Re: Merged Topics: Club Refinance Thread
Q and A with Purslow from the Official;
1. Who offered you your position at Liverpool Football Club - was it RBS, Tom Hicks and George Gillett or Tom Hicks and George Gillett under pressure from the club's bankers?
"The club offered me the job. I'm an employee of the club and the club is owned and was owned by George Gillett and Tom Hicks. Ultimately they recruited me. I think it's fair to say I came into a situation where the owners were already in dialogue with their banks about the situation. I was very well known to the banks and I am sure when they were asked their view they were supportive of that move."
2. We know you're a Liverpool supporter but why do you think they appointed you?
"That's a more interesting question. I think it's a combination of factors, but most importantly my financial experience and expertise. The club was and is in a situation where a certain set of skills was very important and my career in the financial world and running companies which had leverage and debt in their structure was probably the most important factor to the owners and all the other people involved.
"I like to think the fact I was intimately familiar with the club and had a sense what the club was also helped. I'm a third-generation fan, I've been a season ticket holder for many years and even a small shareholder for some years, so I had a reasonable understanding of the business side of Liverpool. It was probably a combination of my professional experience and my affinity with the club. In business, never underestimate the importance of willingness and availability. I love this club and when offered the opportunity to come in and see if I could help them out of that situation, I was more than willing to do that whatever my other business responsibilities and so, speaking for myself, that's why I'm here.
3. How would you describe the club you came into just over a year ago?
"In terms of my job and my role I think it'd be fair to say there have been some quite turbulent times. Relations were difficult behind the scenes with the owners, the chief executive and also the manager himself. I was very grateful for the opportunity before I actually took the job to meet all those people - Rafa, most importantly, the executive team who were running the club at that time and both owners - to be really satisfied from my side and their side that I could come in and work positively with all of those people and create some stability. I certainly saw that as the number one priority. The other fact was I was coming into a situation where loans were becoming due and the bank were being very supportive of the owners' desire to try and have some more breathing space.
"I think all of them thought that stability in management was a pre-requisite to that and so I very much saw that as my main role. I took my time before deciding to do it, I met everyone and so in some senses by the time I came in I was pretty confident I could work with all those parties and get people moving forward together with a sense of unity."
4. What happened to the significant investment that you said was likely to be in place 'by Easter'?
"By Easter there was at least one investor ready to invest in the club, but not on terms that were acceptable at that time to the owners. I think it's fair to say that precipitated a further series of changes; the appointment of Martin Broughton as the new Chairman, pretty dramatic changes to the Board of directors where George and Tom's family came off the Board and essentially the Board was re-jigged and, most importantly, the owners agreed they would seek a sale of all of the club rather than what we had been working on up to Easter, which was a partial investment, which I don't think was ever likely to be the optimum outcome for anybody. So I think that was a positive development in April and since then we have been working hard to try and find somebody to buy all of the club."
5. Are you personally or MidOcean, the Private Equity company you founded that specialises in buying companies that have been the subject of failed leveraged buy-outs, involved in any way in any consortium seeking to buy the club?
"No, I'm not. I have never discussed it with anybody and never had any intention of buying Liverpool. It's very difficult to do that when you are running a business. I can assure you that my former company MidOcean - even if I wanted to - would have no interest in buying a football club. That's not the business they are in or ever were in. I would never do so anyway."
6. We keep hearing about how well Liverpool are doing commercially but it's not much good if all the money we earn goes to paying off debt, is it?
"It is true we are doing well commercially. Our business is continuing to grow and our revenues to July 2010 were a record for the club, despite it being a very disappointing year in football terms, which has its own effect on our financial performance. Despite a disappointing year on the field, off the field commercial activity was sufficiently strong that our revenues and profits were very healthy. We're very proud of that and it's very important when attracting investment and new ownership.
"Equally it is true that far too much of that benefit currently services loans, interest costs and bank charges. Can we afford to meet them? Just about. Do I wish that every penny spent on interest was available to spend on players? Passionately, and every minute of my working day I look for the day we are able to reduce our debt, freeing up our profits to be able to invest on players."
