Why Broughton has a point on this ownership issue

Liverpool Chairman Martin Broughton has said that he believes it was preferable to find a buyer who would focus on a “rational commercial approach” rather than a Sugar Daddy like Roman Abramovich or Sheikh Mansour.

“We weren’t looking for an Abramovich or Sheikh Mansour, because we understand a rational commercial approach is the way forward in football now. New England’s bid of around £300m will include £200m in equity to write down the acquisition debt, as we call it, the legacy of Hicks and Gillett, and there is £40m of cash to pay off various other liabilities. A hugely important aspect for Liverpool is [Uefa’s] financial fair play rules. They come into effect pretty damn soon, and will have a massive effect on many, many clubs. I couldn’t help notice that Manchester City’s wage bill for last year was exceeding its revenue. That is going to be very difficult under financial fair play. We were looking for somebody who was going to see this as a commercial business that can be commercially successful.”

Broughton’s argument against such owners is a pretty interesting one if we take into account the new financial play rules being enforced by UEFA. It will require clubs to break even over a continuous three-year period if they want to play in European competitions. As Broughton mentions, teams such as Chelsea and Manchester City would fall foul of these measures if enforced now. The Reds chairman has obviously considered these new rules very seriously while looking into potential new owners. New England Sports Ventures certainly fit the ticket if we are looking for an owner who takes a commercial approach. The massive fan base of the Boston Red Sox has allowed NESV to push the Baseball team to second behind the New York Yankees in turnover for MLB sides. It is obviously something they will want them to replicate if they takeover at Anfield where the Reds have a massive worldwide fan base.

The UEFA rules state that clubs will only be allowed losses of €45m between 2012-2015, and this will be reduced to €30m for the next three years after that. The figures will be reduced even further after those years to encourage clubs to spend wisely. As Martin Broughton said about Manchester City; wage bills exceeding revenues will be a thing of the past. In effect, spending as wildly as Manchester City and Chelsea have done over the past decade will also be a thing of the past if they want to play in the Champions League and Europa League.

Of course, it will mean that Liverpool will not probably ever have the spending power of Manchester City, Real Madrid, Barcelona or Chelsea, but if the deal with NESV is as Broughton says it is, it means the long term future of Liverpool Football Club is secure. Sugar Daddies such as Sheikh Mansour and Roman Abramovich could withdraw their funding at any time, and leave their respective clubs in massive financial difficulty. With American owners hopefully focused on making Liverpool profitable in its own right, it makes the Merseyside club self-sustainable and less reliant on hand outs.

John W Henry and NESV have stated that winning on the pitch and being commercially successful off it go hand in hand, let’s hope that this rhetoric holds true so as the club becomes more profitable off the pitch, it provides funds for transfers to improve fortunes on the pitch.

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