Former Liverpool chairman Sir Martin Broughton reveals Reds board was split over FSG takeover
Former Liverpool chairman Sir Martin Broughton has revealed the club’s board was split over the FSG takeover.
Broughton arrived at Anfield with a mandate to sell the Reds and did so within six months.
The FSG takeover ended the reign of Tom Hicks and George Gillett but Broughton has revealed it could have been much different.
It has now emerged that the FSG forerunner New England Sports Ventures (NESV) got over the line in the sales process by a single vote, reports the Liverpool Echo.
Broughton has revealed how he was brought in as an independent chairman acceptable to both the owners and RBS Bank.
The bank was owed in the region of £300m by Hicks and Gillett and wanted the sale of the club to progress to make sure they got their money back.
Tom Hicks and George Gillett refused to take part in the sale vote – claiming the board was not legally entitled to make the decision – but Sir Martin revealed for the first time that the three remaining members were also spilt.
As well as the NESV bid, a second was on the table which was also acceptable to all three remaining members of the board – Broughton, managing director Christian Purslow and commercial director Ian Ayre.
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While Sir Martin did not name the second bidder, remaining bound by confidentiality, court documents in America as part of an ongoing legal dispute there have revealed it to be Peter Lim, the Singapore businessman who went on to buy Valencia.
Sir Martin said: “I’ve never disclosed the identity of the second bidder, whether it’s general knowledge or not it’s not for me to say.
“But both bidders were entirely credible, both bidders came on to the scene quite late but arrived at very, very similar values which actually comforted me that that was the market value for the club (around £300m).
“It’s not that someone is necessarily getting a steal here – which is what Tom alleged and George – because you have two people. And if it was a steal one of them would have been higher (the offers) because they were both keen on getting it.
“I think I would have been happy with either bidder.”
With time running out on RBS’s six month extension of the Hicks and Gillet loan in early October 2010, Broughton sent out details of the two bidders to the board members on a Saturday with plans to convene a meeting to agree the sale the following Tuesday.
Until this point – incredibly just three days before the sale – Broughton also revealed that Hicks and Gillett had no idea of the identity of the possible buyers because both had requested anonymity during the process.
Indeed another buyer who had been linked with a bid for the Reds made it easier for the club chairman to keep the identity of the real buyer away from the then owners.
Sir Martin said: “We were helped in that we’d had to keep the owners conscious of the fact there were bidders and I’d also informed them that one of the bidders was a US sports franchise owner.
“They’d heard rumours that the New England Patriots’ owner Bob Kraft had been approached but had turned it down. They were convinced it was Kraft and he wasn’t going to bid – they didn’t take it seriously.
“It was a helpful diversion in many ways.”
Sir Martin claims Hicks would have been keen to discourage potential buyers as he still did not want to sell Liverpool.
“It took me probably longer than it should have done to realise that I had to be less open with Tom than I would have liked to have been and that I should be as chairman.
“Because I did feel that he was actively working against a sale.
“The two final bidders who did come both made it a condition of an offer that the owners were not informed. Which was interesting that both separately came to the conclusion they would only put a bid in to me if I didn’t tell the owners about them.”
When Hicks and Gillett learned of the sale plans they tried to change the make-up of the board before the bids could be considered.
They attempted to remove Purslow and Ayre from the board and replace them with Hicks’ youngest son Mack and Lori Kay McCutcheon, an executive in Hicks Holdings.
“It was dropped on me about three minutes before the meeting. We started the meeting and they said the board was invalid because two of the board had been removed by them,” recalled Broughton.
He took a one hour adjournment to check his legal advice – and crucial trump card – that only he had the right to change the formation of the board.
He then reconvened the meeting to consider who would be the new owners of Liverpool FC.
“They (Hicks and Gillett) refused to take part, saying the meeting was ‘ultra vires’ (acting outside its authority).
“We continued with the board meeting and concluded that both bids were acceptable and we would set up a sub-committee to assess the two options.
“We stayed up into the early hours of the morning negotiating between the two and finally confirming that it was going to be Fenway/NESV.
“It was a close decision for all of us – it wasn’t unanimous – it was the position of the board.”
Sir Martin also revealed that one of the bidders had been brought into the process by Ian Ayre.
He did not reveal which one though Ayre’s longstanding business links to the Far East might suggest it was Lim and it may have been Ayre who voted for their bid.
So how did Broughton tell John Henry he was the new owner of LFC?
“They were still there in the office till midnight or whatever it was in a room so I went in and congratulated them. At that stage they looked at each other and said ‘I wonder whether we’ve won or lost with this’?!”
With the bids being very close in financial terms – those US court documents suggest Lim may have offered slightly more – what was it that swung the vote in favour of FSG?
Sir Martin said: “There were two elements which swung it in favour of what is now Fenway for me.
“One, and probably the most important one for me, was that they had demonstrated with the (Boston) Red Sox what they were planning to do with Liverpool…
“They had a track record of taking a great, traditionally successful top club which had not enjoyed success recently, enjoyed success and converted it into a much more modern stadium, but still Fenway. They wanted to do the same with Anfield.
“So why would you leave a place like Anfield -with all that that’s got – to go somewhere that’s ‘does it really fit Liverpool?’ I liked that.
“The other piece that came into it was that by now it was quite clear I was going to be sued. And I felt the Americans were much more aware of that piece of the process and much more likely to stand up through that piece of the process.”
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After approving the sale – and having his right to do so endorsed at a famous day in the High Court – Sir Martin was asked to stay on as chairman of LFC by the new owners.
However he decided it would not be right to do so and stepped aside, with Tom Werner taking on the role of Reds chairman which he currently still holds.
He has occasional contact with the owners and is convinced he found the right owners for Liverpool at the time.
“I’m very happy we found the right people, I think they’re terrific owners, I really do.
“They delivered on Anfield, which I think is fantastic…they brought in a fabulous manager, I think they’ve done everything you could ask of them really.
“I’m very pleased that I did it and I’m pleased with the outcome.”