Setanta goes bust, Liverpool to follow?

! This post hasn't been updated in over a year. A lot can change in a year including my opinion and the amount of naughty words I use. There's a good chance that there's something in what's written below that someone will find objectionable. That's fine, if I tried to please everybody all of the time then I'd be a Lib Dem (remember them?) and I'm certainly not one of those. The point is, I'm not the kind of person to try and alter history in case I said something in the past that someone can use against me in the future but just remember that the person I was then isn't the person I am now nor the person I'll be in a year's time.

Setanta went into administration today owing £3m to the Scottish Premier League and £30m to the English Premier League.

The Scottish Premier League is looking for a new buyer for £125m of broadcasting rights for the next 4 years and the English Premier League is looking to offload the rest of the matches Setanta had already won the rights to after ESPN took the 45 games that would have been on Setanta next season.

Good.  Serves the greedy bastards right.  £125m for 4 years of what is, to be perfectly honest, amateur football?  They’re taking the piss.  And the English Premier League are really taking the piss.  They may be some of the world’s best football teams but they’re partly responsible for Setanta running out of cash through their greed.

Liverpool are desperately trying to refinance their £350m of debt to avoid bankruptcy with an announcement that RBS have virtually guaranteed to refinance their share of Liverpool’s debt coming on the same day that they announced a £17.5m transfer for Portsmouth’s Glen Johnson.  How can they even contemplate spending £17.5m for a player when they could be days away from going into administration?  The future of their LiverpoolTV channel – a lucrative source of income – is also in doubt as it was being shown exclusively on Setanta and they haven’t got anyone else to broadcast it.

The English Premier League and Premiership clubs have been pissing money up the wall thinking the amount of money involved is just too big for their pyramid scheme to collapse.  Guess what.  It’s not.

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  1. axel (1214 comments) says:

    It is really going to screw over our football league, jeez, imagine trying to sell a pile of shite like Hamilton Academicals in a recession?

    I do think it is a good thing, it will mean expensive foreign players can no longer suck the wages and we will have to rely on home grown talent again, which is a good thing

  2. Mac (2 comments) says:

    Liverpool is arguably the biggest global brand name in World football, theres more chance of Labour winning the next election than Liverpool going bust.

  3. axel (1214 comments) says:

    the liverpool brand is priceless but it will probably have to be sold by whatever company that owns it to pay off the company debts

  4. Mac (2 comments) says:

    I think its only a matter of time before the Americans sell up, but England’s greatest club and the best team in the land will be safe regardless of media scare stories.
    Liverpool ‘financially healthy’
    Friday, June 26, 2009

    Financial deals: Liverpool co-owners Hicks and Gillett

    Liverpool’s bankers Royal Bank of Scotland have dismissed fears about the future of the club by stressing they are ‘financially healthy and able to service comfortably its debt’.

    American owners Tom Hicks and George Gillett are currently in negotiations to refinance the £350million loan they took out to buy the Reds two years ago, with less than a month to go until the deadline for an agreement.

    A deal is believed to be close and despite speculation about potential financial meltdown at Anfield, RBS, who have taken the unprecedented step of writing to fans to explain the situation, are happy to give their full support to the Merseysiders.

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    The bank has stressed they have a ‘long-term relationship with the club, and we look forward to this continuing for many years to come’.

    ‘In our view and that of the executive management of the club, it is financially healthy and able to service comfortably its debt obligations from cash flow generated by its playing and commercial activities.

    ‘It is in our commercial interest to support the club . . . so that it can continue to perform successfully on and off the pitch.’

    Hicks and Gillett currently pay around £35million a year in interest on their loan and recently auditors KPMG went public with their concern over the level of debt being incurred by Kop Football Holdings, Liverpool’s parent company, after it posted losses of £42.6million in the year ending July 2008.

    That was in contrast to the football club business itself, which made a profit of £10.2m.

    The bank have dismissed concerns about the potential fragility of Liverpool’s finances, stressing there is a clear dividing line between what the club owes them and what debt Hicks and Gillett have taken on.

    ‘RBS is the main banker to the club including all of its operating accounts, cash management, online banking, automated payments, and credit card processing to facilitate ticket sales and retail merchandising,’ stated the email.

    ‘We also lent money to the club’s parent, Kop Football Limited, so that it could repay debt which was on the balance sheet of the club at the time of its acquisition by George Gillett and Tom Hicks.

    ‘This is the only portion of Kop Football’s bank debt for which the club is legally responsible.

    ‘We took great care when making our original loan in early 2007 and when refinancing it last January to distinguish between obligations of the club, primarily those outlined above, and obligations of its parent company, the latter being secured by personal guarantees and collateral from the owners and a pledge of the shares they own in the club.’

    Gillett has already struck a deal to sell ice hockey team the Montreal Canadiens for around £330m.

    It is expected he will use some of the proceeds from that as a personal guarantee, which will help in the refinancing negotiations as RBS and Wachovia, the other bank involved, are likely to ask for more stringent conditions.

    Hicks is also trying to realise more capital by offloading about half of his 95 per cent stake in the Texas Rangers baseball team, which could raise around £125m.

    Yesterday American billionaire Robert Kraft, owner of American Football franchise New England Patriots and MLS side New England Revolution, admitted he was very close to buying Liverpool before Hicks and Gillett became involved.

    ‘I met with [the then chairman] David Moores, who is a fine gentleman, and we came very close to buying it, very close,’ he said.

    ‘But in the end my instinct was – without a salary cap, or a stadium… I wasn’t sure how we’d get a stadium built quickly and efficiently. If the salary cap was there, we would have done it.’

  5. axel (1214 comments) says:

    Everytime Axel says, ‘I dont beleive!’, a fairy dies and he is quite pleased to announce that, finally after many years, he got Michael Jackson. 😀

  6. ally (1 comments) says:

    “Liverpool is arguably the biggest global brand name in World football”

    Clearly the “famous” Scouse sense of humour at work. Arguably, indeed. Other than Manchester United. Oh, and Real Madrid. And Barcelona. And AC Milan. Other than that, they’re definitely the biggest. Definitely bigger than Everton anyway.

    Most self-important and self-pitying, I’ll grant you that.

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