Gillett agrees sale of Canadiens to ease Liverpool's financial worries
George Gillett Jr, the Liverpool co-owner, has moved to ease the club’s financial troubles by agreeing to sell his majority stake in the Montreal Canadiens ice hockey franchise.
However, Rafael Benítez, the manager, will still face a fight to keep his best players at Anfield this summer. Molson, the brewing company, has agreed to buy Gillett’s 80.1 per cent stake in the Canadiens for about £330 million, with the deal expected to be concluded before July 24, the deadline by which Gillett and Tom Hicks, his business partner at Liverpool, must have renegotiated their £350 million credit deals with Royal Bank of Scotland (RBS) and Wachovia.
Gillett put the Canadiens up for sale this year and has been searching for a buyer to raise the funds needed to consolidate his position at Anfield, with RBS and Wachovia expected to demand more than the £185 million in personal guarantees that the Americans have made to satisfy their concerns.
The move by Gillett comes after KPMG, Liverpool’s auditor, cast “significant doubt” on their ability to continue as a “going concern”, with the accounts released this month revealing that Kop Football (Holdings) Ltd had made a pre-tax loss of £42.6 million and that the club paid £36.5 million in interest on their debts in the financial year to July 31, 2008.
Molson, which owns the remaining 19.9 per cent share in the Canadiens, sold Gillett the controlling stake in the franchise eight years ago for about £165 million, but was prepared to buy it back for double that amount.
The sale, under which the Molson family will acquire the Bell Centre, where the Canadiens play, and the Gillett Entertainment Group, as well as the team, must first be approved by the National Hockey League (NHL) board of governors. However, no glitches are expected, given the buyer’s long association with the NHL.
Liverpool could receive another shot in the arm if Hicks manages to offload about half of his 95 per cent stake in the Texas Rangers baseball team to a consortium headed by Nolan Ryan, the president and a former player, or David McDavid, a Texas businessman. The Rangers are valued at $405 million (about £245 million).
Even if that happens, though, Benítez may struggle to keep some of his best players. Javier Mascherano could leave, with Barcelona and Real Madrid prepared to pay more than £30 million to sign him. The Argentina midfield player wants to move to appease his pregnant wife, who is unsettled on Merseyside.
Benítez will hope to conclude an £18.5 million deal for Glen Johnson, the Portsmouth right back, early this week, but a summer that Steven Gerrard, the captain, described as “crucial” to Liverpool’s hopes of winning the Barclays Premier League title next season is already turning into something of a nightmare.
