Liverpool owners lose court battle
Published 13/10/2010 | 11:44
Britiain's High Court today granted injunctions that could open the way for the prompt sale of Liverpool.
The club's owners Tom Hicks and George Gillett asked a judge to delay the hearing of an application by creditors Royal Bank of Scotland (RBS) for mandatory orders paving the way for a possible sale this week.
But the plea was rejected by Mr Justice Floyd, sitting at the High Court in London.
At RBS's request, the judge imposed injunctions on the two men requiring them to restore the original constitutions of the companies and managing directors.
This removes the final stumbling block to a £300m takeover by New England Sports Ventures (NESV), which will see the RBS recoup its original £237m loan to Mr Hicks and Mr Gillett when they bought the club in March 2007.
Mr Justice Floyd rejected applications by the owners for an injunction to halt the sale negotiations until they had attended a board meeting and there be further discussions over any sale agreement.
"I am not prepared to grant any relief," he said. "If I did it would risk stopping the sale and purchase agreement going ahead."
He said this would result in potential serious damage to the club and RBS.
Yesterday the judge heard Hicks had tried to block the NESV deal last week by removing managing director Christian Purslow and Ian Ayre from the board of the Liverpool Football Club companies.
He had then installed his son, Mack, and business associate Lori McCutcheon so that he had control of voting on the board before a meeting to decide on which bid to accept for the sale of the club.
But this was in breach of agreements the Americans signed with the bank when RBS extended it credit facilities.
The RBS loan facility ends on Friday and the bank had applied to the court for the injunction to allow the sale to go ahead and recoup its money.
The owners were refused permission to appeal.
The judge said it would be "inappropriate in the circumstances" for him to grant leave, and they would have to apply to the appeal court for permission.
Keith Oliver, a senior partner with solicitors Peters & Peters, who are acting for Mr Hicks and Mr Gillett, said an appeal was not being ruled out.
Mr Oliver said: "We are obviously disappointed with the judge's decision.
"Mr Hicks and Mr Gillett will now be considering their next steps, and that will include whether to make an application to the court of appeal."
There were chaotic scenes outside the Royal Courts of Justice in the Strand when more than 100 Liverpool fans mobbed club chairman Martin Broughton, singing: "We love you, Martin, oh yes we do."
Security guards tried and failed to move the crowd blocking the entrance as they broke into the Liverpool anthem You'll Never Walk Alone.
Lord Grabiner QC, who represented the companies controlling the club, put the costs of the action at between £250,000 and £500,000.
Broughton described himself as "elated" with the result but stopped short of saying that the club will definitely be sold to John Henry's New England Sports Ventures.
Broughton said nothing is guaranteed ahead of a meeting that will be held tonight with a reconstituted board.
Singapore business tycoon Peter Lim tabled an improved £320m bid yesterday and Broughton, who was appointed in April to oversee the sale of the Anfield club, will wait to see what the outcome of tonight's meeting is before endorsing either bid.
He told Sky Sports News: "I am absolutely elated, it's a very important day for our club.
"This will clear the way for the sale, we will have a board meeting this evening and proceed with the sale.
"It has been an anxious time but we have been confident. But when you go to court you can ever be sure."
Regarding the sale to NESV, Broughton added: "The board has to be reconstituted and I can't prejudge what the board is going to say. It would be inappropriate to prejudge what the board may say.
"I want to thank the fans for their support through a difficult time. We hope to have the board meeting this evening. We will get the right owners for the fans.
"It was an excellent outcome and I will be very pleased when the process we came in to do is completed."
A statement on the club website said: "We are delighted that the court has clarified the issue of board composition and has removed the uncertainty around the sale process.
"We will now be consulting with our lawyers and planning for a board meeting tonight. A further statement will be made in due course."
John W Henry, who heads the NESV consortium, commented on the High Court verdict.
Writing on his Twitter account, he praised Broughton, managing director Christian Purslow and commercial director Ian Ayre.
Henry wrote: "Well done Martin, Christian & Ian. Well done RBS. Well done supporters!"