Reports have surfaced suggesting that Liverpool co-owner George Gillett may be in a spot of bother. It appears that he took out a loan from a little known finance house in Delaware in order to meet RBS’ and Wachovia’s demands for cash security last January.
Crucially, the £75m loan uses his holding in Liverpool as collateral, meaning that he could possibly lose part or all of that holding should should he default on the loan or be unable to refinance. The finance house, Mill Financial, has decided to sell the debt and there is reportedly one expression of interest.
It’s unclear what kind of charge Mill Financial has over Gillett’s shareholding and how this ranks alongside RBS’ and Wachovia’s charges.
It was alleged at the time of the refinancing that a large factor behind the delays was Gillett’s inability to put up his share of the security. This news appears to back up those claims, with the huge 19% interest rate taking the debt into ‘junk bond’ territory.
Gillett has already declared personal bankruptcy once in the past (something we’ll hopefully be able to cover in more detail soon).
Gillett trying to refinance debt – Sports Business Journal
Habs could feel ripple effects of owners loan – Globe and Mail
