Liverpool’s owners remain on the lookout for new opportunities but Reds remain vital part.
The stance from Liverpool owners Fenway Sports Group is that the Reds remain a key part of their business now and into the future.
While the door was kicked open briefly to a full sale of the club back in November, the position quickly pivoted to one where selling equity in the club was the preferred option via a minority partner. That is a process that FSG still has on their agenda, but one that hasn’t moved on much from where it was earlier in the year.
FSG are, by their own admission, in ‘growth mode’. Alongside its companies such as the NESN cable network, Fenway Sports Group Management and FSG Real Estate, the firm has a sporting portfolio of Liverpool, the Boston Red Sox (MLB), the Pittsburgh Penguins (NHL) and RFK Racing (NASCAR).
With the NBA considering expansion from 30 to 32 teams, and FSG interested in acquiring a franchise in Las Vegas with FSG partner and basketball icon LeBron James at the helm when it does come up for grabs, there are future plans. But in terms of the erroneous narrative that existed that the sale of a slice of Liverpool was to raise capital for another venture, there are currently no plans to move on the acquisition of another team or venue, with the sale of assets also not under consideration.
“We are in a business of long-term value creation for our partnership, not a quarter by quarter cash flow projection,” FSG partner and Red Sox CEO told Bloomberg’s Chief Future Officer show, which profiled FSG chief financial officer Julie Swinehart.
“Part of Fenway Sports Group’s secret sauce is investing in blue chip assets that our fans care passionately about so that we can win, but also invest in their venues. The beauty of Fenway Sports Group is that we feel that we can do it all.
“As long as the growth opportunities fit our overarching criteria which are blue chip in nature, great opportunities to either restore, rebuild or enhance a venue that might need some TLC, and we feel that the Fenway Sports Group can be additive and add more value, then it’s something we’ll look at.
“These clubs need massive investment. Do we try to be disciplined? Yes, of course. We need to spend on the player development area, on free agents, or transfers when it comes to global football.
“We started looking at Liverpool in August of 2010. An email was sent from a passionate LFC supporter who worked in our sponsorship department. Three months later we owned the club. While there is no strategic plan to acquire a new team or venue, things can happen rapidly around here.”
Swinehart, who became FSG’s first ever parent company CFO when she joined the business last year, has oversight over the financial performance of all the teams and businesses that make up the $10bn-plus valued FSG portfolio. She also has a significant role to play when it comes to mergers and acquisitions, sitting on a team that makes recommendations to FSG principal John Henry, chairman Tom Werner and president Mike Gordon.
Swinehart, speaking to Bloomberg, said: “I try to assess what’s working and what’s not working, where we can improve value there, but I do it in a way that starts with relationship building.
“We have distinct management teams through each entity. The Boston Red Sox have a CEO and CFO, Liverpool has a CEO and CFO, and those folks are offered a fair bit of autonomy and decision making authority. Part of my role is to make sure we continue to maintain access to capital, keep our cost of capital as low as it can be, fortify the balance sheet so that we can seek out that new team in an existing league or perhaps dive into a new venture in a new sport. We are in growth mode.
“When it comes to M&A (mergers and acquisitions) we have a five-person committee that takes ideas that come from our chief strategy officer and his team. The five of us digest it and analyse it. There are times when I am playing devil’s advocate just to make sure that we’re not getting too excited or too emotional about an idea. The group of five then vote and, ultimately, that information is provided to ownership, so John Henry, Tom Werner and Mike Gordon are the ultimate decision makers when it comes to new investments.”
