Share Liverpool FC - Fans Buyout Initiative

redspider

You've probably all heard about the Share Liverpool FC initiative ( www.shareliverpoolfc.com ). It is an interesting one, and one that will interest Liverpool fans at large but also football followers in general.

Here is the pertinent text from their website:

Share Liverpool FC – www.shareliverpoolfc.com

Liverpool Football Club needs our help.

We are 'Share Liverpool FC' and we have a real proposal for you: Let's put Liverpool FC in the hands of the only 'owner' who can be trusted. The fans. Become one of the 100,000 club owners and we guarantee you'll never walk alone.

Share Liverpool FC - Share Liverpool FC is a group of Liverpool fans, advised by some of the foremost experts in supporter and co-operative ownership in football. It includes:

Leading the initiative: Rogan Taylor, Kop season ticket holder and LFC fan for over forty years; founder member and Chair of the Football Supporters’ Association, launched in Liverpool after the Heysel Stadium Disaster in 1985. Rogan is currently the Director of the Football Industry Group at the University of Liverpool.

Advising the group: Supporters Direct: The organisation that assists in the formation of supporters’ trusts, and assists them in gaining equity and democratic representation at their clubs.

Kevin Jaquiss, of the law firm, Cobbetts, the top UK firm for co-operative and mutual law which has played a leading role in the development of mutuals and co operatives in housing, health and education. Kevin was part of the group which developed the Supporters Trust concept and wrote the model constitution which is now used by over 100 trusts in England, Wales and Scotland.

---

Why should Liverpool Football Club become a source of profit for anyone?

We propose a model of ownership similar to that at Barcelona. This club is owned by their ‘members’. Over 100,000 fans have bought single 'member' shares, which entitle them to elect a Board who will run the club until the next election. At Barcelona it is once every four years.

That way, no one can ever buy the club. Its structure makes its sale to the next sporting conglomerate that fancies a premiership football club a legal impossibility. The shares can never be sold; the club can never be sold.

Lets stop Liverpool Football Club becoming a trinket any rich man might like to wear around his neck. This club is close to the hearts of millions of people all over the world.

How much will it cost? We estimate that a sum of £5,000 each will be enough. We need 100,000 members. 100,000 x £5,000 = £500 million That should buy the club and go a long way towards building a new stadium.

How does it work? No one can own more than one ‘member share’ and, apart from the initial purchase, these ‘member shares’ cannot normally be sold on.

If you buy a ‘member’ share: No one will ever own more of Liverpool FC than you do, and you will be able to take part in any election to decide who runs Liverpool FC.

It’s one member, one vote. It’s democratic, it’s fair, and it protects Liverpool FC from becoming the target of corporate buyers ever again. What more could you ever do for your club?

- Secure ownership in law
- Debt free
- Real involvement

Sounds good, what do I do now?
If you want to be a part of this, and are interested in hearing more, simply use the ‘Your feedback’ link at the bottom of the page, or click ‘Count me in!’ above to add your name to the list. Once we get an idea of the scale of interest in this idea, we’ll know whether it’s a real possibility.

If you want to be a part of the ongoing history of Liverpool FC, now’s your chance.

FAQs

Isn’t this a pipe dream? You’ve no chance have you?
It’s no pipe dream; its do-able. Liverpool Football Club has millions of fans across the world. Most of them will have been worrying about what has been happening to our Club lately. And they’ll be realising that life as a Liverpool fan could get much more expensive.

There may be no plans yet, but ticket prices may have to be steeply hiked in years to come to help repay debts. We've seen what's happened already to season ticket holders at Man Utd. You have to commit IN ADVANCE to buy all home Cup games – without even knowing how many games that will be! It includes all League cup; FA and Champs League home games…. Say ten in total on average. That’s an extra £400 - £500 to add to the price of your season ticket at Old Trafford.

What will happen at Liverpool FC when the debts bite (and we have seen more and more debt secured on the Club’s equity)? There is around £180m of debt secured in Kop Holdings Ltd. and no answer to the question: Who will repay it when it falls due in a few years time? Our guess is that fans will bare the brunt in the end, not just in Liverpool but all round the world as the Club ‘sweats’ every asset.

So instead of us paying off the millionaire owners’ debts, why don’t we just buy it ourselves instead? Why would anyone want to pay off someone else’s debts?

