Liverpool owners block sale with US court order

Liverpool’s owners have blocked the sale of the club with a restraining order granted by a US court.

London: Liverpool’s American owners have blocked the sale of the English football giants to the owners of baseball’s Boston Red Sox with a temporary restraining order granted by a US court, their lawyers said.

Tom Hicks and George Gillett revealed the move late Wednesday just hours after the High Court in Britain ruled against the American duo and in favour of Liverpool’s board.

The board has agreed to sell the club to Red Sox owners, New England Sports Ventures (NESV), but Hicks and Gillett contested the proposed deal through the courts in Britain.

Their defeat appeared to pave the way for Liverpool’s board to press ahead with the sale -- but the Texas court’s decision to grant the restraining order dashed hopes of a swift conclusion to the saga.

News of the injunction emerged as Liverpool’s directors were meeting with NESV chief John Henry in London amid expectations a deal was to be announced.

Liverpool’s board blasted the restraining order and insisted they were “resolved to complete the sale.” NESV has tabled a 300-million-pound (475-million-dollar) bid for the club.

“The independent directors consider the restraining order to be unwarranted and damaging and will move as swiftly as possible to seek to have it removed,” said the board in a statement.

The order is part of a lawsuit filed by Hicks and Gillett, in which they allege an “epic swindle” which would have sold the club at a price “hundreds of millions of dollars below true market value,” said a statement from their lawyers Fish and Richardson.

The lawsuit filed by the Liverpool owners is against their major creditor, Royal Bank of Scotland (RBS), three members of Liverpool’s board and NESV, said the statement.

They are also seeking damages of around 1.6 billion dollars, it added.
The restraining order was signed by Judge Jim Jordan of the 160th District Court in Dallas, with a hearing on the matter due on October 25, according to the statement.

In the British court battle, lawyers for the US owners had argued for more time to find a better offer than the bid tabled by NESV, claiming the boardroom manoeuvring which led to the deal was illegal.

But Justice Christopher Floyd on Wednesday granted injunctions brought by RBS, rejecting Hicks and Gillett’s request to halt the sale negotiations.

“I am not prepared to grant any relief,” Floyd said. “If I did it would risk stopping the sale and purchase agreement going ahead.”

Floyd also ruled that attempts by Hicks and Gillett to scupper the deal last week by sacking two board members was the “clearest possible breach” of a refinancing agreement they entered into with RBS in April.

Hicks and Gillett, who took over the club in 2007, claimed that the English members of Liverpool’s board -- chairman Martin Broughton, Christian Purslow and Ian Ayre -- had not acted in the best interests of the club.

Legal analysts predicted the board was likely to approve the NESV sale after the British court ruling, despite a late bid from Singaporean billionaire Peter Lim, who had tabled an offer worth around 360 million pounds in total.

Wednesday’s ruling allowed RBS to recover their 237-million-pound loan which Hicks and Gillett had been required to pay back by October 15.
However the NESV sale would leave Hicks and Gillett an estimated 144 million pounds out of pocket after a turbulent three-year reign at Liverpool, the most successful club in the history of English football.

Liverpool were put up for sale by the unpopular duo in April, who initially sought an asking price of around 800 million pounds, a figure that they subsequently dropped to 600 million.

The American owners have been the subject of fierce protests from fans, who have blamed them for a steady decline in the club’s on-field fortunes and failure to deliver on a promised new stadium.

Around 7,000 supporters demonstrated before the club suffered a shock home defeat to Blackpool earlier this month, a humiliation which sent Liverpool into the relegation zone and confirmed their worst start to a season for 57 years.

Bureau Report