Topic: Editorial: This sorry investment saga

[Rushian]

It is now nine days since the news broke that Rick Parry, Chief Executive of Liverpool FC, had flown to Bangkok to discuss a bid for 30% of the club with the Thai PM, Thaksin Shinawatra. Since then there's been rumour and counter-rumour from the Far East. Liverpool-born building magnate Steve Morgan brought forth his proposals, held a nationally televised press conference and briefed the press, and then saw his deal rejected as "not attractive". Now the Thais have emerged as favourites to seal a deal and are currently believed to be flying to the UK to agree the fine print and details.

This sorry investment saga is bringing no-one credit.

Firstly the club. It is understandable when confidential negotiations are taking place the club would wish to refrain from commenting. However they have allowed a vacuum to exist over the last week, which has resulted in conjecture and speculation filling the headlines and forming the opinions of the fans.

In this vacuum ideas on the nature of the Thai deal has been formed from snippets of interviews given 6000 miles away by various Thai spokespeople and the Thai PM himself. Similarly the brief statement rejecting the Morgan proposals as "not attractive" was unworthy of our great club and has been accused of misrepresenting Morgan's offer. How long would have taken a spokesman to come up with thirty minute presentation of what all this could mean for the club, to explain the ballpark figures of both deals, without going into confidential details? It has left fans angry and confused, as evidenced by banners against BOTH deals at the season-ending game against Newcastle.

The timing and speed of the deal has received wide criticism. The rush to complete the investment seems perverse at best. We're one of the richest clubs in the world and are more than financially viable. The timing, for what could have been a vital last week of the season, had inconvenience written all over it. Unless of course the timing was deliberate. A lack of games in the summer equals a lack of protests at the most visible outlet a fan can have.

The Thais have confused and frustrated at every turn. The source of funding has seemed to change by the day, starting with the Thai PM investing, then the Government and onto unnamed private and corporate investors. It now seems that the Thaksin deal will be half-funded by a stock issue to private investors and half by a glorified pub raffle for the people of Thailand. It's doubtful tickets will be sold in the pubs of L4. It's almost as if they made the offer and then realised they'd have to sort out a way of funding it. Hardly impressive to Reds.

The Thais should also realise that in repeatedly stating that if LFC turn down their bid they will be investing in another Premiership club, it strengthens already entrenched positions against their bid. Liverpool fans want investors interested in Liverpool Football Club not any old Premiership club. They also exhibit great unease at the mixing of State and sport. What happens if the Thai Government loses the next election and the opposition are uninterested in us?

The human rights issues, first broached with prominence in the UK by the likes of Amnesty International, cannot be glossed over. Serious concerns have been expressed by many fans and they need to be addressed. If the Thais do buy a 30% stake in the club then we will be inextricably linked with what happens in Thailand. Accusations against the Thais will have bad publicity sticking to the Liverbird like superglue. It cannot be good for the club.

Steve Morgan stands charged with playing the populist card after jetting in from his Jersey tax-haven for his Wednesday morning press conference. He reeled off a list of points he knew would play well. Hitched to games? Check. Bunked in? Check. Send a builder to hand in the proposal? Check. Want to win European Cup? Check. Whilst refraining from criticising the manager in front of the TV cameras it was clear in the next morning's newspapers where his feelings lay. Houllier out? Check.

He has also left the impression among many fans that he'd be personally investing £73 million in the club. This could and should have been explained more clearly by Morgan and Bridgemere. Not all fans work in finance or have the time to critically analyse the proposals from the rough outline given at the press conference. The points listed by Morgan should have been expanded upon. Morgan has also received stiff criticism from many for undervaluing the club and small shareholders appear extremely uneasy at the thought they'd see their current investment devalued through a rights issue.

The local press and media has at least covered the issue in some depth, but were slow to come to the party when explaining the proposals. By last Wednesday they were proclaiming 87% support for the Morgan bid in the City of Liverpool, yet it wasn't until Friday, after LFC had rejected the bid, that they'd explained the financial breakdown of his proposal in an article by David Prentice in the Echo that, to be extremely kind, "leant heavily" on an article published two days before on a fan website.

The coverage in the national press has been a competition in shallowness and nostalgia. One leading journalist pinned a sepia-tinted picture of Bill Shankly to his chest to condemn the Thai deal, and then wrongly attributed the quote from Shankly he had used as the base for his thesis. Another wrapped himself in the comfort blanket of Liverpool as a "family club", a description no fan who has had to deal with the club, and its ticketing structure, on a weekly basis over recent years would recognise. Tea and biscuits and a cosy atmosphere in the press box doesn't make LFC a family club. These were two of the finest sports writers in the country, so you can guess at the quality and paucity of the coverage elsewhere.

