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Old 10th May 2010, 15:23   #1 (permalink)
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What next for Liverpool?

Hopefully we all enjoyed the last few weeks of Liverpool's season. 7th is simply a disgraceful return for such a great club given all the resources they have enjoyed the past few years. Frankly, its a complete disgrace.

If the Scouse fans were not so full of themselves, perhaps even we United fans would think it tragic that a genuinely great club seems to be falling apart at the seams. And it really is falling apart for them. The article below is a very good summation of the problems and challenges that they face ahead.

Instead of the normal piss take and the banter that exists between RedCafe & RAWK I thought it was worth starting a serious thread on what RedCafe thinks are the reasons for Liverpool's failings:
  • How did it get so bad?
  • What do we think lies ahead for them?
  • How can they solve their problems?
  • Just where to they start?

I was with some strategy consultant friends over the weekend and we spent a few hours trying to dissect the 'Liverpool problem' and see just how one might resurrect the club if we approached it like another business and the scary thing was, none of us knew where to start. They just have so many interlinked problems .... they have fallen into a rotten business model of diminishing returns and the wheels have just fallen off!

So what lies next for Liverpool?


Quote:
In six months, the Benitez era will seem like a golden age


In the dressing room and on the balance sheet, Liverpool have fallen over the edge, writes Dion Fanning
In six months, the Benitez era will seem like a golden age - Sport, Frontpage - Independent.ie


If Liverpool thought this season was bad, the summer may have them looking back wistfully. The release of their latest financial figures might shake some sense into those who think that Rafael Benitez's possible departure will make things better. Liverpool, as the figures show, are in great peril. In six months, the Benitez era will seem like a golden age.

The idea that Jose Mourinho can be parachuted in to save the club should crash up against the reality of these numbers. For the second successive year, the auditors, KPMG, expressed "material uncertainty" about Liverpool's ability to continue as a going concern.

The new chairman Martin Broughton has had to appear before the Premier League to give a guarantee, which had to be backed up by the banks, that Liverpool will be able to fulfil their fixtures next season (anyone who saw Liverpool's performance in Portsmouth this season may question if that guarantee was given last season). Yet some people cling to the view that Liverpool need simply to sign a new full-back. There is no quick-fix for Liverpool. There may be no slow-fix either.

This weekend, it does not seem as inevitable that Benitez will leave. At this stage, the decay has affected him so profoundly that it would be no bad thing for him to go. At the very least, his departure would allow those who criticise his management to understand slowly what he was up against. Alan Curbishley won't be able to do much better.

On Friday, an internet campaign launched by a Liverpool forum resulted in journalists receiving hundreds of emails from supporters backing Benitez. It is customary for their loyalty to be applauded slightly patronisingly at this point before asking at what other club would a manager be backed in this way?

Benitez earned their loyalty by providing as magical a night as any Liverpool fan has experienced in Istanbul, defying Chelsea in the semi-final and challenging for the title last season. He earned their loyalty by being misunderstood, as Liverpool people feel they are, and he earned their devotion by rumbling Tom Hicks and George Gillett.

So when they chant his name or send an email, they are not displaying blind devotion. They are acknowledging the complications of managing a club that has no future until things change and recognising that Benitez has, imperfectly, managed until this season somehow to keep Liverpool competitive.

Once Liverpool's players started spinning about the race for fourth and once Benitez started talking about how the value of the club had increased during his time at Anfield, then things were destined to unravel. That was not Benitez's racket. At his best, he felt no need to point to his record because he didn't respect the people who were looking it up.

They were wrong about everything: wrong about his transfer record, wrong about rotation, wrong about how often he rested Torres. Yet they never shut up and they wore Benitez down. The reasons Rafael Benitez is no longer the right manager for Liverpool are exactly the same as the reasons he was such a successful manager of Liverpool. His stubbornness allowed him to ignore the voices that told him he should buy Michael Owen or play Steven Gerrard in his "favoured" central midfield position.