Are you really going to get 100,000 people to sign up in this short a space of time?
We took nearly 50,000 fans to Istanbul – Athens too. In reality, it cost most of us between £1,000 and £2,000 to make the trip; more if we took our partners & kids along. Liverpool fans have always turned out when the Club needed them. They find the money somehow, even at short notice. And remember, there are literally millions of us round the world who really care about LFC.

Yes, but £5,000 is a lot of money. Won’t many Liverpool fans be effectively priced out of something they’d love to take part in?
Take your point. We don’t want to see any Liverpool fan excluded. We will seek to provide opportunities for groups of fans to purchase one ‘member share’ (carrying one vote) between them, providing they can nominate one individual to represent them.

Why shouldn’t I just wait and see what happens, without putting up any money?
You could miss out badly. The list will close. Also we will propose giving the first 20,000 people to respond special status and possibly enhanced advantages for ticket purchase. Those who commit first deserve some reward for their enthusiasm.

Modern sports clubs can’t be run like this, can they?
Why not? Many people know that Barcelona and Real Madrid are owned by their fans. So are German clubs, apart from Bayer Leverkusen. In fact, teams owned by their fans like this have won the European Cup 6 times since it became the Champions League in 1992. Even in USA, the NFL Green Bay Packers are run by a not-for-profit company; they’ve won the Superbowl 3 times despite having by far the smallest population of any NFL team.

That’s fine, but in Britain, especially if you need a new stadium, you need a sugar-daddy. That’s the reality, isn’t it? No. Look at Arsenal. They’ve no sugar-daddy. The club costed up its plans, secured loans and convinced people to lend to them at a fixed-rate. The Banks trust the club’s finances will be well-run and that fans will continue to watch the club.

If we could show how much fans of this club care, and how they’re prepared to back their faith with hard cash, then everything changes. We don’t need a sugar daddy – we ARE the sugar daddy - because most of the money comes from us in the end anyway.

How do we get investment in the future or cash to buy players?
If we have a well run, debt free Club to start with, there will be money to buy players (how much do you think is spent servicing the Club’s debts?). Also the elected Board may wish to raise money (as any business must sometimes). At Barca, very rich individuals stand for election with promises of further investment. But it doesn’t mean they ‘own’ any part of Club.

But surely this way of running things ‘mutually’ belongs to the past?
The Co-operative group, with shops, a bank, insurance and undertakers is run like this. It’s got a turnover of £8 billion a year, and buries 1 in 4 of us! It is also the biggest farmer in the country and the biggest retail co-operative in the world. It‘s owned by over 2 million customers, all owning one share.

What if we don’t get the £500m?
Lets say we only get £100m – the equivalent of 20,000 fans signing up. At that point we would ask the 20,000 ‘members’ what they want to do. Some of us might want – as a group (Supporters' Trust) - to buy a significant portion of the club’s shares. Certainly, at that point, any individual member who wanted the money returned would be entitled to it.

Can I sell my share later on? What if I need the money back in a rush?
The simple answer to the first question is no. There will be no ordinary‘trading’ in individual shares – no profit can be made from selling them - (otherwise the Club would be permanently ‘up for sale’ – just like Man Utd was). However, if a member can find someone who does not already own a member share, then a transfer at the original price may be arranged through the elected Board. Nobody will be asked to part with a penny until a detailed Constitution is presented in which all necessary details are made plain.

How do we know we’ve hit the target?
We will have a partner Bank where the monies will be kept until we reach the target. We will ask the two Bishops of Liverpool to act as verifiers for us – they’ll see the bank accounts, have access to all the books and be able to speak to the bank to certify that it’s all there. We will also ask the Liverpool City Council Treasurer to act as a scrutineer.

So, if we don’t make the targets and we all take our money back, what about the interest the money has earned? We’ll donate it to a Charity of your choice, less any deductions for verifiable expenses incurred in running the ‘Share Liverpool FC’ operation (website server charges; legal costs to draw up a Constitution etc.).

What will we get to vote on?
Members will elect the Board of Directors for Liverpool FC, for a term to be decided by you. (Barcelona elect their President every four years.) After an Election, just like the Government, the Board will have executive control of the Club, but they may want an elected ‘Fans’ Council’ to advise them. The Board will know that – in a few years time - they will be judged on their performance by the owners – YOU.


Will we get a vote on the team or the manager?
No. The elected Board has executive responsibility for running the Club.

Will members be guaranteed a ticket if they want one?
With100,000 members? You’re kidding!

