DIC bid for Liverpool still possible despite deadlock

George Gillett's representatives remained in Britain yesterday despite their failure to hit the deadline for a deal in which he would sell his stake in Liverpool for around a £40m profit plus add-ons, and the prospect of a sale remains alive.

Dubai International Capital (DIC) had set a deadline of midnight on Tuesday for the American to agree an increased offer for his 50 per cent share of the club and though it passed without progress, the atmosphere during the late-night negotiations was described yesterday as "very professional and amicable" by a source who was present at the meeting and who said the chances of a deal being struck remain "on a knife-edge".

Despite the breakdown of talks, the "gap in valuations" of the club between Gillett and DIC does not make negotiations irredeemable from here, according to the source. "The gap is not a huge one and it may be the parties can talk creatively, but then again it may be that this is the end of it," said the source.

The sense emerging from the negotiations is that Gillett is close to resolving issues with DIC, unlike co-owner Tom Hicks whose valuation was described by DIC chief executive Sameer al-Ansari earlier this week as "in dreamland". It is thought Gillett's staff may remain in the UK for another day or two.

Gillett was unable to attend the negotiations in person as he is recovering from illness at his home in Colorado, but he was in constant phone contact with all parties during the negotiations at a London hotel on Tuesday. The failure to hit DIC's deadline creates a number of uncertainties about the prospect of DIC buying out Hicks.

The first of them is whether Tuesday's deadline – an arbitrary one imposed to deliver some focus to negotiations and prevent Gillett and Hicks giving DIC the run-around – will be adhered to and DIC will now walk away. "If you publicise a deadline and then retreat from it would defeat the object of imposing it," one source said yesterday.

There is also genuine uncertainty about whether Hicks might block any sale by Gillett through pre-emption rights, under which shares must be offered to him first. Though Hicks has declared that he will not allow Gillett to sell, it was not presented as a potential major stumbling block at Tuesday's talks and it is thought that Hicks would have no control over matters if he cannot raise the finance to buy out his business partner.