RBS To Control Quick Liverpool Sale

Royal Bank of Scotland may
take direct control of attempts
to find a buyer for Liverpool. It
comes amid growing unease at
the failure to remove American
Tom Hicks and George Gillett
ahead of next month's
refinancing deadline.
Officially the bank supports the
sales process being handled by
Liverpool chairman Martin
Broughton and investment bank
Barclays Capital, but with just 25
days until the expiry of RBS's
financing deal with the
Americans, the issue is becoming
acute for RBS.
Among the narrowing options
being considered by executives,
including chief executive Stephen
Hester, is for RBS to take greater
control of the process from
BarCap.
This would simplify any deal-
making process and could allow
the bank to try to force Hicks and
Gillett to accept a lower price for
the club than the £500 million-
plus valuation that looks
increasingly unrealistic.
The terms of RBS's £237 million
loan to the American owners
expires on Oct 6, and if no buyer
is realistically close to sealing a
deal then the bank will have to
decide whether to call in the
debt, effectively forcing Hicks and
Gillett out, or offer a further
extension.
Neither option is
straightforward, but The Daily
Telegraph understands that RBS
will extend the financing deal for
a short period only if Broughton
indicates there is a realistic
chance of a deal being closed
quickly after Oct 6.
The bank is extremely reluctant
to step in and take direct control
of the club however, hence the
desire to press hard for a deal in
the 25 days before the financing
deadline.
Any deal remains reliant on a
suitable bidder being interested
in the terms on offer however,
and Broughton and BarCap have
been frustrated in their search
for a credible buyer by the
American's price expectations
and the debt burden.
They began the search in April
after Hicks and Gillett agreed to
sell the club and to the
appointment of Broughton,
chairman of British Airways.
At that time the owners' loans
were shifted from RBS's
corporate lending arm to their
"bad bank", the Global
Restructuring Group established
in the wake of the global
financial crisis to handle its over-
leveraged and problem clients.
BarCap are understood to have
made a slow start in the search
for new owners.
Despite a very public approach,
Chinese businessman Kenneth
Huang pulled out without
making a formal bid amid doubts
over the source of his funding,
and India's Sahara Group said it
was not interested in a deal "at
the moment".
The US investment house the
Rhone Group made a £100
million offer for a 40 per cent
stake earlier this year Unless RBS
can identify a new buyers they
may be forced to return to the
existing field offering the club at
a reduced price.
To do that they will have to call
time on Hicks and Gillett, a step
they have so far declined to take.