Has anyone ever done this in UK before?
No, though there have been many formations of ‘Supporters' Trusts’ at professional clubs in the past decade– and three Football League Clubs are run by a majority shareholder Supporters' Trust. Liverpool would be the pioneers in completing a ‘members’ buy-out.

What we propose would probably start a ‘revolution’ in Club ownership structures in UK. But then, Liverpool fans have often been at the vanguard of changing the culture of football.

We have a question to ask you!
We want this to be a genuine fans’ initiative and we know something about the costs of professional advice. Are you in a senior position in banking; accountancy; corporate finance etc? Please contact us using the form below if you think you could provide voluntary assistance to this project.

Legal
If we go ahead with this, it has to be done properly and we will rely on Cobbetts and our other advisers to guide us towards a structure which is legally sound. This will mean detailed work in putting together a proposition and a constitutional framework which is clear and robust so that anyone who becomes a member will know exactly what is involved. At this stage, before this work is done, we confine ourselves to setting out in broad terms what we want to achieve.

In legal terms, Liverpool Football Club would have an ownership structure similar to that of Barcelona and to co-operatives in the UK and would be run on the principles used in modern mutuals. The key principles are:

That membership and elections work on a 'one member, one vote' basis

That powers and responsibilities are divided in a clear and effective way between elected representatives and skilled and experienced executives. That elected representatives do not manage the club or pick the team, but ensure it is run properly and efficiently.

That the organisation plays a constructive role in the community.

Furthermore
There will be predator protection to stop the mutual being taken over or dismantled, and at the start, members will be asked to approve a transitional board for the new mutual LFC on joining, and the first election of a Board will be held within the first year.

"The Barcelona model, to me, is how a football club should be run. They are one of the most pre-eminent names in world football, yet the club is owned by its supporters on a one-member, one-vote basis and they control it. That strengthens it because it's never subject to the whim of one person; it's a collective endeavour. English football should see that as a big strength. I'd love to see if we could grow the Barcelona model here." - Andy Burnham, Secretary of State for Culture, Media & Sport.

Mitch Connor

Read today that 50million has been pledged already. I wrote this off as a pie in the sky idea at the start, but 60million after just a few days is a phenominal result. Of course, I do wonder how much of that pedged money will end up actually being given, but the initial response has been more than favourable and, to me, surprising.

http://www.football365.com/story/0,17033,8698_3116949,00.html

Share Liverpool FC, the group looking for 100,000 fans to put in £5,000 each in a bid to buy the club, have confirmed that they have been pledged nearly £60m during the first four days of the scheme.


11,892 fans have pledged to buy a share of the club, which amounts to £59.46m in a bid to make the £500m needed for the buy-out.


Google has revealed that, as well as the 11,892 "count me in" responses, the site has also recieved 5,394 responses in favour of the idea but need more information to make their pledge and 7,930 responses from people who cannot afford it.


The UK, Norway, USA and Ireland are the four countries where most of the hits originated.


However, with only £60m made there is a long way to go to get up to the proposed £500m. It also must be said that it is easy enough to pledge £5,000 and then not go through with it.


Rogan Taylor, Share Liverpool FC's spokesperson, remains confident.


"These are pretty impressive numbers for just a few days with www.shareliverpoolfc.co.uk live on line and we're very encouraged," he said.


"The stats also reveal we have a lot of work to do to present more detailed information, and also to address the affordability issue many fans flagged up.


"What they will be buying is something that lasts forever - a share in Liverpool Football Club which cannot be disturbed.


"The member shareholder will be able to pass it on, down through his or her family generations; to sons and daughters, and grandchildren. You will sit in that new stadium and think: 'This belongs to us ...and so does the club that plays here!".

An Citeog

We propose a model of ownership similar to that at Barcelona. This club is owned by their ‘members’. Over 100,000 fans have bought single 'member' shares, which entitle them to elect a Board who will run the club until the next election. At Barcelona it is once every four years.

This is the only part I take issue with and I've already posted on it in the Liverpool thread. Saying that they're modelling their plan on that of Barça either shows a fundamental misunderstanding of the way in which FC Barcelona operates, or is just plain lazy. Essentially this is how FC Barcelona operates,

An Citeog wrote:

I posted it a few pages back, but this is essentially how it works:

• Approx 160,000 members pay €150 (not 100% correct) a year in subscriptions. Of this, approximately €10-15million goes towards the football club.
  