7. Can you update us on what's happening with the sale of the club?
"The process remains underway and there are a small number of potentially interested parties working seriously and privately - doing what is called due diligence - looking at the business in detail from a financial and legal standpoint. My hope is that one of those parties steps forward with a proposal to buy the club which is attractive to the Board and which would be good for the club. I must say that the single most important aspect of the possible sale of the club - and I consider it the most important thing I will ever do in my business career - is to make sure that if we're going to sell the club we get the sale right. The only thing worse than no sale is the wrong sale.
"If I bring anything it is the ability to understand in great detail the questions that need to be asked of potential buyers, to find out what they're really about and where the money really is coming from, what their intentions for the business are strategically, operationally and, yes, financially, and so I urge all our fans and all our stakeholders to take one message from me and that is I will not make the mistake of sanctioning any transaction that puts the club in a worse position. I know the questions to ask.
"Do I know whether any of those parties are going to get over the finishing line? No. Can I make someone write a cheque? No. My job is to present the club to possible investors in the best possible light because I passionately believe it's a fantastic opportunity for investment and new ownership. It's as good as you can find in the world of sport anywhere and my job is to present that in the best possible light, but I can't make people write a cheque, nobody can. All I can do is make sure when they are willing to do so that I can say hand on heart that these are the right new owners for the club. I assure you I consider that to be an awesome burden of responsibility but I am very well qualified to do that properly."
8. The club have remained largely silent throughout the process - has that been a deliberate ploy?
"From my experience of 25 years of buying and selling businesses and working in the financial world, a good rule of thumb is that if you're reading about it then it probably isn't real. Most corporate purchases are done in conditions of professionalism and confidentiality and we certainly respect that.
"It hasn't been the case that all the people interested in buying Liverpool have kept quiet about it. I ideally wish everyone we had read about was here now and real and ready to write a cheque to buy Liverpool, but that also hasn't proven to be the case. Martin Broughton said when he arrived that he wouldn't give a running commentary on the sale process because that would damage the process. No real and credible bidder wants to be reading about themselves before they buy. Please don't confuse silence with lack of progress and intense activity in trying to achieve the end that we passionately believe is right for Liverpool."
9. We were told by Martin Broughton and the owners themselves in May that Tom Hicks and George Gillett were committed to the 100 per cent sale of the club. Can you explain why we are now reading in the newspapers that Tom Hicks is looking to refinance the debt rather than sell the club?
"I can't speak for the owners but I am absolutely sure that both of them are totally committed to trying to sell the club as soon as possible. They haven't had an offer yet that they like and so I suspect that both of them individually and collectively are pursuing their other alternatives and that's their prerogative."
10. Can the owners refinance the debt against the club's assets - whether that's our players, stadium or training ground?
"That would require Board approval and the other members of the Board have made it clear that's not what we want to see happen."
So that's unlikely?
"Very unlikely."
11. Can you, Ian Ayre or Martin Broughton oppose the refinancing of the debt by the current owners?
"Again, any incurrence of indebtedness by Liverpool Football Club needs full Board approval. The non-owner directors have made it clear that's not what we want to see happen."
12. Are you, Ian Ayre and Martin Broughton all still committed to the sale of the club?
"Absolutely."
13. Do you expect to remain at the club in any capacity once the sale of the club eventually goes through and if you don't, why would you even want us to be sold if it means you risk losing your job?
"I want this club sold more than anybody in the world. It's not about me. I don't have a contract. It would cost the new owner nothing to say the day after he buys the club, 'Thanks very much but we don't need you.' My job is to make sure we find that owner, to present the club in the best possible light and leave it to a new owner to decide who he wants to run the club, but without the obstacle of cost and expense of a Managing Director sitting on a large contract. I don't have one."
14. Why did the Board sack Rafa?
"The Board didn't sack Rafa. Rafa's exit was about as clear cut a case of mutual consent as I have ever been involved in in my life. Both sides thought it was time for a change, both sides said so at the time, if you go back and check, and I wish him all the very best in his future career. He is a key part of our history and we wish him all the best."
15. Was a mural depicting our amazing Champions League final triumph ripped down from a wall at Melwood to remove any trace of Rafa from the club's history?
"Absolutely not. I can't say I'm an expert on how we decorate any walls anywhere in our buildings as I do have plenty of other things on my plate, but I have checked. The reality is there was a mural and it was changed to reflect our new shirt sponsor and I'm delighted to say Rafa is smack bang in the middle of it with the Champions League trophy as he should be, celebrating a fantastic night in the club's history. We celebrate our past; we don't hide it or are not embarrassed about it."
