Blow for Hicks in refinancing plan

Tom Hicks’ s plan to refinance his loans and place himself in sole control of Liverpool has hit trouble.  This will come as welcome news to Liverpool fans who had made it clear that they did not want the controversial American to remain in charge at Anfield.

Tom Hicks’ s plan to refinance his loans and place himself in sole control of Liverpool has hit trouble.  This will come as welcome news to Liverpool fans who had made it clear that they did not want the controversial American to remain in charge at Anfield.


Hicks had approached GSO Capital Partners, the debt restructing arm of private equity group Blackstone, to secure the funds needed to repay the £237m outstanding to the Royal Bank of Scotland.    It would have been a high interest loan similar to the PIK notes taken out by the Glazers when they bought Manchester United.  Apparently a deal had been agreed in principle, but nothing was agreed and Blackstone have walked away.


Stephen Schwarzmann, chief executive of Blackstone, received about 7,000 e-mails over the weekend from fans hoping for support.   However, GSO decided not to proceed for financial reasons, concluding that the deal was not economic.


In any case the Liverpool board was likely to block the plan.  The three other directors (other than the two Americans) resisted a previous proposal by Hicks in June after taking legal advice.  However, it might be difficult to stop Hicks from retaining his stake in the club if he mortgages other assets, such as his US property group.


One interpretation of Hicks’s latest refinancing attempt is that it is a bid to play for time until a credible buyer comes along.  He is still keen to sell, but wants what he regards as a good return on his investment which means a sale price of at least £500m.


Roy Hodgson has talked of a cloud hanging over the club.  Liverpool are just above the relegation zone.   No doubt they will pull clear, but their chances of securing a Champions League place is now in jeopardy.   Events off the pitch are affecting what happens on it.