FSG reportedly prepare Liverpool for sale by prioritizing debt settlement

According to journalists linked to the club, Liverpool appear set to maximize Fenway Sports Group’s return if – or if – they are sold.

There is bad debt in the sports world and good debt. Bad debt uses the value of the club to fund its purchase, as was the case with former Liverpool owners Tom Hicks and George Gillett who nearly bankrupted the Reds.

Good debt means, at least from a business perspective, borrowing to selectively add value to the club over the long term, rather than diverting existing cash flows to do so. That was Fenway Sports Group’s aim when it made subsidized, interest-free loans available to Liverpool. Basically, the idea was that it would allow the club to redevelop Anfield and a new training ground, increasing its value, but then the club would pay off the loan over time rather than the money for those projects upfront.

On paper, FSG end up in good long-term debt to a club worth more and Liverpool’s ability to compete isn’t taking a hit in the short term. However, David Lynch, a journalist associated with the club, now suggests that repaying those loans over a shorter period of time should take priority over investment in other areas, including playing staff.

There is only one plausible target for such action – a sale, and one that will come sooner rather than later, as such an approach could hurt the club’s long-term value if on-field results decline over an extended period of time.

If FSG can now recoup the money it borrowed to redevelop Anfield and build new training facilities, it will have value added and debt removed. In short, it will maximize your returns. But he will do so by returning to the unspoken promise made when he loaned the club funds to improve infrastructure – that they did so using good debt.

If the reports are correct, the club are now being asked to use their revenue streams to pay for these short-term upgrades – upgrades that add sales value for FSG – at the expense of short-term investments elsewhere.

Given FSG’s promises when buying the club and over the years as owners, to call this a disappointing development would be an understatement. But it’s also a development that means that, willy-nilly, a sell – and probably an outright sell – is the short-term goal.

Also…

The Reds promise to make up for lost business this summer – Jamie carragherkmm

Jamie Carragher sympathizes with Liverpool fans’ frustrations over the club’s indolence in January, he is also keen to point out that club owners are happy to wait for a specific target to become available in a model that is the envy of Europe.

“From a medical point of view, they had a very bad season in terms of injuries,” Carragher said.

“Sometimes it can be bad luck, sometimes it’s the way injuries are handled, who’s involved. They didn’t replace a doctor (Jim Moxon) who left over the summer, whether that was a problem or not. , i’m not sure but they were really unlucky and they have to sort this medical service out somehow. “In terms of transfers, I can understand the frustration of Liverpool fans when they see other clubs spending money left, right and centre, and with Liverpool not signing anyone, it almost looks like they have this fight on the top four dropped.

“But what I never wanted my club to be the way it was when I was a player is a bit of a scattergun that repeatedly freaks out as Liverpool have been a role model for other clubs in the world. over the past four or five years, it was across Europe wanted to follow.

“And what they don’t do is freak out in the transfer market and I think Jurgen Klopp has shown that before, when he’s had some really successful purchases, he’s picked up like Virgil van Dijk. he was waiting for before going to look for it.

“If Liverpool don’t bring players in now because they don’t have the money or the player Klopp wants isn’t there, that’s a completely different argument that we don’t know, we’re not. unaware of this information.”

However, Carragher says it is unfair to criticize FSG for not strengthening in midfield when they tried to bring in Aurelien Tchouameni from Monaco and that they would have changed to Jude Bellingham if Borussia Dortmund had expressed interest last summer in selling the England international.

Jude Bellingham

Bild TV presenter Valentina Maceri previews Harry Kane’s potential move to FC Bayern Munich this summer and will Bellingham leave Borussia Dortmund or stay? As a result, the former Liverpool defender believes the Americans will make up for their recent lack of spending by pumping in some cash this summer, with the Reds still pushing to sign Bellingham.

“I’m confident Liverpool are going to have a great summer, I’m sure a lot of fans want them to have a great January, but I don’t want Liverpool going back to what they were doing when I was playing there. , where you would buy players and hope it works,” he added.

“It doesn’t mean I’m right or the club is right about Klopp, but I think it happened last summer and they knew exactly what they needed to do in midfield and they tried to sign Tchouameni and he left for Real Madrid.

“I think Liverpool were on the scene last summer, they almost won four trophies and they were in the Champions League final, so they probably thought they had to be special for us to have a player and they felt that Tchouameni was the player and he is going to Real Madrid.

“It is obvious that they have been working on the transfer of Jude Bellingham for a long time. They [Dortmund] didn’t want to sell him last summer, so maybe they thought we should wait until the summer and the midfielder could help us.

Bild TV presenter Valentina Maceri previews Harry Kane’s potential move to FC Bayern Munich this summer and will Bellingham leave Borussia Dortmund or stay? As a result, the former Liverpool defender believes the Americans will make up for their recent lack of spending by pumping in some cash this summer, with the Reds still pushing to sign Bellingham.

“I’m confident Liverpool are going to have a great summer, I’m sure a lot of fans want them to have a great January, but I don’t want Liverpool going back to what they were doing when I was playing there. , where you would buy players and hope it works,” he added.

“It doesn’t mean I’m right or the club is right about Klopp, but I think it happened last summer and they knew exactly what they needed to do in midfield and they tried to sign Tchouameni and he left for Real Madrid. “I think Liverpool were on the scene last summer, they almost won four trophies and they were in the Champions League final, so they probably thought they had to be special for us to have a player and they felt that Tchouameni was the player and he is going to Real Madrid.

“Obviously they’ve been working on Jude Bellingham’s transfer for a long time. They [Dortmund] didn’t want to sell him last summer, so maybe they thought they’d wait until this summer and mid-term. terrain will allow us to pass.”