LONDON (AP) - A British judge will rule Wednesday on a key issue in the battle for ownership of Liverpool.
A hearing was held in the High Court on Tuesday on whether Liverpool co-owners Tom Hicks and George Gillett Jr. have the power to fire directors who back the sale of the financially troubled club to the parent company of the Boston Red Sox.
Royal Bank of Scotland, which holds the bulk of Liverpool’s debt, is seeking confirmation that Hicks and Gillett breached a refinancing deal by trying to replace two boards members who sanctioned a 300 million pound ($476 million) sale to New England Sports Ventures.
In court, RBS lawyer Richard Snowden accused Hicks and Gillett of a “calculated breach of contract … to frustrate the sale process.”
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.
LONDON (AP) _ Liverpool’s proposed takeover by the owners of the Boston Red Sox is uncertain after a Singapore businessman raised his offer for the Premier League club on Tuesday and lawyers representing the current owners said a third group is also making a bid.
The future of the club was being discussed in a hearing at the High Court in London.
Royal Bank of Scotland, which holds the bulk of Liverpool’s debt, is seeking a court order preventing co-owners Tom Hicks and George Gillett Jr. from removing two of the three rival board members supporting a $476 million sale to New England Sports Ventures, owners of the Red Sox.
Richard Snowden, a lawyer representing RBS, accused Hicks and Gillett of a “calculated breach of contract … to frustrate the sale process” by trying to fire managing director Christian Purslow and commercial director Ian Ayre.
“It is breathtaking arrogance on the part of Mr. Hicks and Mr. Gillett,” Snowden told a packed court room, claiming later that “Hicks and Gillett are seeking to profit from the confusion that their actions have brought.”
Paul Girolami, representing Hicks and Gillett, didn’t dispute the breach of contract claim, but questioned the legitimacy of the sale process.
“What has happened is that the English directors have gone forward with the NESV bid without properly considering alternatives when those alternatives at least appear to give better prospects,” he said.
While the hearing was under way, Singapore billionaire Peter Lim issued a statement saying he was raising his offer to $507 million, with an additional $63 million to buy new players.
The 57-year-old Lim said he would not need any financing to fund his offer and that all the money would come from his cash reserves. Liverpool, which won the last of its 18 English league titles in 1990, is off to its worst start to a season since 1953 and is mired in the relegation zone.
“I will be injecting ($63 million) in cash into the club for (manager) Roy Hodgson to bring in new players during the upcoming transfer window,” Lim said. “Liverpool needs to start winning again.”
In court, meanwhile, there was another surprise when attorneys for Hicks and Gillett said there was a bid from American hedge fund Mill Financial to pay off all the club’s debt and commit $158 million to a new stadium.
Mill Financial helped support a previous refinancing of the loan used by Gillett to buy the club in 2007. The hedge fund technically controls Gillett’s 50 percent stake.
RBS has already been granted an interim injunction preventing chairman Martin Broughton or managing director Christian Purslow and commercial director Ian Ayre from being fired.
Broughton and Purslow were in the courtroom Tuesday, while Hicks and Gillett were not.
Hicks and Gillett claim the proposed sale to New England Sports Ventures, headed by financier John Henry, undervalues the club. But the group has already signed a binding takeover agreement with the three board members.
“Everyone is hoping for the best,” Henry said in a message to Liverpool fans on his Twitter account. “There have been enough twists and turns. Hopefully all gets sorted out soon; LFC moves forward.”
RBS wants the sale to the Red Sox ownership group to proceed and has already held off from putting Liverpool into financial administration, a form of bankruptcy protection which would also dock the club nine points by the Premier League.
Friday was the original deadline for Hicks and Gillett to repay $453 million of debt.
The bank says Hicks and Gillett forfeited control of the club to a new chairman, Broughton, as the condition of extending the repayment deadline for their liabilities in April.
Separate legal action may be required by Broughton to assert his legal power to sell the club.
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