Kraft and Liverpool?

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Liverpool FC in £100m talks with L4
By David Owen and William Hall, The Financial Times
Published: December 2 2004 02:00 | Last updated: December 2 2004 02:00

http://news.ft.com/cms/s/0dfd6e7c-4409-11d9-a5eb-00000e2511c8.html

The Magpie

 

Any thoughts as to the Kraft's motivation here?

 

First Foxboro Stadium, and then The Razor. Now, Anfield?

Go Bobby!!!

If the Krafts want it, it'll happen. No lie.

http://www.koptalk.org/archive/editor/021204.shtml

 

... assuming the story's correct? Well, diversification of assets perhaps. Liverpool is one of the more financially sound (relatively-speaking) Premiership clubs of late, and is one of handful of Premiership clubs who have recently been able to turn a pre-tax profit. They're also trying to get a big (55-60,000 seats) new stadium financed and built for the club (something Aston Villa's been considering for some time as well), and that's certainly something Kraft has experience with. You can see one artist's rendering below:



The reports about Jefferies (who was born in Merseyside) began to surface in mid-September, but were written off by many, this as the potential bid back then noly seemed to involve the filmmaker and a second partner. If they've since managed to organize a consortium, it will be interesting to see where things lead, if anywhere.

The Magpie

 

Dragging the economists back in, isn't the weak dollar a strong disincentive for this kind of deal? Seems like this is a time when other countries start buying up us, not the other way around.

OTOH, Malcom Glazer's been into PL investing for a while now, maybe he and Kraft have been discussing the merits at NFL get-togethers?

 

well relating this to another thread about the S.S.S. , if the krafties do take over liverpool and get a lot of profit, the revs have a higher chance of getting their own stadium to play in.

long shot, but technically possible.

 

You know, it's interesting to see that, not only are a large number of U.K. press sources picking up on this story, but almost all are including the following:

"The L4 group is believed to be the Kraft Family, which owns Superbowl champions New England Patriots and the New England Revolution soccer franchise, currently coached by former Reds player Steve Nicol..."

However slightly, and albeit indirectly, the profile of the Revolution is getting raised a bit through this.

The Magpie

 

Conspicuously absent from the Beeb's report, though.

 

Big Frank where are you? The irony in this is rich indeed.

 

The "Anfield Reds" as a subsidiary of "Soccer Smiles, Inc."......yikes.....

 

More at http://msn.foxsports.com/story/3212292

 

Very Interesting. Good to hear that the Krafts are considering branching out into the wider soccer community. One thing for sure the Krafts are very prudent business people and they know how to make money and if they are in this one for real will find a way of making Liverpool profitable again. This one should be fun to watch as it developes. Somehow I don't see a Kraft backed group pulling a "Chelsea" and buying their way to the top.

 

What do the Krafts know about running a profitable soccer franchise?

 

I don't know if they do but if their management of the NE Partiots and the awards they have received as Business Sportsmen of the Year are any indication they sure do know how to make a franchise profitable and should be able to do so with Liverpool.

It's easy to question their skills at managing a soccer franchise when one looks at how MLS has done in it's first 9 years. I do think however that there is a huge difference between what constitutes success on a start-up league like MLS and a storied side like Liverpool.

Given the opportunity I would be glad to buy shares of stock in Kraft Enterprises--the man knows how to turn a profit

 

There is also the fringe sport/big sport thing. Running the Revs is a lot closer to owning a hockey team in England than it is to owning Liverpool.

To accomplish in the Premier League what Kraft has accomplished with the Patriots you'd probably have to turn a team like Sheffield Wednesday into a European power. The last time Liverpool even remotely resembled the pre-Kraft Patriots, they didn't even exist yet.

 

I wouldn't hold my breath. If this asset were capable of producing profits in the short term, then they probably wouldn't be up for sale. I'm sure any investment the Krafts would consider would be looking at profitability (or more likely, increase in asset value) down the road.

If Liverpool is worth 200 Mpounds and Manchester is worth 500+ Mpounds, that's quite a gap. Kraft saw something similiar when he bought the Patriots and now has closed the gap between the most valuable NFL franchises significantly.

I suspect that what he brings to the table is the ability to market the team in the US, and around the world. Man U. has already shown how to do it and Kraft should be well positioned to do it in the US. The Irish are huge Liverpool fans, and there are more Irish in the US than in Ireland!

 

Either that, or a team in NFL Europe, but great comparison none-the-less.

The Magpie

 

If the Krafts own the teams and SN of Liverpool fame is still in the equation speaking for the Revs interests/needs I'm willing to bet we will see a variety of enchanges. What type of exchanges we might see is fun to conjecture. I do think Chivas has opened up new ground in MLS and the Revs may just back into a position to pull off similar player loans. Yes, I know there is a significant difference in the level of skill and play between the two clubs but it's not beyond reason that we might see some loan deals. Fun idea to contemplate.

 

Just like they have marketed the Revolution!

 

But certainly beyond reality unless you are talking loans of a financial kind.

Dream on, and be happy.

 

I'm not sure there wouldn't be some sort of marketing connection. I'm sure Liverpool would like as much as any Euro club to increase their profile in what could be a growth market, and while doing so, why not scratch your own back?

Of course, that has nothing to do with the reason he's doing it. The reason is probably something like what real estate people refer to as 'flipping.' You take a house with potential, take a do-it-yourself approach to fixing it up, and then if you sell it, you do so at great profit. That's essentially what happened with the Pats.

And Liverpool FC has potential. They're not in great debt, they're not losing money now, and they have tradition. You give them the right stadium to play in, increase their profile abroad (including maybe here), and you might have yourself a major Euro power, both on the field and in the finances. For 100million Pounds, that could be one of the best buys around, if that turns out to be the price.

 

Something else to think about: With Kraft being on the board of directors for the U.S. Soccer Federation, I would think that part(although a small part) of the reason for this move would be to raise the profile of U.S. soccer in Europe. Perhaps we will see an increase of US player transfers to European teams(well, Liverpool at least).

Also, transfer fees for top US players are only in the low single digit millions... maybe Kraft is thinking of capitalizing on this. I mean, it's less risky to take a chance on $1-$2 million up & coming top US player than, say, $15-$20 million on a more established player.


First Glazer, now Kraft.
Oh heck... the Eurosnob's worst nightmares are coming thru!

 

To be honest, I think we're getting a bit ahead of ourselves when we start talking player exchanges, reciprocal agreements... using Liverpool as a means of "raising the profile of U.S. Soccer," etc.

The club has a rich history, an impassioned and dedicated group of supporters, is competitive, already has world-wide "brand recognition," and that can only be enhanced through an infusion of cash and better top-down management... and Liverpool's currently in a position where someone like Kraft can step in and make a difference. Yes, there is some measure of debt, and there are the concerns specific to their stadium plans... but Kraft's been down this road before, and is probably better equiped than most to tackle the situation head-on.

If the going price is 100 million pounds, and considering the turmoil in the club's efforts to secure a new source of funding and investors, Kraft would be a good choice, especially if their commitment were long-term.

The Magpie