Liverpool must repay £31.5 million to banking institutions in little more than a year or risk having to sell Fernando Torres and Ryan Babel.
The Times has learnt that Liverpool borrowed the money to sign Torres, the Spain forward who has scored 30 goals this season and has already become a firm favourite on the Kop, from Atlético Madrid last summer. The club then refinanced that debt on January 25, at the same time as they secured a £350 million refinancing package.
Liverpool entered into an 18-month loan agreement with interest of 9 per cent — £2.8 million a year — with a letter of credit to pay back the £31.5 million at the end of the period.
Should Liverpool be unable to pay back or refinance the loan, banks could force the sale of Torres and Babel, who was also included in the smaller refinancing package.
It is unusual for Barclays Premier League clubs to buy players in this way. Deals are normally funded using television income. Liverpool have to pay £30 million a year in interest payments on the £350 million loan, the terms of which end in July 2009. There was no official comment from the club last...