KopTalk.com Forums Football Liverpool FC Forum Lfc to avoid points penalty if RBS takes over

Liverpool FC are likely to avoid a Premier League points deductions even if the Royal Bank of Scotland takes over the club.

The Reds face the very real possibility the bank could grab control by the middle of this month if American owners Tom Hicks and George Gillett fail to pay the £237m debt.

Some football legal experts have predicted that Kop Holdings, which owns LFC, would automatically be placed into administration.

But the ECHO understands the Premier League would not view that move as Liverpool being declared insolvent.

Regular discussions have been taking place between Liverpool chairman Martin Broughton and league chief executive Richard Scudamore.

The Reds have been seeking clarification on the potential scenario if RBS took temporary charge at Anfield.

Sources have indicated a nine point deduction, threatened to football clubs when they go bust like Portsmouth last season, would not materialise.

League chiefs crucially consider the debt to rest squarely on the shoulders of Tom Hicks and George Gillett, co-chairmen of the club and owners of Kop Football Holdings.

And as Liverpool has proved they have steady revenues - TV rights money, ticket sales, sponsorship - the club would avoid incurring any penalty.

The Reds reported a £200m turnover for the first time during the last 12 months, a significant rise compared to previous financial years and Anfield bosses insist the club remains highly profitable.

Lawyers closely watching the process, meanwhile, disagree over the possible outcomes and acknowledge the Reds are entering previously unchartered legal territory for the Premier League.

One urged caution citing the example of Southampton who were docked league points after claims that their parent company, and not the club, had gone bust, were dismissed by the Football League.

But a source familiar with the process told the ECHO: "A deal's been done to make sure those nine points aren't deducted from Liverpool.

"It's not actually the football club that goes into administration, it's the holding company.

"If it's only the holding company that goes under, that's when they've got clearance. The deal has been done between the club and the Premier League.

"The whole point of the points deduction is that it's unfair if the company goes under they abandon loads of creditors and start again so they are in a beneficial position compared to other football clubs.

"In this instance I suppose, what they would be arguing is that there aren't abandoning their creditors because their only creditors are just the bank, RBS, and they'll get paid out anyway."

Steve Horner, however, of Liverpool FC campaign group Kop Faithful, said the prospect of a nine-point deduction would not worry him if it meant getting rid of Hicks and Gillett.

The surveyor added: "We just want them to go. Their ownership period has been disastrous for the long-term future of Liverpool."

another "middle of this month" promise. it seems to be the middle of every fcking month.

I thought it was 6th Oct?

Well i guess thats a good thing but thats IF the bank takes over.

old news

from todays echo

And you think newspapers dont print old news? Why regurgitate regurgitation I would go and dig up the original but its friday night you know what i mean like

no i don't know what you're talking about...

ok i had time... Early September news of the screws

http://liverpoolfc.co.za/eve/forums/a/tpc/f/1126051643/m/495103019

Liverpool will not lose 9 points if they going into administration
by Chris Bascombe, News of the World

Liverpool will avoid a nine-point penalty if they fall under bank ownership next month.

The Premier League will approve an Anfield takeover by the Royal Bank of Scotland if co-owners Tom Hicks and George Gillet don't find a buyer or repay their debt by October 6.

The RBS has had power to seize the club before but there were concerns about league sanctions. Fans feared that if the Americans defaulted on their loans the club would be plunged into administration, leading to a nine-point deduction.

And that would almost certainly end their hopes of qualifying for the Champions League with devastating consequences for the club.

But clarification that a bank takeover is within Premier League rules is of huge significance. It means the league recognises the distinction between the owners' debts and the club's debt.

The Americans face catastrophic financial losses in the region of £300m if they miss the October deadline.

Hicks and Gillett still owe their 'acquisition debt' - currently £282.4m - which they used to buy Liverpool in 2007 as part of the company they created called Kop Football.

But that company exists independently from profit-making Liverpool Football Club and Athletics Grounds Limited, whose accounts are sent to the Premier League.

If the bank takes over, the owners' existing debts will be wiped out but they would lose the club without receiving a penny.

An RBS takeover will enable the bank to deal directly with buyers from next month and sell the club for a reasonable price.

The Kop is now braced for one of the most important months in its history.

Hicks and Gillett desperately want more time from the bank, but Managing Director Christian Purslow, Commercial Director Ian Ayre and Chairman Martin Broughton have urged RBS to refuse another stay of execution.

The bank, club and Premier League still hope a last-minute takeover will prevent the need for bank intervention.

RBS wanted the club sold by last Tuesday and imposed strict penalties on Hicks and Gillett to force a sale. A final charge of £7.5m was made on August 31, after earlier penalties of £5m on July 15 and £7.5m on August 15.

But there is no immediate incentive for buyers now the transfer window has shut and the refinance deadline looms.

A few months ago Hicks' boldly valued Liverpool 'between £600m-£800m', though sources close to the owners dispute any such valuation.

The owners tried to refinance in June using the club's assets but were blocked by the rest of the board. Securing new loans against their US assets is another avenue they're pursuing.

But if Hicks and Gillett are unable to raise funds, they're faced with a startling choice. They could accept a minimal profit if a bid materialises or lose the club for nothing.

But a source close to the sale process warned: "This is a little like one of those horror movies. Just when you think the monster has been killed in the final scene, he somehow gets back up again."

i believe u mate. well im off now...