16. Did the Board attempt to asset strip Liverpool Football Club this summer to pay off the club's debts as there were repeated claims in the media that Liverpool were trying to 'diplomatically' move on Steven Gerrard and Fernando Torres?
"This is the question I am most asked and the question I am most happy to answer. I say again, every single penny we generate from selling footballers goes back into buying footballers. I wouldn't have it any other way and I wouldn't have taken the job to oversee selling footballers to pay banks or owners money. We never have in my time here and we never will as long as I am here. Please, I ask our fans to have no doubt whatsoever."
So selling Steven or Fernando was never an option?
"It's certainly not something we would have ever wanted to do. You used the phrase 'moving players diplomatically on' which sounds as if we wanted to get rid of Fernando and Steven. Anybody who knows me, who knows Roy or who knows the club will know that nothing could be further from the truth. Any conversations that were had were stressing the absolute vital importance of those players - and others - to our future and to our plans and why they remain so central to what we're doing.
"Let's be honest, if you'd believed half of what you read in May about who would be leaving and who wouldn't... then most of that didn't come to fruition. I'm absolutely thrilled and delighted that it didn't and that those fantastic players still grace our team today."
17. Were players sold against their wishes this summer to reduce our wage bill and reduce the debt against the club?
"I have already answered the first part of that question which is that no player sales would be used to reduce debt. Every penny from the sale of players goes back into buying players. As for wages, our wage bill has actually gone up this year versus last year."
18. Why, when we so desperately need a striker as back-up to Fernando Torres, did we not use the money available in the transfer kitty budget to buy one? What use will unspent money in the transfer pot be to us if Torres gets injured?
"Firstly, it's not that we didn't try. We had an extraordinarily active summer both on player ins and player outs. Our job, my job, the club's job, is to support the manager in retaining the players he wants to retain, buying the players he wants to buy and seeking to sell those players he wants to sell. We achieved 95 per cent of those objectives which, given that it was a very short period of time from when Roy arrived to when the window closed and there was a huge amount of activity, we were very pleased with all that happened in that period.
"Yes, a striker was high on Roy's list of options and, yes, we looked at a number of them, but none of those he really wanted could be acquired. It was Roy's decision, not the club's, to wait, keep our powder dry, look at the market and research players more and be ready to strike in the next window or the window after that. That's his decision and he has been very clear on his views on the record."
Is it a situation that could be revisited in January?
"It's his decision. If Ryan Babel and David Ngog, who he mentioned now have a long period of time to show him what they can do, impress and convince him they are better than what's available in the market, then maybe not. On the contrary, if he continues to see a new striker as a priority then that's what he'll work on doing in January with the total support of the club and with every penny we have available."
19. We used to exist to win trophies. What, in your opinion, is the point of Liverpool Football Club these days?
"Nothing has changed on that score. We have been here for a very long time and the club will be here for a very long time in the future. Our raison d'etre hasn't changed. We exist as a football club to win trophies. At any given time nobody can guarantee that we will but it's not for the lack of trying and whilst I think the environment has changed somewhat and obviously we have some significant challenges ahead of us, that's what we exist to do. The whole club exists to support our manager and our players, whether it's the business side performing well and ploughing those benefits into football or the football side signing players who want to play for Liverpool and want to win trophies for Liverpool. That's what we're about and that's never going to change."
20. Is administration a real danger to Liverpool Football Club if we do not get sold soon?
"Liverpool Football Club is a very healthy business. We have cash, we are solvent, we have banking facilities which last beyond the end of next season and we are heavily scrutinised by the Premier League. To achieve our UEFA license we went through that process and they were very happy with what they saw - so I cannot conceive of a situation where Liverpool Football Club could go into administration."
21. What would you say to supporters worried the club will go bust in October?
"Liverpool Football Club is not going bust. We have an extremely healthy business with record revenues and we are highly profitable. The issue today is that too much of that profit is being used to service loans put into place when the club was bought. We are dealing with that issue. When we sell the business that debt will be reduced or go away which will make us the most profitable club in the Premier League. Liverpool is not going bust."