Then he became distracted and demented by the financial position and gaining control. His attempt to sell Xabi Alonso was a disaster -- not because Alonso was in sparkling form and it made no sense -- but because his return to form was achieved not by coaxing the best from him but by instilling a sense of resentment that made his departure inevitable.

One of the key tenets of Benitez's philosophy is that he does not get close to the players. There is nothing wrong with that but it works best if the manager does not hold resentments if the players react to that distance, as Alonso did. The sadness in the fracturing of the relationship with the player once known as 'Son of Rafa' was compounded when, having taken the biggest risk of his career at Liverpool, Benitez barely saw any of the transfer fee.

Instead, he was forced to gamble on a fragile player like Alberto Aquilani and the pressure was on once it quickly became apparent that the title would not be achieved as many had expected. Benitez had been exhausted by the battles he had to fight. He was contaminated by the bullshit coming down the line and the players appear to have had enough.

Just as his success masked the dysfunction of the regime he was employed by, his failures have hidden them too. Benitez took on Hicks and Gillett and paid the price: not the loss of his job but the loss of his vision of what the team should be. Like all obsessives, he is always at risk of losing touch with reality.

Liverpool, out of the top four and with their most glorious footballer Fernando Torres agonising over his future, have more chance of sinking further next season than they do of reclaiming a Champions League place.

Torres is not bigger than the club, the old cliché that may yet be used by the accountants this summer after he makes an impact on the balance sheet, but there is a strong case to be made that it stands or falls with him right now. For many reasons, Torres is no ordinary footballer. He is loyal and curious about his surroundings. His talent ensured he would be a favourite at Liverpool, but his heart quickly bound him to Anfield. His disillusionment, not about last season, but about the future, is likely to see him leave in the summer. Even if the banks were to allow Liverpool to replace him, he is irreplaceable.

Broughton has announced that Liverpool do not need to sell him to service their debts but when £85m has been paid in interest since 2007, the needs of the money men can sometimes become insatiable.

Torres will have his choices and he may decide, despite their failure to qualify for the Champions League, that Manchester City are the best option. Certainly, they can offer a challenge in the future that Liverpool cannot. If they could persuade Torres then it would be a spectacular announcement of their intentions which could speak even louder than qualification for the Champions League.

Liverpool are being squeezed by teams who have been allowed to build and clubs that have not been so badly run. Tottenham's progress has been through shrewd investment and the acquisition of a squad that Liverpool can only envy. Peter Crouch might have stayed at Liverpool if he had been offered a contract that would have made his time on the bench bearable. Instead, he ended up at Spurs, along with Robbie Keane, who played no more time at Tottenham than he did at Liverpool but nobody seemed to notice before he headed off to Glasgow.

City and Spurs are ready to replace Liverpool. They have energy, ambition and new ideas. Liverpool are just trying to make it through the night. They have been ripped from their community by the decision of David Moores to sell the club to Hicks and Gillett. The desire of supporters to see the club return to ownership they understand has now been replaced by the pressing urgency to find somebody to rescue them.

There was a time when Moores and Rick Parry (who received a pay-off of £3m, the latest accounts revealed) searched the world looking for new investment. Moores could have borrowed on the club to build a new stadium instead of selling to the Americans, who were borrowing on the club to buy it, and Liverpool would be in a better position today. Instead, he made a rash decision and a poor business one for him and for Liverpool.

Those were the good days when the world felt it could trust people like Hicks and Gillett. Because there were so many of them, they must be doing something right.

Last week's accounts showed Liverpool's loss was 34 per cent worse than 2008's figure as £40.1m went on servicing the club's £351.4m debt to Royal Bank of Scotland and US firm Wachovia. These loans have been extended until the sale but the club is now, according to KPMG, "dependent on short-term facility extensions". They are living hand to mouth. And yet they claim that Torres doesn't need to be sold. They do not need to sell him, much as a wino doesn't need a bed for the night.

