Author Topic: The Rough Guide to the Thai Take Away  (Read 3637 times)

Offline Rushian

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The Rough Guide to the Thai Take Away
« on: May 11, 2004, 06:37:08 am »
With reports of a possible massive investment in LFC by the Thai PM flying back and fore over the internet, newspapers and media sources, things are pretty confusing for many fans.

We've spoken to a lot of Reds today and there's a whole range of emotions at play. Distrust of anything new or considered "exotic". Wariness at the Amnesty International reports on Thailand under the Prime Minister Thaksin Shinawatra (though as has been pointed out the UK doesn't brush up too well on this front with Amnesty). There's also a preference among some to see a local man in Steve Morgan invest in the club (though serious concerns over his views on a ground share remain). Some fans are happy just as we are, and don't want to see us go down a share issue route.

It has become apparent that no one knows exactly what is going on because of the slow drip drip feed of details we're getting from both the club and the other side of the globe. So we thought we'd try and clarify a few issues.

We think it is safe to assume that the money mentioned in all the reports (anything between £55m and £75m) will come from investment in unissued shares in the club, not from the purchase of shares currently owned by any individual or group. This is an important distinction. Funds paid for unissued shares go into the LFC bank account. Money paid for currently owned shares goes directly to the seller - be it David Moores, Granada, Steve Morgan etc

According to the latest accounts there are 50,000 authorised ordinary shares in LFC. However only 34,823 of these are allotted, issued and fully paid-up shares. If the Board so chooses it can authorise the issue of the 15,177 unallotted shares (30.3% of the overall number of shares), at an agreed price, and the money will then go to LFC not any individual. This would reduce David Moores shareholding to around 36% and still leave him as the largest shareholder.

Our best guess would be LFC would issue most of these 15000 shares, say 13000, leaving the Thai investment around 27-28% and Moores at 38-39%.

Granada's investment is 9.9% and is pegged at this amount by rules governing media ownership of football clubs which were formulated after Sky's attempted takeover of Manchester United . It's been rumoured for a number of months that Granada want to dump both their Liverpool and Arsenal investments (they own 9.9% of each club). However there are joint merchandising and commercial deals set up between LFC and Granada (dvds, videos etc), described as a strategic partnership, and there's also Granada's 50% share of liverpoolfc.tv to consider. When Moores sold those shares to Granada there were almost certainly restrictions applied as regards voting rights, the disentanglement of the commercial deals if needed and who the shares could be sold to in the future.

Steve Morgan owns around 5.2% and sources we have contacted today suggest that he hasn't approached Granada to buy these shares. Morgan's offer to underwrite a 50m share issue was turned down by Liverpool in the first instant (as revealed in a statement issued on behalf Morgan by Active PR), and is believed to have come with certain strings attached that the club felt were unpalatable.

Rick Parry's brief statement on the official site yesterday suggests the current Thai talks are just one of a few options the club at looking at (along with Hawkpoint Partners who have been appointed to advise on the financial future of the club). Parry was also in the States the other week on a long business trip which hasn't received much publicity but we believe may also be connected to future financial investment opportunities.

Other issues to consider. The club will almost certainly have to call an EGM to authorise a share issue. With David Moores owning 51% of the shares the issue will be obviously be approved but the meeting may become the focus of protests. There's also questions as to who exactly the Thai funding is coming from. Is it all from Thaksin Shinawatra and his Shinawatra Computer and Communications Group? Does the Thai Government intend to invest some money? Will one of the other investors be Charoen Sirivadhanabhakdi, owner of Beer Thai? This may cause problems as Beer Thai is the producer of Chang Beer and Chang and Carlsberg (our current sponsors whose deal runs out in 2005) have been in serious dispute over a previous joint venture and are said to be suing Carlsberg for $2 billion.

There's also a question of what the Thai's will get from Liverpool. It's been suggested we will build and run an Academy in Thailand - who pays for the capital and running costs? Will we give merchandising rights for Thailand and South East Asia to the investors? There's also been talk of using Liverpool as a brand for Thai products.

If an investment of 65m is made, it's clear a large proportion of the money will be invested into the new stadium (if we ever get planning permission!) so "only" 30m will be added to the summer transfer pot. this will of course disappoint many who have been playing Championship Manager since the news filtered out, but has to be seen as the sensible option for the club.