The fans, having been so poorly let down by those who should be providing unbiased and accurate information, have mainly fallen into extremes. Scouse v Thai. Progress v inertia. Human rights v Championship Manager spending. David Moores v Houllier sacked. Shinawatra has been caricatured as a diverse range of figures - from Pol Pot to an Asian Richard Branson. Steve Morgan has been glorified as Wacka, the Spirit of Scouse, and vilified as the Robber Baron preying on small shareholders. Reasoned debate has, in general, been thrown out of the window in the rush to judgement on the little information provided.

There are those who have suggested that the fans have no say in the investment issue. That we should sit meekly by and trust the board. Fans do, on the whole, trust the board however it is fundamentally wrong that they should be expected to sit quietly. The fans may not own the club financially (apart from the rare few with shares) but they do own the club both morally and emotionally. When these issues are at stake, and are questioned, they have to speak up. Fans' opinions do matter and should be taken into account, listened to and treated with the respect they deserve.

All the fans are asking for is honesty and openness from all parties. Is that too much when, after 112 years of history, fundamental changes in the club are imminent?

© RAWK 2004

[Gnurglan]

Excellent piece, Rushian.

[Barney_Rubble]

I'll keep reading you Steve.

Journalists....

[wellsie82]

good piece mate

All the fans are asking for is honesty and openness from all parties. Is that too much to ask for when, after 112 years of history, fundamental changes in the club are in motion?

that sums it all up for me, ive been bollocked by others on here before when ive made it known that ive not been happy with how the club keeps us up to date (or not as the case maybe) on what are sometimes important issues

all such a closely kept secret all the time "our" club.  from where im sitting it's another example of the club not "caring" about what we think in that they're keeping us in the dark so much

[Rashid]

A very good piece IMO but to be honest I wouldn't want a man on the board that everyone dislikes (according to this article). Wouldn't it be perfect of Moores and Morgan could patch things up?

Morgan: The End of the Line?

by leading Livepool FC author Stephen F. Kelly

It looks very much as if Steve Morgan's attempts to buy a larger stake in Liverpool Football Club have come to a premature end. There now seems little else that Morgan can do.

At Anfield on Saturday Morgan was totally ignored by every board member. While he was being congratulated by fans outside the ground, inside the Director's box Morgan cut a lone figure. Neither Rick Parry nor David Moores bothered to speak to him, and nor did any other directors.

As if that was not bad enough Morgan tells me that he has not heard a word from Liverpool. He's seen what's on the web site but again nobody has bothered talking to him. You would think that a man who is prepared to pour millions into the club might at least be given some official answer. But no, not even a letter, a phone call or an e-mail. Total silence. And that is no way for Liverpool to treat a man who is the second largest individual shareholder in the club.

There has been no attempt to negotiate. Nobody has said to Morgan, 'okay, we don't like bits of your deal but let's use it as a starting point. Can you change such and such, increase your value for each share by such and such…' Nobody has come to Morgan and said 'can you compromise, can you negotiate ?' He has simply been given the cold shoulder.

Morgan's problem is not just Moores. He has a huge problem with the board, most of whom are Moores supporters. There are eight directors including Moores. Terry Smith is a close friend of Moores and is always going to vote with him, Keith Clayton also, as the accountant who went to Bangkok with Parry, is a Moores man. The two Granada men - Burns and Cresswell - are always going to vote for whatever suits Granada although a new share issue will dilute Granada's holding. But you can take it that they will be voting with Moores. Rick Parry too isn't going to upset Moores. This leaves just Noel White and Ian Wheatley who might side with Morgan. That's six against eight. Not good odds and not much prospect of Morgan ever getting the better of that board. Even if he did win over enough directors, Moores can always pull rank and slap his 51 per cent stake on the table and tell them 'I have the biggest stake, therefore I win.'

So what can Morgan do now ? In truth, very little. He could of course make a bid for the Granada shares but that would mean money going into the pockets of Granada, or ITV as it is now known, and not to Liverpool. The diluted company and his own shares would anyhow only give him a shareholding of 11 per cent. That might, arguably, be enough to get him a seat on the board but the prospect of banging his head against a brick wall every board meeting isn't likely to appeal to him.

There's much that concerns Morgan and others about the Thai deal. Not least is the fact that David Moores will be selling a stake of his own shares to the Thais. The plan is that the Thais put £45 million into buying shares off the club while £20 million will go to into Moores' pockets for his shares.