It is worth noting that the accounts were taken in a good year for Liverpool, a run in the Champions League and second in the league. Next year, if there is a next year, things will be worse.

But still they blame the manager. Benitez is said to be torn about his departure. A number of senior players would be happy to see him go and a number would prefer if he stayed. His management style is undoubtedly wearing on players but Liverpool aren't faced with too many alternatives.

Few managers will be tempted in the summer to join a club which may not still have owners and has no money. Martin O'Neill is the only candidate who appeals, especially if he feels he has done as much as he can at Aston Villa. Liverpool may not end up like Leeds but there is every indication they could end up like Newcastle, who, unlike Liverpool, had a stadium that gave them the revenue to compete. Liverpool have nothing, not even freedom, as that isn't afforded to the indebted.

The days of standing on the edge of the abyss are over, Liverpool have fallen over the edge. Benitez seems reluctant not to fall with them. He staked his reputation on the club and he found that even when it plummeted, he didn't want to give it all up.

He has been promised riches and finances at Juventus but still he hesitates. He is bound by something more. He is a flawed hero but history will see his management as no less heroic for the reality that it was doomed.
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Old 10th May 2010, 15:30   #2 (permalink)
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What next for Liverpool?
Mediocrity.
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Old 10th May 2010, 15:31   #3 (permalink)
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Here is the RAWK reaction to this article:

In 6 months, the Benitez era will look like a Golden Age
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Old 10th May 2010, 15:32   #4 (permalink)
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They only way back in to top 4 is the long way. No short cuts. They have to accept the fact that they simply are not top 4 material anymore. Build up slowly from the ground. That means deconstructing what there is at the moment
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Old 10th May 2010, 15:35   #5 (permalink)
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They're doing well to spend the money on players like Shelvey and Wilson from Rangers. These players will hopefully (from thier point of view) take the place of bizarre signigns like Degen and Gonzalez in the past who've been bought for pittance, but already in thier prime and aren't going to get better. By focussing on youth who will make mistakes but blooom into decent players, they have a decent enough strategy.
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Old 10th May 2010, 15:37   #6 (permalink)
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It very much depends on what happens over the summer. If they get some mega rich Arabs buying them and throwing money around they'll be back at the sharp end in no time. They are, no matter what our feelings towards them are, a club with history and the right image around Europe to attract big names. However if the Americans are unable to sell then they will be stuck in mid table mediocrity for a good while to come while those around them improve their squads.
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Old 10th May 2010, 15:39   #7 (permalink)
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New manager, new owners and a new captain for starters it seems.
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Old 10th May 2010, 15:40   #8 (permalink)
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The thing is they really aren't a great prospect for buying, cost to much, a lot of money needed in the squad, a whole new ground needed soon. A very average team like Stoke or Wolves must seem like a much better purchase.
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Old 10th May 2010, 15:43   #9 (permalink)
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New manager, new owners and a new captain for starters it seems.
Add on a new stadium and you may as well just launch a new club?!
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Old 10th May 2010, 15:43   #10 (permalink)
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Getting new owners is far from a done deal for Liverpool. They've had a few consortiums sniffing around them for a while, but there hasn't been a bid, which probably tells you everything you need to know. They need a new stadium, and massive investment in the team. It may take longer than Liverpool fans would hope to get out from under this mess.

To add to that, if they can't offload Benitez to another team, they're going to have to spend big money to pay him off.

What manager would want to go into that sort of situation? I can see O'Neill leaving Villa this summer, and if he does, he might well be the sort of appointment they'd try to make.
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Old 10th May 2010, 15:46   #11 (permalink)
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It very much depends on what happens over the summer. If they get some mega rich Arabs buying them and throwing money around they'll be back at the sharp end in no time. They are, no matter what our feelings towards them are, a club with history and the right image around Europe to attract big names. However if the Americans are unable to sell then they will be stuck in mid table mediocrity for a good while to come while those around them improve their squads.
This.