• The elected president is required to put up €25million (every 4 years). Laporta and the nine other board members each put up €2.5million when they were elected. I'm not sure if they had to do the same last year as Laporta was reelected without opposition.
  
• Spanish clubs negotiate their own TV rights with Canal+. This means that Barça and Real get far more than the other clubs in the league. This is in stark contrast to the Premier League, where TV money is divided betwee the clubs
  
• All profits are pumped back into the club. There are no shareholders which means there are no dividends to be paid.
  
• There's also the little matter of the Camp Nou which holds in excess of 95,000. This is a huge source of revenue for Barça
  
• Finally, I'm not sure what the story is in relation to image rights, but I know that Madrid make an absolute bomb with these (they were reported to be earning around €40million annually from David Beckham alone). I'm guessing Barça have some sort of similar structure in place but I'm not 100% sure.
  
  
  PS. It's also worth noting that footballers in Spain are given some very favourable tax breaks. They pay somewhere in region of 15-20% on earnings. This means that the clubs can afford to pay their players a lot less than English clubs as net earnings will be relatively higher.

The differences between this model and that proposed by Share Liverpool FC are numerous.

First of all, FC Barcelona members don't have "member shares", they have memberships. This may seem trivial but it's not. It means that there is no limit to the number of members Barça can have. It also means that the club gets an injection of cash each year from member's subscriptions, rather than a lumped payment up front. What Share Liverpool FC are proposing are member shares. With the club valued at £500million (:D) and each proposed share for a nominal value of £5,000, the amount of shares that can be issued by the club is limited to 100,000. This can't be increased without impacting on the value of member shares and on the degree of control that each member has in the club. It should also be worth noting that Barça currently have 60% more members than Liverpool would.

The stadium issue is fairly self-explanatory but it's also a major sticking-point. This is a very risky venture for a company with a lack of serious financial resources to undertake, particularly in the current climate. Liverpool would have to operate at a substantial profit just to be able to afford the repayments. Champions League qualification, rises in ticket prices etc would be essential to that.

My final point is in relation the presidential position at FC Barcelona. Laporta's motives are mainly political. It's a means for him to show how Catalan he is and he'll usually end his speeches with something along the lines of, "Visca el Barça, visca Catalunya lliure" (long live Barça, long live an independent Catalunya). Being president of Liverpool just wouldn't carry the same sort of social status, as much much as most Liverpool fans would like us to think it does. What people also need to remember is the state of the club before Laporta and the rest of the board took over. Corruption was rife, finances were terrible and they were playing in the Uefa Cup.

This is just the way I see it anyway and I wont pretend to be as qualified or knowledgeable as some of those involved in Share Liverpool FC seem to be.

mike65

However, with only £60m made there is a long way to go to get up to the proposed £500m. It also must be said that it is easy enough to pledge £5,000 and then not go through with it.

60 million pledged is good but many potential buyers are aware that DIC haven't gone away and they could well be joint owners having bought out Gilletts part of the club (that seems to be the likely plan of attack). It could all get very messy.

Mike.

x in the city

no disrespect but id imagine scousers would struggle to shed 50quid let alone 5000......:rolleyes:

Dubit10

x in the city wrote: »

no disrespect but id imagine scousers would struggle to shed 50quid let alone 5000......:rolleyes:

Ha Ha Ha aaaaaaaa.Muppet

zAbbo

x in the city wrote: »

no disrespect but id imagine scousers would struggle to shed 50quid let alone 5000......:rolleyes:

They seem ok to shed at least 30quid for each home game...

Mr Alan

x in the city wrote: »

no disrespect but id imagine scousers would struggle to shed 50quid let alone 5000......:rolleyes:

wat a stupid post.

mike65

Mods! Give X a slap!

Mike.

~Rebel~

I'm just wondering what the situation would be if this deal was a success, if everything went a bit pear shaped and we ended up seriously needing more money. Where does it come from? Do we have to start getting loans for the club with no real backer behind us?

At least with G&H they HAVE the financial clout behind them to save us should things capitulate. Im not sure how much they'd use it, but at least they have it, and can borrow against it.

Pool fans i presume would have to borrow against the club, with no revenue except for the clubs assets, which would probably not be able to make this money back given the situation we'd be in to be borrowing in the first place. Sounds like a slippery slope to me if anything goes wrong..

<edit> Also, 'X', nearly 50,000 pool fans managed to shell out to make it to Athens and Istanbul for the champions league finals.

