Friday, October 15, 2010

Battle For Liverpool To End At Texas

Liverpool's prospective new
owners were tonight scrambling
to push through a deal that
would end the tenure of Tom
Hicks and George Gillett before
this weekend's Merseyside derby
following another dramatic day
of court action on both sides of
the Atlantic.
New England Sports Ventures'
lawyers, increasingly confident
that a deal could be completed by
tomorrow night, were pursuing
a twin-track approach as they
raced against the clock to get the
£300m deal sealed. The Boston
Red Sox owners today moved a
decisive step closer to taking
control when a high court judge
condemned Hicks and Gillett for
obtaining a restraining order in a
Dallas court, ordering them to
withdraw the US petition
blocking the sale by tomorrow
NESV believed that, if it could get
time before the Dallas judge who
dramatically issued the
restraining order last night and
present him with the judgment
of the UK court, he could throw it
out and allow the sale to
complete tomorrow. If that
happens, the principal owner
John W Henry, who tonight
returned to the central London
offices of Liverpool's lawyers
Slaughter & May, would take over
in time to attend Sunday's match
at Goodison as the club's new
But, if forced to rely on Hicks and
Gillett going to court by 4pm
tomorrow to withdraw the
petition, the deadline set by Mr
Justice Floyd, the paperwork
would not be complete in time
for the weekend. If Hicks and
Gillett do not comply with the
order, they will be in contempt of
court, a serious offence that can
carry a prison sentence.
It emerged today that the
Liverpool board had all but
agreed the sale of the club to
NESV at a tempestuous meeting
last night, at which Hicks and
Gillett revealed they had served
an injunction blocking the deal
that accused RBS and the
Liverpool directors of a "grand
Even as they failed to defend
their position in the high court
this, lawyers representing the
pair were filing a motion in Dallas
accusing the Liverpool directors
and other advisers of contempt
of court in the US for holding last
night's board meeting, which
they claimed was a contravention
of the restraining order. The
Texas court last night adjourned
its proceedings until 1pm BST
Tomorrow's date is significant
because 15 October is when the
£237m owed to RBS and Wells
Fargo is due to be called in,
although in practice the bank has
been able to do so for some time
and would be likely to extend the
loans until Monday.
It is believed the paperwork and
funds are in place for the sale to
proceed and NESV's brief, David
Chivers, referred to them
throughout today's hearing as
"the new owners". "The [former]
owners, from beyond the grave,
are seeking to exercise with their
dead hand a continuing grip on
this company. That is simply not
acceptable," he said.
NESV's hand was strengthened
when the Singaporean billionaire
Peter Lim withdrew from the
process. "It has become clear to
me that the board is intent on
selling the club to New England
Sports Ventures to the exclusion
of all other parties, regardless of
the merits of their bids," Lim said.
It emerged in the high court that
both Lim's bid and one from Mill
Financial had been discussed
yesterday but the reconstituted
board voted 3-2 to accept the
NESV offer, with Hicks and Gillett
voting against.
Hicks was today forced to deny
that he had sold his shares to Mill
Financial, following rumours that
the hedge fund that already
holds Gillett's stake after he
defaulted on a loan had acquired
The dramatic attempt by Hicks
and Gillett to postpone the sale
and claim $1.6bn in damages
looked to have collapsed when
Floyd today accused them of
withholding the full extent of
their similar claim to the high
court, which was rejected, and
said their actions were "on the
face of it, unconscionable".
"I take RBS's point that this case
has no real connection with
Texas. They are right that the
commencement of proceedings
in the Texan court is an attempt
by the owners to depose them of
their gains so far in English
Solicitors for Hicks and Gillett
failed to turn up at the high
court, where the pair were
accused of the "most outrageous
abuse of process" and making
"scurrilous allegations" by
Richard Snowden QC, acting for
RBS. Their allegations that they
were the victims of an "epic
swindle" and "grand conspiracy"
to sell the club below its market
price were "wild and scurrilous"
with no evidence to support
them, Snowden said.
Suggestions that RBS was using
its reputation to prevent any
transaction that would permit
Hicks and Gillett to recover any of
their initial investment in the club
was "absolute poppycock".
Lord Grabiner QC, representing
Kop Football and Kop Holdings,
said there was no way the firms
could be included as plaintiffs
because the board, led by the
independent chairman, Martin
Broughton, had not approved it.
"We say the proceedings brought
in Dallas are abusive, vexatious
and oppressive." He claimed that
their version of the proceedings
in London, restricted to one
paragraph in a 28-page petition,
was a "grotesque parody" that
failed to mention they had
already lost a bid to secure an
injunction in the UK.
"They concealed the fact because
they are now anxious to secure
for themselves a second bite of
the cherry from that famous
jurisdiction,the Dallas county
court. If it were not such a
serious matter, it would be a
joke," he said.
Broughton, the chief executive
Christian Purslow and the
commercial director Ian Ayre –
the three independent directors
on the board that voted for the
NESV deal – said tonight they
were "delighted" with the
verdict. "We are glad to have
taken another important step
towards completing the sale
process," they added.

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