SAVE LFC MAGAZINE
GOOGLE IS OUR FRIEND By No666
What exactly would David Moores have discovered had he googled ‘Tom Hicks’ back in 2007? Former LFC owner David Moores has let it be known
can change his spots, as the well-known saying
in a recent letter to The Times that he resents the
goes…
accusation that a quick Google search would have uncovered a few outstanding bills and bankruptcies
GEORGE DUBYA AND A VERY PRIVATE INVESTMENT Hicks didn’t get where he was without oiling some
in Hicks and Gillett’s dusty cupboard and that he
juicy contacts along the way, Parry learns. But his
was remiss in handing custody of our club to the
brow furrows as he reads this 2002 article in The
duo. He wrote, ‘The simple truth is we went way
New York Times detailing how George Bush and
beyond Google in our check-ups.’ Rothschild – ‘one
a syndicate of owners had sold the Texas Rangers
of the most respected names in global finance’
baseball team for triple the price they had paid.
– vouched for both of them, Moores revealed: Rothschild being the firm that was representing… Hicks and Gillett. But with a day’s subscription to an electronic newspaper cuttings’ library costing around £20 back then, what would he have uncovered had he and Rick Parry done some cursory research into their new buddies? Enough to have made them hit the pause button, we contend, as we whizz back to the scene in the fans’ time-travelling regret-mobile. TOM HICKS: GREED IS GOOD As Rick Parry manoeuvres his mouse over the
screen, a carefree – almost clown-like – grin spreads over his face as he learns that Hicks began his career on Wall Street in the 70s and had early success with his own private equity business. But then he freezes: in the early 80s Hicks nearly went bust, spending four years battling through the courts with a former partner. In the later 80s, he was one of the leveraged buyout stars of the greedis-good decade. However, by 2000, his privateequity firm had borrowed increasing amounts. When it hit problems, the need to repay big loans from commercial banks sent it scrambling for cash. He jumped on the Internet merry-go-round in 1999 and ended up badly bruised. He then swore he would return to the ruthless lbo model he knew best. Hmm. But still, Parry tells himself, a leopard 12 SAVE LFC MAGAZINE—August 2010
‘The price-is-no-object buyer was a deal maker named Tom Hicks. And thereby hangs a tale… ‘The University of Texas, though a state institution, has a large endowment. As governor, Mr. Bush changed the rules governing that endowment, eliminating the requirements to disclose “all details concerning the investments made and income realized,” and to have “a well-recognized performance measurement service” assess investment results. That is, government officials no longer had to tell the public what they were doing with public money, or allow an independent performance assessment. Then Mr. Bush “privatized” (his term) $9 billion in university assets, transferring them to a non-profit corporation known as Utimco that could make investment decisions behind closed doors. ‘In effect, the money was put under the control of Utimco’s chairman: Tom Hicks. Under his direction, at least $450 million was invested in private funds managed by Mr. Hicks’s business associates and major Republican Party donors. The managers of such funds earn big fees. Due to Mr. Bush’s change in the rules, these investments were hidden from public view; an employee of Utimco who alerted university auditors was summarily fired. Even now, it’s hard to find out how these investments turned
out, though they seem to have done quite badly. ‘Eventually Mr. Hicks’s investment style created a public furore, and he did not seek to retain his position at Utimco when his term expired in 1999.’ HICKS IN BRITAIN Uh oh. ‘Does Hicks has a record for doing what is
best – for Tom Hicks – ignoring any wider moral issues or responsibilities?’ Parry asks himself. Hicks was once chairman of Viasystems Group Inc, the parent company of a Tyneside electronics firm which made 1,000 locals redundant in 2001
America, PSN, acquired national
basketball
association
rights,
formula one races and soccer championships at overblown prices. Hicks
invested
about five hundred million dollars and in only two years filed for bankruptcy.’
without paying them redundancy worth an average
A
of £27,000 each. Because Hicks’s parent company
told The Mirror, ‘The
cut all ties to the Tyneside subsidiary just before it
Americans…did not
went under, it was not liable for any of its debts.
understand the way
Cash to compensate workers came from the British
football works. The way
government, as had regional assistance when the
they did things was very
firm opened. In short, the British taxpayer paid for
American, in the crudest
Hicks’s failed venture.
sense. The model they wanted d o e s
SPORTING HICKS: “I’VE DONE THINGS ABOUT RIGHT FOR ME” Tapping in the words ‘Hicks’ and ‘sports,’ Parry
not function here.’
learns that Hicks has previously owned a football team. ‘This should be illuminating,’ he tells himself. In 1999, Hicks’s firm bought into Brazilian giants Corinthians, promising a state-of-the-art stadium. Parry’s pulse quickens. Early on, signs were encouraging – the signing of Brazil internationals Dida and Luizao, for example. But the following summer, the Americans began selling off star names, and pulled out of the club in 2003 after a row with a local partner over funding. South American journalist Ezequiel Moores summarised how, ‘Hicks took over two teams, Corinthians and Cruzeiro, through contracts that should have run until the year two thousand and ten. ‘These deals included promises of construction of new stadiums. Hicks also bought forty nine percent of the traffic television network and dreamed up its own ultimate soccer business: Hicks teams facing each other in matches broadcast, naturally, by Hicks. Hicks set up a cable channel in Latin
Brazilian
source
But what about baseball? Parry can scarcely bring himself to read a 2004 edition of the Chicago Sun-Times which facetiously awarded Hicks ‘the annual Tom Hicks award for incompetence by a baseball owner,’ after three years of last-place finishes. In his own backyard the Ford Worth StarTelegram declared, ‘A guy like Hicks doesn’t seem to understand Rule No. 1 of sports ownership.’ A few years later, the Dallas Morning News was summarising what almost a decade of Hicks’s ownership had meant to the Rangers. They pointed out that he had been lauded as being the big spender the team needed to catch up with the two teams dominating the sport nationally, then ridiculed as a cheapskate, that the team had showed early promise but declined into mediocrity and failure. ‘He fired the most successful general manager in the club’s history and replaced him with the most reviled.’ Any regrets? ‘I think I’ve done things about right for me,’ Hicks was quoted as saying.