It's all dependent on the future of Torres/Gerrard/Benitez/the sale of the club.

If all goes against them they are truly fucked.
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Old 10th May 2010, 15:46   #12 (permalink)
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Maybe they need to accept that this might be their level.

I keep hearing stuff about Liverpool being a great club, and that they deserve better.

Do they? Almost 20 years of constant failure and massive spending. Surely it could only go on so long before the arse fell out of it.

A bit less hysteria, and a bit more acceptance of reality.
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Old 10th May 2010, 15:52   #13 (permalink)
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Start again.

Supposedly the youth system there is a shambles. If that is so, then they have a lot of work to do.
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Old 10th May 2010, 16:23   #14 (permalink)
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Newcastle, Leeds and Forest have all been relegated in recent years
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Old 10th May 2010, 16:58   #15 (permalink)
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Old 10th May 2010, 19:06   #16 (permalink)
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the new chant will be "next year we will qualify for the CL"
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Old 10th May 2010, 19:19   #17 (permalink)
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Things must be bad for Liverpool, so depressed are they that not one of their fans sent me a text yesterday gloating about Chelsea winning the premiership, I was expecting a barrage
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Old 10th May 2010, 19:28   #18 (permalink)
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They are in a bit of a bind. The best way out would be to negotiate Benitez's departure, bring in a proper manager, and sell Torres to fund 3-4 very good players for the new gaffer. But shhhh. Pray that this doesn't happen.

K.R.A.P!
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Old 10th May 2010, 19:41   #19 (permalink)
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Depends on who buys them. I am hoping that we have another Mike Ashley situation where they struggle to find someone to buy them. I doubt it though.
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Old 10th May 2010, 20:28   #20 (permalink)
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The one in the city centre is the biggest one, but there is a smaller Next in the south west.
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Old 10th May 2010, 20:28   #21 (permalink)
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They should go for sharing a new ground with Everton - share the costs of construction & still get increased revenue, but their pride won't let them.
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Old 10th May 2010, 20:30   #22 (permalink)
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Old 10th May 2010, 20:31   #23 (permalink)
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They should go for sharing a new ground with Everton - share the costs of construction & still get increased revenue, but their pride won't let them.
I agree. Its so obvious. If Milan can do it, I see no reason why Liverpool should not.
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Old 10th May 2010, 23:17   #24 (permalink)
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They should go for sharing a new ground with Everton - share the costs of construction & still get increased revenue, but their pride won't let them.
I saw this on the Mirror's website. It's an interesting proposal but somehow I just can't see it happening, can you?

Quote:


Liverpool and Everton could build back-to-back new stadiums, according to amazing new plans.

The Mersey Stadia-Connex group say their revolutionary idea would cost the Merseyside giants around £200m less than having their own separate new grounds.

The clubs would share a hospitality facilities, 150 executive boxes and a vast underground car park, together with a 300-room luxury hotel.

Liverpool's new stadium would hold 60,000 fans - 15,000 more than Anfield - while Everton's would have room for 50,000, a rise of 10,000.

A spokesman said: "We need to reach the prospective new owners of Liverpool FC to inform them about this sensational investment opportunity.

"Most fans will understand the many advantages and financial implications. This scheme differs from all previous concepts during the last decade in that we believe it manages to achieve all the clubs objectives."

Liverpool remain committed to building a new stadium in nearby Stanley Park, while Everton's prospective move to Kirkby has stalled after a snub from the government for development money.

A Goodison spokesman said the so-called 'Siamese stadia' plan was "unworkable".


