George Gillett and Tom Hicks, English Liverpool owners, have proposed an eight per cent increase in ticket pricing as well as taking on loans and money from investors in the amount of GBP 100 million to refinance the club’s GBP 240 million debt, Bloomberg News reports.
Gillett and Hicks have also considered an equity sale to help pay down the debt owed to Wachovia Corp. and the Royal Bank of Scotland.
In addition to increasing ticket costs, Liverpool may take away 1,000 regular seats and change them into corporate seating by mid 2011.
Investment banks Rothschild and Merrill Lynch drew a prospectus in March of this year stating that potential investors could gain a minority stake in the club for GBP 50 million. It also stated that Liverpool was planning on acquiring another GBP 50 million in loans at a high interest rate. About GBP 95 million of the GBP 100 million the club would have with the loan and the investment combined would go to reducing debt, according to the document.
Last week, the club announced a GBP 20 million sponsorship deal with Standard Chartered Plc. The club also profited during the summer transfer window with the sale of Xabi Alonso to Real Madrid for EUR 30 million. Commercial revenue is expected to rise to nearly GBP 112 million, up from GBP 59 million, within five years due to secondary sponsorship, according to the prospectus.
Liverpool’s holding company, Kop Football (Holdings) Ltd. revealed a loss of GBP 42.6 million for the year to July 2008 due to interest charges.