But there are other issues. Putting aside the human rights issue which is of great concern, there is still the question of how the Thai's are going to finance the deal. Is it a private deal financed by Thaksin or is it a private deal financed by a consortium of businessmen ? Is it to be a lottery financed deal or will it be a floatation on the Thai stock exchange ? All these possibilities have been put forward by the Thais in the past week. Day by day their plans have changed so that today nobody is quite sure who is going to pay for the deal. One day they say one thing, the next day they say something totally different.

If it financed by public investment, then that is shameful. Thailand is not a rich country and to expect the public purse to finance such a deal when the money would be better invested in housing, education or health, is a disgrace.

So, what about a lottery ? Does anyone have any idea how long it will take to raise $65 million from a lottery. Just ask our national lottery and they'll tell you: years. And a floatation ? Apparently not legally possible. That leaves us with the Prime Minister digging into his own pocket (a bizarre and dubious prospect if ever there was one) or a consortium of private Thai businessmen throwing their money in. And if it is the latter, who will these businessmen be and how will they divide the shares between them.

But my other worry is this. Just what happens to those shares. Will they be in some individual's name ? And what will happen if that individual dies. Who gets the shares then and what would happen if Thaksin is voted out of office - as he surely will be one day. There are just too many questions associated with the Thai deal, especially when we have a lifelong Liverpool fan who's probably supported Liverpool from the terraces of more grounds in England than most of us have, who is desperate to get involved and help finance the future of the club.

I know some people are dubious about Morgan but he genuinely wants to get Liverpool back to winning major trophies. There's nothing in it for him. He's a proven businessman. He's not arrogant, he's very personable; something which you might not expect from a person of his wealth. But take it from me he's okay. True, if he did get in then some uncomfortable questions might be asked but I think he'd be prepared to give Houllier another season. He is at least ready to compromise which seems to be more than David Moores is.

[Rushian]

He hasn't half written some bollocks there. $65 million would have been raised in two weeks in our National Lottery. It raised £1 billion in the first ten months (after prizes, taxes and Camelot's cream off of 10%).

"The plan is that the Thais put £45 million into buying shares off the club while £20 million will go to into Moores' pockets for his shares"

Nobody knows the plan and that is the problem. Of course the last time anyone put money into buying Moores' shares (Granada) he gave the money to the club.

[Rashid]

Steve I am shitting my pants, I just don't like this Thai deal and don't think Steve Morgan is good for the boardroom in his current ranting state. Surely we can get Morgan and Moores to work together? That would be ideal wouldn't it?

The silence from the club is deafening and to be honest frightening.

[IrishRed]

Rushian - yours are the only posts/articles i'll read on this takeover

cheers

[Gnurglan]

I don't know much about Morgan, but I side with him. I don't side with his financial plan, but I think he's the guy we should go with.

If he gets to sit in the board room and causes a debate or a storm, that's not the greatest thing that could happen. But we'd get a different voice in there, different ideas. That I think would be good. He would not be a majority shareholder, so what do we have to fear?

With the Thai, it's clear he doesn't care if the club is LFC, Arsenal or Fulham. That's a big no no to me. He's in it for the investment. He wants to exploit the "brand" LFC. That "brand" and what it represents, should be decided by fans and the board. Just how much would he use the brand? One thing I reckon is certain, he'd use if far more like he feels than Morgan.



If we want the Thai money, here's my suggestion. Let him buy 15% and let Morgan buy the other 15%. That's it. No side deals, no commercial rights or anything. If the Thai is ready to pump in some extra 30M, apart from the 15%, to improve the club, great. Let's see what he's got. Let's see what he wants. Split the power between him and Morgan. Moores would stand strong, we'd get the money in. Morgan would become stronger and perhaps we'd get fresh money from the Thai.
If the Thai backs out, what's the reason? Does he want a large slice of the club? Does he want some commercial rights? Or does he actually invest for the benefit of the club? Morgan would get his seat in the board room, but his influence wouldn't be that great. If he backs out, what would that tell us about him? What would his reasons be?

[Fanxxxxtastic]

Cheers for the article Rushian. 

It's helped me get a bit of a grip of this whole sorry mess.

[MichaelA]

A very good piece IMO but to be honest I wouldn't want a man on the board that everyone dislikes (according to this article). Wouldn't it be perfect of Moores and Morgan could patch things up?

Morgan: The End of the Line?

by leading Livepool FC author Stephen F. Kelly

SK loves SM, basically. It's not so much an article, as a several hundred word love letter. Poor Steve, lost, unloved and alone in the Director's Box. My bleeding heart. And that's before we get into the wild speculation and inaccuracies throughout the piece. And the platitudes and the assumptions and the forelock tugging deference to Mr Morgan.

we have a lifelong Liverpool fan who's probably supported Liverpool from the terraces of more grounds in England than most of us have

Laughable. Just because he is a local Jersey Red with a big wad does not qualify him to a seat on the board any more than it qualifies me, or Rashid, or Thaksin Shinawatra.