Liverpool and Everton 'to build side-by-side stadiums' to replace Anfield and Goodison - MirrorFootball.co.uk
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Old 11th May 2010, 01:39   #25 (permalink)
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I saw this on the Mirror's website. It's an interesting proposal but somehow I just can't see it happening, can you?
cracking idea that.
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Old 11th May 2010, 08:44   #26 (permalink)
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I'm not convinced that next year will be as bad for Liverpool. I think it was a blip, in the same way that the previous season's 2nd place was a blip th other way. I think they will be challenging City for 4th next season, maybe also Spurs if 'arry can motivate them again - but I don't see them finishing below Villa or any other team.

Whether the current position is Benitez's fault or not is a matter of opinion, but the one thing Liverpool need to do is to replace him because a new manager with fresh ideas will galvanise the existing players. I just think the owners are waiting for someone to make an offer so they don't have to pay his huge severance bonus. I still don't see him there at the start of next season.
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Old 11th May 2010, 08:51   #27 (permalink)
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I'm not convinced that next year will be as bad for Liverpool. I think it was a blip, in the same way that the previous season's 2nd place was a blip th other way. I think they will be challenging City for 4th next season, maybe also Spurs if 'arry can motivate them again - but I don't see them finishing below Villa or any other team.

Whether the current position is Benitez's fault or not is a matter of opinion, but the one thing Liverpool need to do is to replace him because a new manager with fresh ideas will galvanise the existing players. I just think the owners are waiting for someone to make an offer so they don't have to pay his huge severance bonus. I still don't see him there at the start of next season.
Performance wise yes.

But this bad season can have a domino effect for years to come. You hear it 2nd.
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Old 11th May 2010, 09:27   #28 (permalink)
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For a start they need to get rid of the american owners. They are one cause of the Rot.

The manager is another, For all that some fans love him the fact is he has spent ALOT of money and all he has to show for it is a couple of cups, and the 2005 CL win was with Houlliers team if you ask me.

Then the squad needs a complete overhaul. Gerrard , torres and mascherano and the keeper reina are the only ones worth keeping the rest need to go. David Ngog....Please.
Saying that I cant see Torres staying too long more, one more rubbish season and he is off.....thats if he even stays past the summer

Its basically goiong to be a long road back for them and as mentioned unless they get a billionaire to start throwing money in I fear for them I really do.
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Old 11th May 2010, 10:06   #29 (permalink)
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I'm not convinced that next year will be as bad for Liverpool. ...
It could be even worse - just think what might have happened if Everton had not started so badly this season.

Without new owners who can pay off their debts, I doubt Liverpool will be able to strengthen their squad and may well even have to sell one or more of their better players
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Old 11th May 2010, 12:14   #30 (permalink)
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I saw this on the Mirror's website. It's an interesting proposal but somehow I just can't see it happening, can you?
Is this a joke?
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Old 11th May 2010, 17:37   #31 (permalink)
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I saw this on the Mirror's website. It's an interesting proposal but somehow I just can't see it happening, can you?
what a stupid stupid idea! I mean what is the point of that? Its a complete waste of space, money and effort. Just build one mega stadium, make it the best in Britain if ego's are getting in the way and be done with it. This proposal smells of someone smoking some hot shit!
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Old 11th May 2010, 19:33   #32 (permalink)
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"For the second successive year, the auditors, KPMG, expressed "material uncertainty" about Liverpool's ability to continue as a going concern." '

Holy feck, I work at an accounting firm myself, such auditor's reports are rare, this is really, really bad... unbelievable that it has come to this... lets hope for liverpool football club that there's some rich arab wondering what to do with his money...
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Old 11th May 2010, 23:24   #33 (permalink)
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Things look pretty dire for Liverpool. Of course it's difficult to get a real grasp of what the real numbers are at this point. Here's an attempt:

2007 - Club sold to H&G for £218.9m
2010 - Club reports debt of £472.5m

BBC SPORT | Football | My Club | Liverpool | US pair agree Liverpool takeover
Liverpool pile up losses as group debts soar to £473m | Liverpool - Times Online

So over the course of 3 years they have more than doubled (216%) the debt, assuming the original purchase was 100% borrowed. From what I remember H&G borrowed something like £340m at the start. What were the banks thinking?

