Bloomberg is reporting just how little interest European banks have in owning the Liverpool Football Club, striking a deal with Tom Hicks:
The U.S. private equity executive, who bought the northern English soccer team in 2007 with fellow citizen George Gillett Jr., agreed in July to repay a fifth of its 290 million-pound ($478 million) debt in return for Royal Bank of Scotland Group Plc and Wachovia Corp. refinancing the rest of the loan.
They note that U.S. lenders to the Texas Rangers haven’t been quite so kind to Hicks, having declared him in default because of missed interest payments. And I found this astounding:
Companies have more debt, and are paying less in interest, than they did in the recession of the early 1990s, according to Jon Moulton, the founder of private equity firm Alchemy Partners LLP. A firm that had debt of more than four times its earnings before interest, taxes, depreciation and amortization in 1992 would now have debt of 10 times Ebitda, Moulton said. It would have paid 12 percent interest on that debt in 1992, compared with 3.8 percent to 5.3 percent today, he added.
Money really did get too cheap?
