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Liverpool Echo
Liverpool Echo
Dave Powell

FSG insiders have hinted at two long-term targets that will impact Liverpool sale

When Liverpool chairman Tom Werner spoke to the Boston Globe outside the Major League Baseball owners meeting in New York back in October he was quizzed on what kind of timeframe there could be on a Reds sale.

Earlier in the month Fenway Sports Group had been revealed to be ready to listen to offers for the Reds, with a valuation of $4bn (£3.3bn) likely to see only offers above and beyond considered.

But FSG weren't set on selling, as their statement suggested in early November, with the Liverpool owners also seeking a partial sale of the club and realising some new capital by welcoming in minority partners. US investment banking giants Morgan Stanley and Goldman Sachs had both been engaged for some time to aid the process of outside investment, with ECHO sources in the US having stated that a 'strategic partner' would be the preferred outcome, one who could bring both capital and expertise and who, potentially, could accrete their stake over time to take the mantle from FSG.

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Either way, one thing was clear from FSG's point of view; there was little appetite to expedite the sale of the Reds.

Werner told the Globe in November: "We’re exploring a sale, but there’s no urgency, no time frame for us, and as far as I’m concerned, it’s business as usual."

The ECHO has been told that while there has been interest there has been "nothing real" that has warranted real progression and that FSG supremo and Liverpool principal owner John W. Henry was leaning towards keeping control of the club as long as the right investment and partner moving forward could be found.

There has been the suggestion that the value placed on Liverpool and the likely cost of getting hold of an NBA expansion franchise, with FSG wanting one in Las Vegas, being similar speaks to the Reds being something of a makeweight when it came to realising the funds needed to acquire a new team, which FSG partner and basketball icon LeBron James is expected to helm.

There has also been the suggestion that a play for the NFL was on the cards for FSG, with links made to the Washington Commanders team placed up for sale late last year by owner Dan Snyder.

In the case of any NBA or NFL aspirations for FSG, there is nothing that is coming down the tracks imminently that would require them to release huge amounts of capital to move on to another target.

NBA expansion from 30 to 32 teams has been on the agenda for years. It is edging closer but commissioner Adam Silver has repeatedly attempted to pour cold water on any hopes that it was imminent. Silver has said that expansion is "inevitable", and cities such as Seattle, Vegas and Mexico City have been mooted as potential destinations for franchises. But there is nothing that will happen swiftly with the NBA to have to box off a new collective bargaining agreement with the players, as well as secure the next cycle of media rights before focusing on expansion, which would then have to be voted through by other team owners given that they would have to share more of the pie moving forward. The expansion cost, expected to be around $4bn given the valuation of the Phoenix Suns sale recently, would be spread around the teams as a sweetener.

Also, given that James, 38, wants to continue his playing career long enough to play with his son Bronny, who is eligible for the NBA next year, means that the timing of expansion in a couple of years time would sit better with their overall plans.

James told ESPN on Sunday: "I need to be on the floor with my boy. I gotta be on the floor with Bronny.

"I would love to do the whole Ken Griffey Sr.-Jr. thing. That would be ideal, for sure. Being with him, spending a full year with him in the same uniform, that would be the icing on the cake."

With regards to the NFL, that's also not something that is on the horizon any time soon for FSG, although it would be a market that they would undoubtedly have an interest given how it dominates the North American sporting agenda.

The FSG links to the Commanders were erroneous in that it was a play that simply couldn't happen due to the rules that the NFL have around private equity as part of ownership groups. Private equity and other forms of institutional capital is not allowed in the NFL and FSG have several private equity partners, most notably RedBird Capital Partners and Arctos Sports Partners.

Henry and other members of FSG could form part of an NFL bid privately, but given the cost to get involved, with most franchises north of $5bn, and that FSG are in 'growth mode' and would like a team of their own in the league one day, that isn't something that is expected to come to pass. The Commanders have held their first round of bidding and names such as Amazon founder Jeff Bezos have been heavily linked.

There has been talk for some time of the NFL relaxing its stance on private equity arriving into the league, but RedBird founder and managing partner Gerry Cardinale, whose firm owns 11 per cent of FSG and also acquired the rights to the spring football league in America, the XFL, with actor Dwayne Johnson, doesn't see it being a development that happens any time soon.

Speaking at Axios conference, Cardinale said: "The opportunity to buy an NFL team is so limited, I think it's fine. I don't think you need to change the rules. I think the NFL is in a class by itself. They're not going to have their hands forced to change the rules."

There is no urgency for FSG to have to get their house in order to get their hands on a new team, it is a process that will likely be arrived at over the next two years or so, and one that will be determined by the NBA's own timescale.

The lack of a need to sell, or indeed a huge desire to sell, Liverpool means that there is an ease around the search for investment in the Reds and them being open to offers for their full shareholding. It has been coined as being exploratory, which is the case.

While the news cycle in European football, particularly in the Premier League, is fast paced and relentless, ensuring some kind of swift sale of the club is not on the agenda in Boston. It will be a decision determined by the interest that arrives and potentially how long some of their other growth ambitions take to play out.


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