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Liverpool 'Man in the Sand'


allawee
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Man in the sand

 

 

Interesting article. I think he is a fairly reliable source and usually unbiased.

Buying a football club does not normally involve the person doing the deal being the subject of an extraordinary vetting process, the potential owner being given a fanciful undercover name, and the whole thing ending up in the Royal Courts of Justice.

 

But Rafed Al Khorafi's attempt to buy Liverpool last summer, which came within hours of being concluded, involved all of that and more. I have discovered fascinating details which read like a thriller which Bollywood, let alone Hollywood, might find a shade too implausible.

 

The court case which City firm Seymour Pierce brought against Al Khorafi, a member of the powerful and clan-like Kuwati family, now looks like being settled. Investment bankers Seymour Pierce were responsible for advising the Kuwaiti on his proposed purchase of Liverpool and claimed various fees had not been paid. Khorafi's lawyers have now agreed to pay some of them but are, I understand, asking for more time to come up with the cash.

 

Yet the real colour to this story lies in the lengths Seymour Pierce's Keith Harris, who also doubles as the great wheeler-dealer of English football, had to go to in trying to negotiate the deal. After being vetted prior to his meeting with Al Khorafi, he had to travel to a hotel in Lebanon's Bekaa Valley, where, for a time, he was the only guest.

 

That's because Khorafi, whose long love affair with Liverpool was nurtured in the club's heydays of the 1980s, was very keen the negotiations should remain a closely guarded secret. To help achieve that goal, he was given the moniker 'The Man in the Sand' by Harris, while Liverpool were identified as 'The Target'.

 

The initial Khorafi approach came in February 2008, a time when the world had not yet slipped into recession and numerous buyers were hovering around England's top football clubs. But there was a problem, namely the testy relationship between Liverpool's two American owners, Tom Hicks and George Gillett. They had become the ultimate dysfunctional family, barely on speaking terms. Such was the tension between the two, that in the spring of 2008, Hicks, who had tried to buy out Gillett, demanded the resignation of chief executive Rick Parry only for Gillett to defend him.

 

 

 

Sometime in March, a meeting between Gillett, Hicks and Harris was arranged in Montreal. Given their relationship, Hicks and Gillett felt they could only meet under the auspices of the commissioner of the National Hockey League, who acted as a sort of referee. Both men own hockey franchises.

 

At this stage, 'The Man in the Sand' had yet to meet either of the Americans. His cover remained intact, helped no doubt by the fact that the media's focus was on the more romantic story of how Dubai Investment Capital, which had nearly bought Liverpool in 2007, was mounting another bid for the club.

 

Khorafi eventually became a human face to Gillett and his son Foster when they met at Harris's Chelsea home. At various stages, Khorafi was accompanied by Ahmad Al Omani, whose card described him as vice chairman and chief executive officer of the Qatar Consulting Company.

 

By then, lawyers for both parties were busy. Gillett supplied the shareholder agreement he had with Hicks as well as the credit agreement in respect of refinancing Liverpool had negotiated in January 2008. Gillett also provided details of salaries and management accounts, while Hicks supplied Liverpool's detailed 10-year financial forecast. Much of this is fairly standard information any buyer would need before committing himself.

 

All this helped Khorafi work out his price. He would pay £300m for the equity with an additional £100m depending on Liverpool's financial performance and make the club debt free - it is worth noting that when Hicks and Gillett bought Liverpool it had debts of £44.8m, but they had grown to £280m.

 

For Hicks and Gillett, the deal would mean a nice profit. They had paid £174.1m for their equity when they bought the Merseyside club in February 2007. It would also mean Gillett and Hicks would be released from their personal guarantees of around £190m.

 

It was critical for Liverpool to do the deal before the summer transfer window closed. By the first week of July, everything was ready. But then, two hours before the deal was due to be signed, Khorafi changed his mind, said he did not want to do a deal until September and walked away. No explanation was forthcoming and after that, it became impossible for Harris to contact Khorafi, eventually forcing him to seek the help of lawyers.

 

The postscript to this is that news of Khorafi's attempts to buy Liverpool finally emerged into the public arena last autumn. It prompted a statement of denial from the Al Khorafi group, although it came not from Rafed but from relative Jassem Al Khorafi, the speaker of the Kuwati parliament, and Jassem's elder brother Nasser, the group's top man. Rafed said nothing and it now looks like the classic non-denial denial.

 

When I rang Rafed Khorafi's lawyers, a spokesman said: "On behalf of our client we are going to decline to comment". When I asked if it would be possible to meet Rafed, I was told "we have tried that", the implication being it was a futile exercise.

 

'The Man in the Sand' had vanished and, but for the court case, would have left no footprints. Liverpool, riding high on the field, still await a buyer off it.

 

 

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