possible that the Americans will meet the deadline, but if not an Arab investment group, Dubai International Capital, is understood to be lodging an offer to buy out the American pair, probably for about £500m. Takeover discussions are thought likely to take place before the end of the month.
DIC were extremely close to buying Liverpool last February, only to lose out to Hicks and Gillett when the club's chief executive, Rick Parry, switched his support from the Arab camp to the American. They paid £174.1m for a 100 per cent shareholding, also agreeing to take on the club's then debt of £44.8m. The purchase, however, was funded solely with borrowed money. Hicks and Gillet's loan from the Royal Bank of Scotland grew to £350m as it was used to fund several summer transfers, the architect's plans for the new stadium in Stanley Park, and to roll up the interest on the debt. The RBS loan is due for repayment next month. It would appear that attempts to restructure have so far failed and the Americans have yet to inject new equity into the refinancing. While RBS have asked Hicks and Gillett to each commit £20m of their own cash to the deal. City sources have suggested that at least one of the pair is not prepared to do so.
Work on the new stadium has been held up by the impasse over the acquisition loan, with no chance of funding being put in place for the £400m stadium project until the issue is resolved. The global credit crunch has made it harder for Hicks and Gillett to raise new revenues elsewhere and also affected the value of their own assets. Should they fail in their efforts to repay the £350m acquisition debt when it comes due in just over six weeks, there is an outside possibility of the next owner of the club becoming RBS, but the Bank are unlikely to allow the situation to develop that way. The failure to bring financial stability to the club is believed to have led to increasing tensions between the Americans and other board members as the refinancing deadline approaches. DIC remain as interested in buying Liverpool as they were one year ago and appear best placed to resolve the financial problems affecting the club's competitiveness in the Premireship. It might be possible to do a deal which would allow the Americans to exit with a profit of £75m each.
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