Wednesday’s High Court ruling against Liverpool owners Tom Hicks and George Gillett, who were attempting to block the sale of the club, was a major boost for the whole Anfield community.
Had the aptly named Mr Justice Floyd ruled in favour of the Americans, it would have been a fatal blow for the 18-time league champions who were left staring down the barrel, with the threat of administration and a possible nine point deduction looming.
The club’s long-suffering supporters, who have been campaigning tirelessly for the despised American duo to sell up, look to have finally got their way. Mr Floyd’s decision will allow chairman Martin Broughton and his fellow board members to complete the club’s sale process over the next few days. And despite Hicks and Gillett’s best efforts, it looks like their days at the club are finally numbered.
Given the lack of respect the American owners have shown for Liverpool over the last three-and-a-half-years, it comes as no surprise that they were prepared to jeopardise the club’s future in the courts. They risked the club entering into administration and suffering a nine point deduction in an attempt to avoid making a heavy loss on their disastrous Merseyside investment. Had Hicks and Gillett managed to hang onto the club this week, then the threat of insolvency could have become a harsh and true reality.
The duo (Kop Holdings)were due to either refinance or pay back their £240m debt to the Royal Bank of Scotland on October 15, something which neither partner had the capital to do. This could have led to RBS taking control of Liverpool, placing the club’s parent company, Kop Holdings, into administration. Portsmouth became the first ever Premier League side to enter administration last March and were immediately hit with a nine point deduction as punishment. The same critical sentence could have also been forced on Liverpool.
After just one league win and six points from the opening seven games, a nine point deduction would have left the Reds with a perilous -3 points and nine adrift from the Premier League safety zone. While this difference could be made up over the course of a season, it would have ultimately been a disaster for a Liverpool side which finished second just two seasons ago. Key players would have almost certainly abandoned ship in January and it could have left the club stuck in the doldrums for another two decades.
Yet perhaps the most worrying aspect of a possible deduction would have been Red Sox owner John W.Henry and New England Sports Ventures’ insistence on walking away from the deal had the club fallen into administration. This would have left the club’s owner search back at square one and unprotected against bids from more investors in the shape of Hicks and Gillett.
Although, there is one more twist in the tale. Singapore businessman Peter Lim, who narrowly missed out to Henry in the first round of negotiations, has lodged an increased £320m offer for the club. Broughton and his colleagues will now decide between the two bids, with NESV still in pole position to clinch a deal. Chairman Broughton, mobbed by fans outside court on hearing the decision, admitted that he was elated with the outcome after warning last week about the serious impact administration would have had on the club.
“Going into administration needs to be avoided at all costs, as the negative impact would be catastrophic,” he said.
“Setting aside the nine-point deduction, it would have an impact on Liverpool’s value and be wide open to predators, whereas we have what we believe is the right new owner to take the club forward.”
The club will look to move up the table now that administration has been avoided and a new owner will give Liverpool the impetus and stability needed to go forward and rebuild from the foundations. Prospective new owner Henry was delighted by the decision, telling his Twitter audience:
“Well done Martin, Christian & Ian. Well done RBS. Well done supporters!”
A win in the Merseyside Derby for Liverpool on Sunday would top off the perfect week for a club which had been on the brink.