[Bob Kurac]

Top work yet again, Steve.

I understand your frustration - and respresentation - on the issue of the void of communications between club and supporters/media at present. However, I think it's tactically sound. I posted this elsewhere in regards to a smiliar complaint :

Just imagine you're Parry at the moment. You're playing multi-dimensional chess. Amongst the dimensions are :

Investment dimension :
- you've got two sources of considerable investment trying to get a deal, both of which are probably far less strategically gifted than you, but whose clear interest lies in overt media campaigns. To win the game, you want more money for less deal from either or none of these. You will get this from a mixture of showing the true worth AND real potential of the investment, offloading deadwood, securing your strengths, and adding to them, both on and off the pitch. The more credible you are seen to be to deliver the ingredients to challenge at the highest level just because of who you/the club already are/is, the more cash you will get for less deal.

Chairman dimension :
- he's the best around, but might not have any more cash. The more money for less deal you get, the more likely you are to keep him as your boss, but if you can't get it, you've got to deal with the situation.

Manager dimension :
- Houllier has a year left on his contract and all said and done has some strengths and has done some grat things, especially the way he has nurtured Gerrard and Owen. How credible is he to investors, and the current board ? Is there a role ? How loyal are current and new signings who are key ? If you're going to replce him, it has to be a step up in credibility.
- Only you and the chair know who's in the frame, but how about O'Neill, Benitez, O'Leary, Allardyce, Curbishley, Dalglish for starters ...

Players dimension :
- you've got Owen, Gerrard and the Cisse to keep, and potentially plenty more new blood depending on how you're getting on in the other dimensions. You've also got a load to sell.

If I were in that situation, and was a genius of such strategy (which Parry undoubtedly is on a good day), I'd be very quiet to the media except when it was a useful move - and I'd be buzzing me box off playing the game of my life. And when there was a result, I'd talk, win or lose.

I'm not saying I support any of it, but I'm crossing my fingers and trying to have faith that Parry's going to pull off a masterstroke, and that when he does we'll know all about it.

Of course, it could just be anarchy ... 

[Roger]

Good points made in that editorial. Ta for taking time out to write it.

    

[Rushian]

The problem I see with the "keep schtum" argument is it reflects a situation from 10-20 years ago. It's a cliche to refer to the information age but it can't be denied.

Everyone has email. Text messaging. Rolling 24 hour news and sport radio stations and TV channels. The web to access the worldwide press.

Stories and opinion are formed and passed around with indecent haste. Positions are set in stone quickly. I just cannot see how the club can sit there with its hands over its ears, eyes closed, screaming "I can't hear you, I can't hear you".

At the moment we're being neither proactive or reactive.

[Bob Kurac]

At the moment we're being neither proactive or reactive.

I know what yu're saying; but - with my rose-tinted spectacles on when looking at Parry these days (of course I fundamentally loathe him for selling our game to nonces a decade or more ago, but here we are ...) - I'm trying to understand why. I don't think it's arrogance / stupidity / mild inconsiderateness. I think we're being proactively quiet ! We've weakened both Morgan and Shittywater's positions by letting them blurt out bollocks and spin, and then gently, factually, said just enough for the club to be reinforcing its position of strength.

[Hinesy]

the schtum thing is a problem especially because no-one else keeps schtum - the Thai's are spouting off a right load of nonsense. And we know Morgan is playing a canny media game. So Liverpool Football Club by inference have mud thrown at them which will stick and also look silly for not responding and leave us the masses to make stuff up - which is a disaster.
Steve - enjoyed your summation to date. ta

[Rushian]

hinesy summed it up well there - I'm all for omerta if everyone practices it

[Bob Kurac]

the Thai's are spouting off a right load of nonsense.

and it's been revealed as such by discreet statements/leaks from the club

And we know Morgan is playing a canny media game.

It's not that canny. It was initially populist, and for anyone easily swayed by simple tabloidisms it was successful on that level, but he was made to look foolish by playing the "Scousier than thou card" and then being shown to have made an "unattractive" offer, to not value the club very highly !

So Liverpool Football Club by inference have mud thrown at them which will stick and also look silly for not responding and leave us the masses to make stuff up - which is a disaster.

but they have responded, to specific details. And in a way which hasn't pissed off or alienated either potential investor ... they called the bluff of the Thais over the pace at which they were trying to complete the deal, and they've not forced Morgan out. If he wants to, he can now make an offer based on real value, having made himself look a bit stupid for the value of his original offer.

