Post by QPR Report on May 13, 2009 21:16:39 GMT
The Telegraph/Jeremy Wilson
Value of football clubs has plunged in credit crunch, says Keith Harris
Keith Harris, the former Football League chairman who helped broker takeover deals at Chelsea, Aston Villa, West Ham and Manchester City, has estimated that the asset value of clubs has fallen by up to 20 per cent during the economic downturn.
Harris has also been involved with potential investors at Liverpool, Newcastle and Everton over the past year and, after working into what he called "the teeth of the gale of this recession", he says there are encouraging signs.
"The equity value of football clubs has declined over the last six to nine months," he said. "Generally asset values have fallen – 10-20 per cent is a decent estimate. Green shoots is an overused phrase but the world is feeling better.
"It could not have been quieter than the last three months of last year, not just for football. It's much more encouraging but there was zero interest for a long period."
With Liverpool co-owners Tom Hicks and George Gillett needing to refinance their £350 million loan with Wachovia and the Royal Bank of Scotland by July, Harris is more optimistic about their chances of reaching agreement.
"I would be more positive about them refinancing because the banking sector didn't quite melt down," he said. "The only way banks can make money is to start lending again."
Harris also criticised ownership arrangements that involved taking money from a club's day-to-day running and believes there will be no more leveraged takeovers. "Banks are either incapable or unwilling to lend money on a highly leveraged basis," he said.
www.telegraph.co.uk/sport/football/5320522/Value-of-football-clubs-has-plunged-in-credit-crunch-says-Keith-Harris.html
Value of football clubs has plunged in credit crunch, says Keith Harris
Keith Harris, the former Football League chairman who helped broker takeover deals at Chelsea, Aston Villa, West Ham and Manchester City, has estimated that the asset value of clubs has fallen by up to 20 per cent during the economic downturn.
Harris has also been involved with potential investors at Liverpool, Newcastle and Everton over the past year and, after working into what he called "the teeth of the gale of this recession", he says there are encouraging signs.
"The equity value of football clubs has declined over the last six to nine months," he said. "Generally asset values have fallen – 10-20 per cent is a decent estimate. Green shoots is an overused phrase but the world is feeling better.
"It could not have been quieter than the last three months of last year, not just for football. It's much more encouraging but there was zero interest for a long period."
With Liverpool co-owners Tom Hicks and George Gillett needing to refinance their £350 million loan with Wachovia and the Royal Bank of Scotland by July, Harris is more optimistic about their chances of reaching agreement.
"I would be more positive about them refinancing because the banking sector didn't quite melt down," he said. "The only way banks can make money is to start lending again."
Harris also criticised ownership arrangements that involved taking money from a club's day-to-day running and believes there will be no more leveraged takeovers. "Banks are either incapable or unwilling to lend money on a highly leveraged basis," he said.
www.telegraph.co.uk/sport/football/5320522/Value-of-football-clubs-has-plunged-in-credit-crunch-says-Keith-Harris.html