RBS moves to force George Gillett and Tom Hicks to sell Liverpool

Tom Hicks and George Gillett's ill-starred reign as owners of Liverpool looks like having less than a month to run after the club's loans with Royal Bank of Scotland were placed into its toxic-assets division.

The deadline for the refinancing of the owners' personal loans from RBS is 6 October, and that now looks set to be the date that Hicks and Gillett's association with England's most successful club will end. The bank's decision to switch the debts to its Global Restructuring Group is the strongest possible signal that these loans will not be extended.

The co-owners' previous attempt to refinance the debts in June, when they are believed to have offered to secure the loans against their US assets, was overruled by the club's board, led by the chairman, Martin Broughton. Now, with the loans having been shifted into RBS's so-called "bad bank", where all toxic assets have been housed since last year, it is clear the club's lender has also adopted a more steely stance towards the Americans.

According to the club's accounts to July 2009 Liverpool's owners owe £237.4m to RBS. Through a variety of companies in the UK and overseas, Hicks and Gillett are also personally exposed to tens of millions of pounds in other commitments to the club and its lender. These have been in the form of a mixture of cash, which the pair have injected through equity, and guarantees to the RBS loans. Last year's accounts stated this combination amounted to £145.3m, although it is believed to have risen dramatically after the last refinancing agreed five months ago.

RBS would hope to achieve an orderly sale without having to take control of Liverpool. However, depending on the terms of the April refinancing agreement – which have never been made public – that may prove difficult if the co-owners, who value the club at £800m, refuse to go quietly.



There are strong signs RBS will now be prepared to accept a knockdown price in order to cut its ties. During negotiations with prospective buyers Broughton, and the investment bank advising him, Barclays Capital, have maintained that Liverpool's debts with RBS must be paid in full as a minimum sale price.