Liverpool FC’s current owners, Tom Hicks and George Gillett, have lost one battle in the effort to retain control of the club, with a British court ruling that they could not remove the current chairman, Martin Broughton, who is in favor of the sale of the club to a consortium led by Boston Red Sox owner John Henry.
Hicks and Gillett had attempted to remove Broughton, but RBS, from whom Hicks and Gillett borrowed the money to buy the club and to whom they owe substantial repayments, sought and received an injunction to prevent this. The American pair had earlier tried to remove the club’s managing director, Christian Purslow, and commercial director, Ian Ayre.
RBS claim that the attempted removal was a breach of an undertaking that Hicks and Gillett made with the bank.
In a statement they said, "RBS in its capacity as lender to the Kop group of companies received the benefit of various contractual undertakings from Mr Hicks and Mr Gillett in relation to the corporate governance arrangements that Mr Hicks and Mr Gillett agreed would apply to the Kop group of companies with effect from April 2010.
"Those undertakings provided for the appointment of Mr Broughton as chairman of the board and the appointment of the chief executive and commercial director of LFC to the Kop boards.
"As is well known Mr Hicks and Mr Gillett purported to make changes to those corporate governance arrangements on 4 October. This was in breach of those contractual undertakings.
It appears, too, that the American duo have been technically in default on the refinancing agreement with RBS, but that the bank had not enforced that default position in case it sent Kop Holdings, the company through which Hicks and Gillett own the club, would go into administration and risk incurring a 9-point deduction from the Premier League. According to reports, this could still happen if Hicks and Gillett have not repaid their £280m ($446m) debts by Friday's deadline.
While reports that this would cause Liverpool to be relegated by the May 2011 end of the league are excitable at best, it would certainly mean it would be impossible for them to qualify for the lucrative Champions League or even the less-lucrative Europa Cup.
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