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FSG's next £60m move as long term plan becomes clear at Liverpool

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Should Liverpool City Council's planning committee give the thumbs up when they discuss the proposed expansion of Anfield next week then it will mark the next phase of Fenway Sports Group's plan.

The Liverpool owners, whose stock has never been lower among fans since their part in the doomed European Super League back in March, had faced calls from some in the wake of the collapse of the ESL project to sell up and move on, some fans tired of their perceived lack of investment in the on-field product at Anfield and their part in the failed coup by Europe's biggest clubs seen as a demonstration of their own self interest and lack of understanding of football fandom and its traditions on Merseyside.



Talk of a £3bn takeover from the Middle East surfaced, one that was reported to be rejected out of hand by FSG, while there has been much speculation on whether or not this would be the best time for the Reds' US owners to leave, whether they had simply gone beyond the point of no return and were left with no option.



For FSG, they are, as the ECHO understands it, committed to the longer term at Liverpool.



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The criticism over their reserved transfer spend and how the top brass are seen as somewhat aloof were there before the ESL plot came to light, but success on the field for Jurgen Klopp and his men in 2019 and 2020 gave some breathing space. Their part in the ESL farce, for which John W. Henry appeared before camera to take responsibility for, meant that there was fuel added to the fire, and at a time when their lack of investment on the pitch was hampering Klopp's efforts to deliver another season of success.

As it happened, Klopp and his patched up side managed to get over the line in third and nail down that oh-so-vital Champions League spot for next season when all hope had seemed lost after a wretched January for the Reds.

There is still anger and animosity towards FSG. But with regards to their business intentions for Liverpool, they are ploughing ahead, a clear demonstration that the next phase of what partners of the US firm are describing as 'FSG 3.0' has Liverpool as an important part moving forward. They are now, after all, the most valuable asset that FSG has in their portfolio, worth £2.8bn to become the 12th most valuable sporting team in the world, according to Forbes. That places them eight spots higher than FSG's other key asset, the Boston Red Sox baseball team.

The £60m expansion of the Anfield Road end would increase capacity at Anfield by 7,000 to 61,000. The application would also see the development of a new family fan zone, hospitality lounges and a range of other facilities as well as the granting of a five-year extension to their permit to hold up to six non-sporting events at the stadium during the year. The Reds had a temporary permit for that which was to expire this year and had hoped to have been able to get unlimited permission for non-sporting events at the stadium.

“The proposal seeks permanent permission for the use of the stadium for other team sports throughout the year," according to a Liverpool City Council document.

"This would allow for other sporting events, such as Gaelic Games or American football, to take place, typically during breaks in the football calendar. The club has advised that this would be estimated to be only around two to three times per year."

The opportunity to host such events is something that has been seen as a way to maximise the revenue potential of Anfield during the close season or periods during the campaign when the stadium is available for use.

When Tottenham Hotspur decided to spend £1bn on their new state-of-the-art stadium they did so believing that the potential for revenue generation would be able to underpin what they did on the pitch, making the club more able to compete each season on the field and less susceptible to the risks that present themselves in English football, such as missing out on the hugely lucrative Champions League.

The pandemic couldn't have arrived at a worse time for Spurs, the club barely a year into their residency and unable to achieve the considerable revenue that they had slated in for their contracted games with the NFL, for which Spurs had a retractable pitch specially designed, as well as the loss of music and sporting events such as Lady Gaga and Guns n' Roses concerts and an Anthony Joshua title defence. The latter three were due to bring in around £10m to Spurs while the NFL deal, which the London club have a 10-year contract signed, lost them £4m in rent rates, not including the millions more that are made through Spurs being able to keep the concession money and turning their club shop into a pop-up NFL merchandise mega store.

Bringing NFL games to Merseyside is something that FSG are keen to do, and they have the contacts to try and pull those kind of deals off.

Earlier this week RedBird Capital Partners, who own an 11 per cent stake in FSG, brought one of the NFL's key men on board with Kevin LaForce, the architect behind the $110bn 10-year NFL TV deal in the US, joining the firm as a managing director.

Those kind of links, as well as RedBird founder Gerry Cardinale and FSG chief Henry's own personal friendships with the likes of Dallas Cowboys owner Jerry Jones opens plenty of doors.

Gaelic football (GAA), hugely popular in Ireland, has also been suggested as having the potential to be played in an expanded Anfield, although, according to the Irish Examiner, no discussions have taken place between the GAA and Liverpool executives over the possibility.

FSG and the GAA have had dealings in the past.

The Boston Red Sox's Fenway Park stadium played host to the Fenway Hurling Classic in 2018, the US city seen as a perfect choice to take the sport to a more international audience owing to Boston's strong historical Irish connections, something that Liverpool also has in common.

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After the 2018 event, GAA president John Horan pointed to a future relationship between the two, saying: “Fenway Sports are very keen to keep this going and the critical thing from our point of view is that it is washing its face and it is not taking money away from any of the clubs or the development programmes we are carrying out."

All the above points to a longer term strategy for FSG at Liverpool.

While a £3bn offer for the club would represent quite the increase on the £300m that FSG, then NESV, paid for the Reds back in 2010, selling assets that they believe have the potential to grow to greater values still isn't part of their game plan.

The failed attempt with the ESL is seen by some as having the potential to see those valuations stagnate and then decline, with football having to look at itself and how it can operate in a more sustainable way post-Covid.

But the interest still increases in these clubs as brands globally, even during a pandemic. And while there may be some reluctance from commercial partners right now to engage in longer deals, there is some expectation that sponsorship values will only grow higher once football gets back to normality and society opens up fully once more.

"It will come back stronger than before the crisis. I would expect in the post-Covid world, the amount of money being spent on sponsorship with football clubs will be larger than it was before the crisis and will be growing faster," said Mike Wragg, global head of consulting and research at global analytics company Nielsen Sports, speaking to offthepitch.com.

"In the very short-term Covid has obviously shut down a huge amount of valuable marketing inventory and impaired the ability of some sponsorship buyers to pay for what they need.

"But we know that the demand for it is still getting greater, as there isn’t an alternative way that people are finding that type of communication.

"In fact brands need it more than ever given the urgent need they have to reposition how they communicate, and adapt to how the world has changed.

"I think it’s going to be a very strong bounce back when it comes."

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Then there is the significant £528m investment from RedBird to take into account. That deal, which will seek to utilise the knowledge and expertise of Cardinale in the media and broadcast rights ownership space, offers potential growth when new media revenue streams arise, with clubs seeking to have greater ownership over their own broadcast rights.

The Anfield Road expansion is the first block to be placed down after the ESL saga, and after the intense backlash that FSG faced for their completely misguided and tin-eared part of it all.

The only way that FSG will provide the kind of transfer kitty that fans would really like to see Klopp afforded is if the club is able to generate those kind of funds themselves. It still likely won't be enough to compete with likes of Manchester City and Chelsea, but as long as Liverpool continues to show huge potential for growth as a business there is little requirement for FSG to sell up and move on.

But they will know that their greatest success was being able to leverage success. The two go hand in hand, and if FSG want to continue on their journey they will have to pay attention to both. After all that has gone on, they have no room for error anymore. They have used their quota of 'sorry'.


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