Mr Alan

~Rebel~ wrote: »

At least with G&H they HAVE the financial clout behind them to save us should things capitulate. Im not sure how much they'd use it, but at least they have it, and can borrow against it.

But they dont Rebel, they are not really THAT wealthy, and if at the end of the day they were faced with giving up all their personal fortunes to clear Liverpools debt or sending the club into administration, wat do you think theyd pick?

Mr Alan

X in the city, is a bluenose if i'm not mistaken, he is probably just bitter (who would have figured that!) that the self titled "peoples club" will not even be based in Liverpool in the very near future

~Rebel~

Mr Alan wrote: »

But they dont Rebel, they are not really THAT wealthy, and if at the end of the day they were faced with giving up all their personal fortunes to clear Liverpools debt or sending the club into administration, wat do you think theyd pick?

I know, as i said, they probably wouldn't, but at least they have money that can be borrowed against, whereas I assume with no financial backing whatsoever, this fan buyout scheme would have to loan against the club, which would probably get more difficult to do as the club gets steeped in debt, with no ability to remove it or pay it off. Not sure how we'd get out of a cycle like that..they or DIC or someone would at least have the ability to do Something. Id just be worried how we would solve any future financial difficulties after this first outlay. Would most likley just end up needing to sell again.

Mr Alan

but the fans buyout would be clearing any debt that is currently on the club, so they would be starting fresh and borrowing against future earnings, which is pretty much wat G&H are going to do anyway, also the fans consortium might possibly be able to get it paid off sooner/borrow more as they dont have to worry about any of the profit the club makes being taken by the owners, it'll all be ploughed into the running of the club and paying off of its debts.

~Rebel~

Mr Alan wrote: »

but the fans buyout would be clearing any debt that is currently on the club, so they would be starting fresh and borrowing against future earnings, which is pretty much wat G&H are going to do anyway, also the fans consortium might possibly be able to get it paid off sooner/borrow more as they dont have to worry about any of the profit the club makes being taken by the owners, it'll all be ploughed into the running of the club and paying off of its debts.

Its all good if everything stays great and we keep making the CL etc but Id still just be wary IF things went wrong, how this system would be able to dig itself out of a hole. Id imagine once we started getting loans against the club it could spiral a bit out of control. It would probably work better After we had the stadium built and we got better sponsorship deals etc.

I dont particularly know about this stuff, so just trying to figure it out, should a worst case scenario occur.

Mr Alan

true, be a lot lot lot easier if the stadium was built.

In a perfect world, DIC would take Hicks stake, Fans would take Gillettes stake.....get the stadium built, and in ten years or so, buy out DIC.

that easy

PHB

I'd really like this to happen, I think its a great initiative, but I just can't see it working. Aside from the fact its significantly different to Barca (which I do think is close to the ideal of how a club should work. Specifically I don't see how the club would work without the ability for investment, which this model seems to get rid of. This is essential) I just can't see enough money being raised.

If each person commits 5k, you'd need 100k people to commit. I don't think any club has that many fans that would be willing to commit that much. I thought the idea of trying to float it was a good idea, cause it would allow fans who have lots of money to help it get that way. You could restrict this in terms of stopping any majority share holder happening. But the way it is going, I just can't see that many people committing.

What could happen though is, the club is estimated to cost 500 million. That however includes the debt that is owed. If the supporters took on the debt, the cost would be significantly reduced to 300ish million. That would be a much more achieveable figure, and while of course you'd have to pay off the debt, at least it would be working towards something.
I think floating is a much better objective, and its possible you might be able to get the supporters to at least own a majority share-holding in the club.

Either way, while I don't think it will work, I really hope it does. The bigger a club does get, the tougher this becomes. I can't see it ever happening with United because of the value, but maybe Liverpools value is still low enough to make it happen, but I doubt it

Helix

say the fans do buy pool right, where is the money going to come from for transfers?

Mr Alan

same place as it will come from under G&H.

homerjay2005

Mr Alan wrote: »

same place as it will come from under G&H.

Bank of scotland?

Daemonic

Helix wrote: »

say the fans do buy pool right, where is the money going to come from for transfers?

Essentially the club would be a not-for-profit organisation so any profit left over could be ploughed back into the playing staff etc. The obvious problem is if there are no profits then there are no transfers.

ziggy

This post has been deleted.

Mr Alan

because they dont have the financing in place for the stadium. they need to re-finance all over again in 18 months. at the moment they only have a little percentage of the total amount that'll be needed to build the stadium.

ziggy

This post has been deleted.

