KopTalk.com Forums Football Liverpool FC Forum Turns out we aren't debt free...

No but as I said each part of the NESV group must service the cost of capital. The £3m interest sounds to me like working capital interest for running the club day to day. But an allocaton of the cost of serving the total aquisition capital will be put on each member of the NESV group. So say the interest paid by LFC for acquisition is zero but if it had been a standalone business it would have paid £20m. The beancounters in Boston will when preparing the profit and loss say LFC Profit say £50m less a notional interest charge of £20m so they will then say to JH you made £30m John. He ain't made £50m because someone somewhere has to pay the interest on buying the club or if they have no overdraft then the opportunity cost of the interest. E,g the interest they lost because the money is invested in LFC. Thats standard business practice anywhere. So I have always taken this debt free thing with a pinch of salt. At the end of the NESV will take off the cost of the interest in evaluating what future funds to allow.

doesnt suprise me we pay joe cole 90k a week to keep the bench warm - i seem to remember there was an issue about the 'debt free' takeover and there was a catch, as i think other people have mentioned, i think they have removed the old debt when buying but the new debt is 'normal' and part of lfc rather than kop holdings, either way i am not too worried as they have loaned out a lot of players are interested in buying younger players rather than 28- 29 year olds who are brought in on reputation, thats the future of football certainly for the next 3 years - its crucial now to have smart people in charge - ok a lot is taken on trust we dont know really who nesv are - but hicks and gillette especially hicks looked dumb and acted dumb god knows how these people get there money they must stitch someone up to g et it

Nesv/fsg/nesn have bought the club out right. That's all that matters. Nesv will have a bank account full of cash to invest it in whatever they like.

There not a mere bank like you've explained it to be. There the owners of our club and when and if they decide to sell up theyl make 100% profit like any single owner of the club, and share it with their shareholders (ie nyt, lebron James etc )

Thats the only way there going to make money off us. Every penny that Liverpool football club makes will go back into the club which will increase the clubs value, which is what nesv/fsg want in the longterm. 10 years I reckon

One point missing btw, theyve bought the club, not loaned it money !!

You have to look at it from the perspective of NESV all Liverpool are is an asset of NESV. The money has to come from somewhere and NESV paid a cheque £350m? to Gillet and Hicks. That money has to be financed if its Financed by NESV thats the same thing as LFC they are one and the same NESV own LFC lock stock and barrel. I can't explain it any easier. Unless I am missing something boys if so I hold my hands up.

It doesn't have to be financed at all mate. They've not borrowed money ie from banks etc or any of it's shareholders to acquire us. Theyve wrote a cheque of whatever the sum was. And it's come out of the nesv account. In that nesv account will be hundreds of millions the consortium has acquired over the years they've been operating in

The consortium has working capital in the 100s of millions and all in all is in the billions.

With regards to them making profit on Liverpool etc, look at how they run boston red sox. They are genuinely interested in winning, sure they take a profit from this and that but they spend massive on players and contracts for them, and aren't necessarily just business men looking for a 100% profit 10 years down the line sort of people. They genuinely want the red sox to win and spend massive to that effect. I imagine they are the same with Liverpool.

Thats not true money has a cost even if you have an overflowing bank account. Its basic accountancy and called cost of capital. Put it in your own personal circumstances say you had £50k in your savings account earning interest You then paid out £25k for a new car. You have lost the interest on the £25k and thats part of the cost of your new car. Where a company has funds you charge cost of capital for the use of the funds even if you are in the black. I am not making this up I do it for living. All large companies do it there is no dispute over it, its a fact.

their working capital is deffo in the billions john henry himself is now a billionaire again and i think there are 4/5 other billionaire's on the FSG board. and as people have said these are businessmen but they are here to win they loved making the red sox winners again and they will love making us winners again

THe point I made about and interest is I am 100% sure technically correct. The term debt free is nice to say but not true. But you are right John Henry is a billionaire and he will do what he wants so he can override the bean counters any time he likes its his money. But he is a businesman first never forget. But I will not be optimistic until I see the colour of his money not just on the team but on the club infrastructure.

We await....