Liverpool sale: FSG’s reported interest in selling their club makes sense given current financial conditions
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No sooner has one of the Premier League’s big six changed hands for a record price than a stake in another of the grand old institutions of English football is made available for purchase. The 12 year stewardship of Fenway Sports Group (FSG) at Liverpool could change irrevocably with the owners confirming that they are ready to consider third party investment in the club.
Coming in response to a report by The Athletic that states that FSG have instructed Morgan Stanley and Goldman Sachs to assist in selling the club, it is hardly a ringing commitment to extending their extremely successful custodianship at Anfield. “There have been a number of recent changes of ownership and rumours of changes in ownership at EPL [Premier League] clubs and inevitably we are asked regularly about Fenway Sports Group’s ownership in Liverpool,” said the statement.
“FSG has frequently received expressions of interest from third parties seeking to become shareholders in Liverpool. FSG has said before that under the right terms and conditions we would consider new shareholders if it was in the best interests of Liverpool as a club. FSG remains fully committed to the success of Liverpool, both on and off the pitch.”
It is not hard to spot the most obvious rationale for a sale. When FSG swept in to end the acrimonious tenure of Tom Hicks and George Gillett they paid just £300 million for a distressed asset on the field, one that was at risk of administration if it was not taken out of the hands of its then owners.
The profit they now stand to make on it would be gargantuan. A string of unique complexities might have underlined the last sale of a Premier League superpower but the pure number is staggering. The consortium of Todd Boehly and Clearlake Capital paid £4.25 billion to secure Chelsea. One could make a case for the intrinsic value of Liverpool being even greater. They will soon play in a 61,000 seat Anfield, they consistently made profits before the COVID-19 pandemic, their revenues were around £50 million higher than Chelsea last year and their global reach is perhaps one of the biggest in the sports.
In that sense it is easy to see why FSG might be inclined to take their money and run, but their decision to up sticks contrasts markedly with the bullish assessment of an individual such as Jose E. Feliciano of Clearlake Capital, who believed Chelsea’s revenue can be more than doubled from £436 million in 2021 to £1 billion in the future. Why would FSG leave all that on the table?
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The failure of the Super League looms large over FSG. Their founder John W. Henry was a significant driving force behind the proposed breakaway league and the then-triumvirate of Premier League clubs with American owners (Liverpool, Manchester United and Arsenal) were widely viewed as more enthusiastic backers of the project than the likes of Manchester City. The aborted competition brought with it a guarantee of revenues that they believed would eclipse Champions League earnings. Since it has failed, these clubs have reverted back to the relative instability that comes with fighting for your place among the elite year in, year out. Last year Jurgen Klopp’s side earned over £100 million for their run to the final in Paris. Next season they may not even be in the Champions League.
As the Athletic notes, there are no guarantees that this process will end with the club changing hands. But, as CBS Sports reported in September, this is a boom market for the purchasing of Premier League clubs. The relative strength of the dollar enables US investors to get more bang for their buck and there should be no shortage of interested parties, including several who were spurned in the Chelsea sales process. Former chairman Sir Martin Broughton helped the club into FSG’s hands 12 years ago, might the consortium he constructed for a failed attempt at a Stamford Bridge takeover be revived?
Others will almost certainly come calling as well. After all opportunities like this rarely come along. A stable club with a rich history, a track record of success in the present, a sizeable stadium redesigned for the modern age and a fanbase whose vibrancy and passion is the envy of many. Liverpool has it all.