To explain this further (all figures are indicative), we are intending to borrow 85m (plus interest) for the stadium to be paid off over 15 years at, say, 7m a year. The increase in capacity of 16000 brings in proposed extra revenues of 12m a year based on ticket sales, merchandise, corporate hospitality and food and drink. So after paying off our loan we get an extra 5m a year for the transfer pot over what we already have at the present Anfield site, and this revenue will kick in as soon as we move to Stanley Park.

Now if we invested 35m into the stadium from any share issue, we'd only have to pay back 50m plus interest. Now we could pay this back over the same time period paying say 4.5m a year, and thus benefitting in extra revenue by 7.5m a year. Or we could choose to pay off the loan at 7m a year but over a shorter time period and get the full benefit of the new stadium after just 8 years.

That's the situation as we see it currently. If you have any questions you can email us at:

lfc_isa@hotmail.com

Independent Liverpool Supporters Association
http://www.ilsa.org.uk/
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Offline Rushian

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Re: The Rough Guide to the Thai Take Away
« Reply #1 on: May 11, 2004, 12:50:32 pm »
We've now done a bit of digging and it seems Chang and Carlsberg are in arbitration over their former alliance.
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Offline Rushian

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Re: The Rough Guide to the Thai Take Away
« Reply #2 on: May 11, 2004, 01:00:49 pm »
Latest news from the Liverpool Echo:

Rival bids for Reds May 11 2004

WORLD EXCLUSIVE By John Thompson, Liverpool Echo

A RIVAL bid to invest millions of pounds in Liverpool Football Club was tabled today. Building tycoon and Reds fan Steve Morgan, (right), today submitted a second offer to invest £73m into the club.

It came just hours after the Prime Minister of Thaliand Thaksin Shinawatra claimed he had agreed a deal to pump up to £75m into the club following intense negotiations in the Far East over recent days with Chief Executive Rick Parry.

The new offer from the former Redrow chief follows his previous offer to underwite a £50m share rights issue, an offer he claims was immediately rejected. The second Morgan proposal, which was being formally hand delivered to Anfield shortly before noon today, would have two elements.

The first would see him underwriting a new share issue to the tune of £61m. The second element would see a further £12m of shares issued for the fans to buy, taking the total investment into Anfield to £73m, the bulk to be spent on improving the playing squad but some earmarked for the new stadiumplan.

Crucially, Morgan's new offer would now allow current chairman David Moores to buy some of the new shares. That means he could stay in control at Anfield, but with Morgan likely to gain a seat on the board too.

Until now such a scenario has been hard to imagine, with Morgan a long-termcritic of Moores. An associate of Morgan's said: "Steve's offer would generate £61m of new money for the club.

"A further 10% of new shares would raise £12m for the club which would be offered to rank and file supporters."

Morgan's offer is understood to price the new shares at £175 each. Nobody from the club was available to comment on either this morning's Thai announcement or the Morgan offer.
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Offline MichaelA

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Re: The Rough Guide to the Thai Take Away
« Reply #3 on: May 11, 2004, 02:11:14 pm »
It's going to be a long and messy summer.

Russian Marshik

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Re: The Rough Guide to the Thai Take Away
« Reply #4 on: May 12, 2004, 07:59:59 am »
Sorry for my English...

     I think, if Liverpools not stupid, Liverpool will let Thai PM take it, not Morgan.

     Yes Morgan can invest more money but that's it. The main points are...

1. Liverpool wasn't so success for the Marketing in Asia and Pacific . Thai Pm is one of world's successful Businessman and he has own businesses covering around Asia, especially communication's businesses and he has his own 3-4 Satellites. Liverpool now needs someone who can open it's power for Marketing in Asia and Pacific. But Morgan has nothing for that. Everything will be the same but it talks about further new marketing in Asia and Pacific.


2. If Thai PM will take, it's only 29.9%. David Moores still hold the biggest 36% and his partner - Granada 9.9%. So, I don't think that David Moores will be that stupid, to let Thai PM manage Liverpool then. 

Thank you

Offline MichaelA

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Re: The Rough Guide to the Thai Take Away
« Reply #5 on: May 12, 2004, 04:51:56 pm »
Any chance of fishing out some of the *established facts* from the Liverpool Forum, and putting them in this thread?

I'm getting old and holding all those threads open to find the post with the correct information is beyond my failing capabilities...