Gaillard fires debt warning
The Hicks-Gillett era at Liverpool should stand as a warning to the risks of takeovers funded by debt, a senior UEFA figure told an inquiry into football today.
William Gaillard, adviser to UEFA president Michel Platini, told MPs Liverpool had come close to going under after Tom Hicks and George Gillett had loaded debt from their takeover onto the club.
Gaillard, giving evidence to the culture, media and sport committee in London, said: “The leveraged buy-outs for many clubs end in disaster – just take Liverpool where you have owners who came, contracted debt, bought out the previous owners and saddled the club with the debt.
“The club has been rescued, thank God, because of the fantastic heritage of Liverpool Football Club, but it was a close call.
“There was the extraordinary situation where a club was being owned by the British and American governments.
“They suddenly found themselves being owned by two failed banks that had been taken over by Governments – RBS by the British government and Wachovia by the US government.”
Gaillard claimed that the takeover by American tycoon John Henry’s NESV company that rescued Liverpool last year was in part due to the attraction of UEFA’s financial fair play rules, where from 2014 clubs in European competition will only be allowed to spend what they earn.
He added: “John Henry at Liverpool and Thomas di Benedetto at Roma said the main reason they were investing in European football was because of the financial fair play rules.
“They make a much more predictable environment, more similar to what they are used to in American sport, a more regulated environment than the crazy situation that existed before.”