[Armin]

Another good piece Steve. 

Given that RP still has to sell whichever deal to the support once the inks signed there could surely have been some limited press work / tactful briefing of friendly journalists?  I take Steve's view, from a PR perspective this has been badly mismanaged.

One inevitably suspects that is that there is no coherent message from within the club to communicate.  Usually when you have a difficult decision to implement you bring in the consultants and to me the hiring of Hawkspoint smacked of an internal divide within the board.

Of course the fact that Thaksin is a politician means that no steely eyed silence from RP is likely to be replicated on the other side.  The board need to brief trustworthy sources to put their views across.  King Kenny saying 'trust moores' isn't going to cut it (although I do).

[Armin]

And in a way which hasn't pissed off or alienated either potential investor ... they called the bluff of the Thais over the pace at which they were trying to complete the deal, and they've not forced Morgan out. If he wants to, he can now make an offer based on real value, having made himself look a bit stupid for the value of his original offer.

Communicating with Morgan via press release and not having the courtesy to call him might have been somewhat justified due to the way he conducted his bid but it reflected very badly upon the club.  He made them appear aloof and arrogant and it was completely unnescessary.

[Hinesy]

It's not that canny. It was initially populist, and for anyone easily swayed by simple tabloidisms it was successful on that level, but he was made to look foolish by playing the "Scousier than thou card" and then being shown to have made an "unattractive" offer, to not value the club very highly !

Would personally agree Bob but I think there are an awful lot still believing the 'hype' - the applause in the Kop when the banner went across was a demonstration of that.

but they have responded, to specific details. And in a way which hasn't pissed off or alienated either potential investor ... they called the bluff of the Thais over the pace at which they were trying to complete the deal, and they've not forced Morgan out. If he wants to, he can now make an offer based on real value, having made himself look a bit stupid for the value of his original offer.

too true yet the 'kneejerkers' always want an instant response - a soundbite, a headline, to soothe their fury and questions. i know they're running a business and a football club but alas those who read but don't think will believe the rumours that are never dispelled by the Board's silence.

[Bob Kurac]

Given that RP still has to sell whichever deal to the support once the inks signed there could surely have been some limited press work / tactful briefing of friendly journalists?

And there clearly has been.

One inevitably suspects that is that there is no coherent message from within the club to communicate.

Coherent in the sense of Deal A or Deal B, no. Today's briefing seems to have clearly indicated that there will be further discussions with both the Thais and Morgan.

Usually when you have a difficult decision to implement you bring in the consultants and to me the hiring of Hawkspoint smacked of an internal divide within the board.

Agreed

Of course the fact that Thaksin is a politician means that no steely eyed silence from RP is likely to be replicated on the other side.  The board need to brief trustworthy sources to put their views across.  King Kenny saying 'trust moores' isn't going to cut it (although I do).

I don't deny it might be in chaos. But I also think (well, I desperately hope) we could be witnessing the silence fronting some very careful manouevres.

[SCABBERS]

Heads up. people, new boy to this forum thing here, so if I make a bollox of this, apologies now....
surely we're all being a wee bit naive about this whole affair? The Club-and let's leave them as a faceless business entity for now, not individuals-are in this for one thing ony---money. Personally, I don't want the Thai's to invest---and it's not because of a little-Englander mentality, simply a matter of there's too many potential pitfalls in the way. Conversely, I would like to see Morgan's money, for all the obvious reasons(fan, local lad, whatever) but I can also appreciate that others may have reservations about his ulterior motives.  But in the end, it doesn't make any difference what we want, and how we feel about where the money's coming from--if The Club want it, they'll get it anywhere and any how they can, and sentiment don't enter into it!
God, for a first post, that's mighty depressing, to sit here and believe our love for our team has no impression on the Board, but I can't see it spinning out any other way...someone please talk me out of this...... 

[Mikeebee]

According to a Reuters article:

http://www.reuters.co.uk/newsArticle.jhtml?type=footballNewsUK&storyID=5256012&section=news

"A group of leading academics on Wednesday said the bid violated an article of the constitution which forbids the state from competing with the private sector unless in the interests of national security or to set up public utilities."

"To cite sport development is just a pretext to justify what is in fact a distortion in the exercise of state power," they said in a letter quoted on the front page of the Nation newspaper."

Here's a link to the article/letter:

http://www.nationmultimedia.com/page.news.php3?clid=1&theme=A&usrsess=1&id=114351

I don't think "sorry" is a strong enough description for the way this is going, downright clusterF**k is more like it.