Hicks & Gillett Obtain Injunction To Block Liverpool Sale
Written by Football Talk.
Just as the Anfield ownership struggle looked like it was drawing to a close, the American due Hicks & Gillett have managed to throw an 11th hour spanner in the works, after obtaining a temporary restraining order to stop the proposed £300m sale of the club and are even seeking damages to the tune of $1.6billion.
The restraining order is part of a law suit filed against RBS, Martin Broughton, Christian Purslow, Ian Ayre, NEVS and Philip Nash, and includes ‘temporary and permanent injunctions’ and damages totalling $1.6 billion (over£1.6 billion). Hicks and Gillett have accused RBS, Broughton, his fellow directors and NEVS of an ‘epic swindle’ after apparently cutting them out of all negotiations to sell the club and agreeing to sell Liverpool for ‘hundreds of millions of dollars below its true market value’.
It is not yet clear as to whether the Texas court order has jurisdiction here in the UK, but the early indications are that RBS, Broughton and NEVS could be held in contempt of a US court.
A statement from the current owners was released at around 10pm last night saying:
“The owners of Liverpool Football Club today reported that a Texas State District Court has granted a temporary restraining order (TRO) enjoining the Board of Liverpool Football Club (LFC) from executing a sale of the Club to New England Sports Ventures (NESV). The court set a hearing date of October 25, 2010.
“The TRO request, signed by Judge Jim Jordan of the 160th District Court in Dallas, was part of a lawsuit filed today by the owners of LFC against Royal Bank of Scotland (RBS), Martin Broughton, Christian Purslow, Ian Ayre, NESV and Philip Nash. The lawsuit also seeks temporary and permanent injunctions, and damages totaling approximately $1.6 billion (over £1 billion).
“The suit lays out the defendants’ “epic swindle” in which they conspired to devise and execute a scheme to sell LFC to NESV at a price they know to be hundreds of millions of dollars below true market value (and well below Forbes magazine’s recent independent $822 million valuation of the club) – and below multiple expressions of interest and offers to buy either the club in its entirety or make minority investments (including Meriton and Mill Financial).
“It describes how the defendants excluded the owners from meetings, discussions and communications regarding the potential sale to NESV and interfered with efforts by the owners to obtain financing for Liverpool FC.
“The Club’s owners are represented by attorneys from the international law firm of Fish & Richardson.
“The following are some of the key points in the complaint, which details the roles of RBS and the other defendants, and also describes previously undisclosed offers to purchase LFC:
“The Director Defendants were acting merely as pawns of RBS, wholly abdicating the fiduciary responsibilities that they owed in the sale.”
“RBS has been complicit in this scheme with the Director Defendants. For example, in letters from RBS to potential investors obtained just within the past few days, RBS has informed investors that it will approve of a deal only if there is “no economic return to equity” for Messrs. Hicks and Gillett.
In furtherance of this grand conspiracy, on information and belief, RBS has improperly used its influence as the club’s creditor and as a worldwide banking leader to prevent any transaction that would permit Messrs.
“Hicks and Gillett to recover any of their initial investment in the club, much less share in the substantial appreciation in the value of Liverpool FC that their investments have created.”
“On or about October 4, 2010, Mr. Hicks received a letter of interest from a third potential purchaser represented by FBR Capital Markets (“FBR”), offering to purchase Liverpool FC for £375 to £400 million ($595 to $635 million).
“The letter informed Mr. Hicks that the potential purchaser would not need financing, possessed the funds to close the transaction, and intended to build a new stadium for Liverpool FC.”
“Additionally, the Plaintiffs learned just days ago about another potential investor that made a similar offer in the £350 to £400 million range that was communicated to Defendant Broughton and another unnamed co-conspirator in late August.
“According to this investor, Mr. Broughton never responded to the offer. Moreover, when the purported sale to NESV was announced, this investor again contacted Mr. Broughton and informed him that the offer, which significantly exceeded the NESV offer, was still on the table. Again, Mr. Broughton brushed this offer aside without further discussion.”
It seems the ownership battle at Anfield may have taken another turn.
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