High Court orders reversal of restraining order
Texan judge could endorse sale today
LIVERPOOL’S future is likely to be decided this afternoon when a Texan judge delivers his verdict in the latest and possibly last of a series of increasingly bitter courtroom battles.
Judge Jim Jordan will announce at 1pm British time – 7am in Dallas – whether the temporary restraining order (TRO) he put in place to prevent the club’s sale on Wednesday is to be overturned, as demanded yesterday by the High Court. That would allow the board and New England Sports Ventures (NESV), owners of baseball’s Boston Red Sox, to complete a £300m deal for another of the world’s most famous sports brands, and eliminate the threat of administration.
If Mr Jordan does not reverse the TRO then NESV, Liverpool’s board and the Royal Bank of Scotland (RBS), the owners’ main creditors, will have to decide whether to hold fire or press ahead with the transaction in defiance of the court.
“We’re nearly there,” Liverpool chairman Martin Broughton said last night. “We’ve still got to take away the restraining order.”
City A.M. understands that NESV is eager to make sure all legal elements are in place before completing the deal. A spokesman for Reds owners Tom Hicks and George Gillett, meanwhile, told City A.M. last night he was unable to speculate on what might happen today.
Either way, NESV appears to have fought off rival bidders for the time being. Asian billionaire Peter Lim yesterday withdrew his second bid, which is £20m higher than NESV’s, while the High Court heard that Liverpool’s board considered and rejected that bid and another from American hedge fund Mill Financial on Wednesday night.
Hicks and Gillett, who have resisted the sale, convened a hearing in Texas, the former’s home state, just minutes after Mr Justice Floyd granted an injunction against the TRO yesterday afternoon. There, Mr Jordan adjourned until today.
The High Court, meanwhile, gave Hicks and Gillett until 4pm BST today to scrap the TRO, or risk being in contempt of the court. Barristers for RBS, Liverpool and NESV all argued for an earlier deadline, as it was claimed the sale process would have to begin by 3pm today in order to be completed by close of business. RBS have a particular interest in enforcing that aspect as today is the deadline for Hicks and Gillett to repay £200m of borrowings.
NESV seemed certain to clinch the deal on Wednesday night until Hicks and Gillett stunned the board by presenting the TRO during their board meeting. Just hours earlier Mr Justice Floyd had effectively endorsed the sale with his first ruling, that the owners could not sack the board in order to stall a sale.
A sense of how close NESV has come to owning Liverpool was illustrated yesterday by their counsel David Chivers QC, when he portrayed Hicks and Gillett’s attempts to halt the sale. He told the court: “We are now the owners. The owners from beyond the grave are seeking to exercise with their dead hand a grip on this company.”