Administration not a threat to Reds - Purslow
Published 22/09/2010 | 12:56
Liverpool managing director Christian Purslow has dismissed fears the club will go bust should the current ownership issues not be successfully resolved.
But he has warned Tom Hicks, who is trying to put together a package to restructure his loans and buy out fellow co-owner George Gillett, that the board will not allow him to use Liverpool's assets as security in any refinancing deal.
The two Americans owe £237m plus additional huge penalty fees to the Royal Bank of Scotland and the loan is up for repayment or renegotiation in mid-October.
But as the club has still not been sold either option appears unlikely, which is why Hicks is trying to find funding from elsewhere.
Concern has been expressed that should he fail then there is an outside chance the bank could take over the club and it could ultimately end up in administration.
Purslow said that was not the case.
"Liverpool Football Club is not going bust. We have an extremely healthy business with record revenues and we are highly profitable," he said.
"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 licence 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.
"The issue today is that too much of our 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."
Hicks has already had one refinancing project vetoed by the club's board, when Purslow, chairman Martin Broughton and commercial director Ian Ayre out-voted the two Americans.
When the Texan entered into discussions with investment group Blackstone last week the rest of the board began exploring the possibility of a legal challenge.
Blackstone ruled themselves out of the proposal on Monday and Purslow stressed no new refinancing would be allowed which aimed to utilise assets like Anfield, the club's Melwood training ground or even players.
"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. [It is] very unlikely," he told LFC TV.
"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."