For whatever its worth, Forbes recently ranked Liverpool as having a value of US$822 (£556.5m).
Soccer Team Valuations - Forbes.com

So whatever the true value of Liverpool is, they need someone to come in and pay that value in cash. Then borrow against the club in order to build the stadium they so desperately need. On top of all this there are the managerial and player uncertainties, and a backdrop of a Europa League campaign starting in late-July.

I suppose its not out of the question they could find someone to buy the club and invest in the stadium, presuming that whatever purchase price is paid is reasonable.
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Old 12th May 2010, 19:27   #34 (permalink)
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Damn the football press are woeful at reporting financial information. After much digging I was able to find some basic information that is of interest, Liverpool's operating numbers (all numbers in £millions).

Operating Revenue
2007/08 - 159.1
2008/09 - 177.3
Change = +18.2 (11%)

Operating Costs
2007/08 - (148.9)
2008/09 - (193.4)
Change = (44.5) (30%)

Operating Profit/(Loss)
2007/08 - 10.2
2008/09 - (16.1)
Change = (26.3)

Liverpool accounts: wages soar past £100m, losses £55m, debt up to £378m (and the bank needed paying in March) Sporting Intelligence

First thing that jumps out is the growth in costs of 30%. Where the hell they spent that money is a mystery to me. Following on from that, Liverpool are reporting an Operating Loss of 16.1 million, which is a surprise considering this is all before interest and player sales/purchases.

The numbers for this year (replacing the Champs League with Europa and the 7th place finish) will be worse I would think.

The numbers for next year with no Champs League only Europa and whatever their league position winds up being could be ugly.
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Old 13th May 2010, 02:22   #35 (permalink)
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What went wrong? One word. Rafa. His decisions were awful, in last 2 seasons. The keane episode, Alonso's sale, worthless buys, He has wasted so much money...and no wonder the owners are having doubts on backing him up, debt or not.

Nest season depends on whether they keep Torres or not. I can only see a further drop, it they do sell...and it will definitely be followed by Stevie G sooner or later and that the proverbial last straw. Goodbye Liverpool.
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Old 13th May 2010, 02:57   #36 (permalink)
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If getting new, rich owners was all it took to get into the big time then City would have done it this season. It's not as simple as that. Liverpool also need Rafa, or a new manager, to perform. They are facing a distinctly tricky future.
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Old 13th May 2010, 03:12   #37 (permalink)
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I thought about this a lot too. Because they have fallen a long way, Tottenham and Manchester City both have better squads IMO. I think the road back to the top 4 might be a long one. Its a club with a lot of dept, a handful of great players.

Reminds me of Leeds United... Lots of world beaters, lots of debt, they are sitting on a half financed new stadium.. Far away from getting a important Champions League income witch equals £30-60m+... Hicks and Gilett will want the same amounts they put in, preferably keep the debt at Liverpool, etc. I think Liverpool are in big trouble right now.
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Old 13th May 2010, 08:37   #38 (permalink)
From Barca to Orient - back down to earth with a bang
 
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If they dont get in a new and decent manager to put some basic stuff right and quick, and keep Gerrard and Torres then they are fked - maybe for ten years or more imo

After all the blarney and hot air telling Everton "we are bigger than youse" and wont share a ground they'll be begging to share in 5 years should this carry on !

Nice one Rafa
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Old 13th May 2010, 09:35   #39 (permalink)
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Liverpool's problem is the burden of high expectations.

I think that they need to imitate Arsenal's approach to cultivating young players on the pitch and hope that some investor with deep pockets buys the club off the pitch.
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Old 13th May 2010, 09:59   #40 (permalink)
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who are their 8 homegrown players
last i checked they needed a few reserves to get 8 .. if that is the case , they will struggle to have a solid squad with quality backup ..
more of the same then
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