Liverpool ready to spend after signing £80m sponsorship deal

Liverpool are ready to finally fulfill their commercial potential, and become the biggest team in the world.

That was the claim from new managing director Christian Purslow on Monday night, as he unveiled the largest sponsorship deal in British football history.

The Anfield club have a signed a four-year, £80million agreement with London-based investment bank Standard Chartered, who are one of the biggest financial institutions in the emerging markets of the Middle East, Asia and Africa.

The deal outstrips even Manchester United's new tie up with American based Aon Corporation, and Purslow believes it offers a message of intent to the club's supporters, that Liverpool intend to strive for the summit of world football.

Crucially, that will mean manager Rafa Benitez is offered the funds required to build a team capable of competing at the very top, with life-long fan Purslow insisting that all profits will be reinvested in the club, and not diverted towards Anfield's American owners.

"This is a statement of intent about our desire to improve and invest in our football team - we want to be the best in the world, and that is what we are about," Purslow explained.

"I want us to be the best football team in the world and there is a pretty clear link between being the best team and having the best performance off the field. That has not been our position, historically, but there is no reason why, going forward we cannot be the biggest, best-run and most commercially successful football club in the world.

"The fans will be right to ask where the money will go from this deal, and they'll be pleased and relieved to know that Liverpool's revenues, profits and income is the club's. 

"It stays in the club, it doesn't go out of the club, it's job is to support our football team and so I can assure you, as we drive forward our turnover, we will invest a sensible element of that in our wage bill and we will invest a sensible level of our profits in our transfers and none of those monies go anywhere other than into the development of the club."

Many fans have questioned whether the debts incurred by American owners Tom Hicks and George Gillett in their initial purchase of Liverpool are too large to sustain in the long term.

Some have complained that Benitez wasn't given sufficient funds to invest in the transfer market in the summer, but the managing director was at pains to point out yesterday that the deal with Standard Chartered - which will commence in the summer of 2010 - was part of a long term plan to transform the club and ensure rigorous investment in the team.

And he insisted the debts are far smaller than is widely believed, and will not prevent the funds from the new sponsorship deal being used to buy new players.

"Our ability to support Rafa in terms of the playing squad will be hugely enhanced next year because of this deal," Purslow explained.

"The perception that Liverpool is massively in debt is not accurate. Liverpool has substantially lower debts than are often reported, and relative to our profits are perfectly manageable. That is not to say they won’t be reducing over time and that is a key plank of my strategy for this football club.

"Our profit before interest and tax last year - EBITDA – which means our cashflow, was £44 million. That’s the one that everyone cares about, and it shows we are a well run organisation that is growing and growing fast.

"You drive your revenues forward and a well-run organisation will run a wage bill that's a sensible proportion of those revenues, you'll try to generate profits and those profits will be used to invest in the future of the football club, which, in football speak, often means buying players."

Liverpool haven't always exploited their vast commercial potential in the past, which has seen them lag behind Chelsea, Manchester United, Manchester City and even Arsenal in their ability to buy - and pay - top players.

But Purslow believes that the deal with Standard Chartered will help attract investment into the club, and also generate the confidence that will allow Liverpool to build their new stadium and expand revenues further.

"Believe you me, multi-million dollar financial institutions don’t put their name with you unless they are really comfortable there is a strong future on and off the park," he said.

"We are growing fast, but there's no doubt about it, when we have a new stadium, that will be the biggest single quantum leap forward in commercial revenue and income that I can see ahead of me as we develop a strategic plan.

"It remains a key plank of my strategy for the football club and when the project finance market reopens, when we can secure sensible and affordable funding for that, that I feel is right for our club and doesn't burden the club unnecessarily, then we'll do the stadium. 

"Having a healthy football club makes those sources of finance much more comfortable about financing a stadium."