~Rebel~

ziggy wrote: »

This post has been deleted.

It all depends on how the next 18 months go, for LFC and, moreso, the economy. They were very lucky to get the refinancing deal this year, was looking very close to not happening due to the credit crunch.

denashpot

great idea. wish i had the money to do it. hate the american owers we have.

hopefully the euro millions will be won by myself tonight or some other pool fan!!

Mr Alan

get a loan

denashpot

Mr Alan wrote: »

get a loan

lol, are you offering??

Mr Alan

go to the bank!

denashpot

Mr Alan wrote: »

go to the bank!

which one

Mr Alan

any one! lol

redspider

Yeah, I agree with you An Citeog that the Barcelona model is completely different than the proposed Share LFC model. There are a number of problems/difficulties with the proposal which will make it difficult to execute. I intend to contact them about the issues and I suggest you do likewise. Pulling it off in its current guise will be hard, but if there are some adjustments it may be, may be possible, albeit a long shot.

In terms of the financial clout of G&H, they have used their non-Liverpool assets to get access to funds/loans and they've used that to buy LFC, first with the 300m loan (they paid 220m to the previous LFC shareholders) and more recently with the 350m 18-month loan. However, they have not in net terms have to put in a cent of their own money (yes, they have personal debt but that's just accounting, as it can be moved onto the club in a blink of an eye). Share LFC obviously wouldnt have any other assets apart from the football club itself. It would have to be self-financing, from the revenues and income it would make. Whether that would make the stadium project more difficult or not is hard to tell, without getting into the nitty gritty details. But in general terms, I think G&H may get slightly better terms/more money than Share LFC would likely be able to muster. That could mean a quicker buildling of the stadium under G&H. But both approaches are doable and financially possible.

The key is of course maintaining success on the pitch. Whether a Share LFC-ran club will be able to do that any better than a G&H or DIC-ran club is open to debate and conjecture.

Redspider

Mr Alan

If DIC buy Liverpool, which it looks like they are going to... in a perfect world we could buy the club off them in 15 years when the stadium is built and paid off

Dub13

Mr Alan wrote: »

If DIC buy Liverpool, which it looks like they are going to... in a perfect world we could buy the club off them in 15 years when the stadium is built and paid off

But how much do you think it would cost then...?This Share Liverpool idea would have been easer to achieve 5/10 years ago.

redspider

Dub13 wrote: »

But how much do you think it would cost then...?This Share Liverpool idea would have been easer to achieve 5/10 years ago.

Yes, very much so. I dont think it is precedented in any sport for fans/members to buy it after it has become so successful financially. That, as they say, is a very big ask.

In terms of the Share-LFC proposal, here are some of my thoughts:

> Let's put Liverpool FC in the hands of the only 'owner' who can be trusted. The fans.

Fans cant be trusted to run a club no more than anyone else can, including perceived unscrupulous owners who are only there to make a buck. It is clear that there is a relationship between a club making profits as a business and success on the field – indeed, success on the field brings in money/profits, which can drive further success, etc. It’s a virtuous circle. But who is to say that a fan-ran club will be any more successful than an ‘owner’ led one? There are no guarantees. Non-member fans will have a right to be vexed at Share-LFC-member fans if success would suddenly go majorly awry, so it will create two sets of fans, those that have membership and those that don’t. Also, with a 5k ukp entry to that membership, its not as if the membership is open to one and all.

> Leading the initiative: Rogan Taylor, Director of the Football Industry Group at the University of Liverpool, advising the group: Supporters Direct: The organisation that assists in the formation of supporters’ trusts, Kevin Jaquiss, of the law firm, Cobbetts, a firm that has played a leading role in the development of mutuals and co-operatives (he wrote the model constitution which is now used by over 100 trusts in the UK).

It’s very useful having people like these who have been involved in supporters trusts, analysis of the football industry, mutuals, etc and for them to be active and lead the set-up. However, I think it should be stipulated up front that those involved in organising the set-up of Share-LFC and its formative years, should NOT be allowed on the committee or have ambitions to become ‘presidents’ of the club, etc. In that way, they can have no ‘conflict of interest’ or ‘self interest’ as it were. There is always a fine balance in any mutual, between the ‘executives’ and employees of the mutual and the members of the mutual itself. In many, the executives over the years adjust the constitution/operation so that the mutual becomes their ‘plaything’ and more for their benefit rather than that of the members, and indeed they reap plenty of rewards for doing so. I’m not saying that will happen with Share-LFC, but it could happen, and gradually. It will be a challenge going forward in a mutual the size of Share-LFC, valued at 350m+. To prevent any benefit accruing to the ‘founders’ of Share-LFC, they could declare that they will in no way have any benefit from being involved nor will have in Share-LFC. They should effectively be volunteers.

> We propose a model of ownership similar to that at Barcelona. This club is owned by their ‘members’. Over 100,000 fans have bought single 'member' shares, which entitle them to elect a Board who will run the club until the next election. At Barcelona it is once every four years.

There is a big difference between the clubs of FC Barcelona and Liverpool FC. For one, Barcelona is seen as something like the Catalan ‘international’ team (albeit the team is not made up of Catalans), so there is a huge amount of fervour and fanaticism. It’s not easy to match that, and it will take time to build up a Share-LFC mutual which has an equal level of 'commitment' among its members. There are difficulties electing a board for the first time at such a big club as Share-LFC would be. How will the credentials of the board be known by the 100,000? Are well-known faces (eg: an ex-Player) likely to be put up yet who would have less capability executive and board-wise than a non-entity? These problems are not easy to surmount. Also, in the early years and perhaps ongoing, 4 years is too long to keep a board. The Barca system is also different as new boards going up for election promise money for investment if they get elected. Is that what will happen at Share-LFC? Will we end up with ‘unscrupulous’ owners, who akin to politicians, are in (no matter what) for at least 4 years? And membership fees are completely different. This is NOT a Barca model and should not be dressed up as such.

> That way, no one can ever buy the club. Its structure makes its sale to the next sporting conglomerate that fancies a premiership football club a legal impossibility. The shares can never be sold; the club can never be sold.

Never say never. It can always go into receivership! But there will need to be some mechanism to transfer membership along, as people do not live forever. And surely people should not be expected to help buy a club and become a member of a mutual without their being any potential financial gain in the long term? Even mutuals have this as an option. So, at the very least the value of the shares/membership could rise with valuations of the club when they are made. Perhaps a ‘grey’ market at contolled prices could be made available via Share-LFC. Who knows, maybe a member will need 5k for a child's operation or something. Also, having a regulation that the ‘club can never be sold’, is that wise? Maybe at some point the club will need to be sold, or at least invested in again.

> Lets stop Liverpool Football Club becoming a trinket any rich man might like to wear around his neck. This club is close to the hearts of millions of people all over the world. How much will it cost? We estimate that a sum of £5,000 each will be enough. We need 100,000 members. 100,000 x £5,000 = £500 million. That should buy the club and go a long way towards building a new stadium.

Setting a figure of 500 million is already setting an indicative valuation on what Share-LFC is willing to pay for LFC. 5k per person is also high in comparison to what people currently pay for season tickets, and this will disenfranchise many. Why set the 500m value now? Like other ‘share subscriptions’, why not get a measure of interest first and gather amounts that people would be willing to pay, and then set the price and membership. Perhaps a vote could be UKP 1,000 and people could be limited to owning 5 votes. (or 500ukp and 10 votes, or another system). That would allow more people in at lower levels, and indeed choose the level they want. There is also no guarantee that the sum of ukp 500 million ‘will buy the club’. Even if the amount is seen at above the previous valuations, G&H will not want to sell it at anything less than 500 million if that’s what’s gathered by Share-LFC. In other words, Share-LFC are recealing their hand before any negotiating is done. Share-LFC have no plan B with the money if their bid to buy fails. Interest to charity should be an option.

> How does it work? No one can own more than one ‘member share’ and, apart from the initial purchase, these ‘member shares’ cannot normally be sold on. If you buy a ‘member’ share: No one will ever own more of Liverpool FC than you do, and you will be able to take part in any election to decide who runs Liverpool FC.

These benefits could still apply even if a lower vote level system is used, such as the ukp 100 level, and people having 1 to 5 votes. Maybe even the upper limit could be increased to 10k, with people having 1 to 10 votes.


More thoughts later ..... but generally there are a lot of factors with the proposed system which are against it. However, with some tweaking, it could be a vehicle that could make a bid for Liverpool, but I would expect it to take at least a couple of years to get going. That will give DIC another window of opportunity to bid for LFC if they want to prise it away from G&H, or Hicks.

Redspider