Tycoon fans plot Everton bid
Local businessmen in line to step in if 777 takeover fails Dyche fears no deal would mean having to sell players
Two millionaire Evertonian businessmen and American firm MSP Sports Capital will be targeted as potential buyers if Farhad Moshiri axes his deal with 777 Partners.
Dealmakers believe Liverpudlian investors Andy Bell and George Downing, who already have money tied up in the club, would be seriously interested in at least part-ownership. The pair could be approached to form a consortium with MSP, one insider suggested, as the chances diminish of Miamibased 777 assuming control.
Last night, the club’s manager, Sean Dyche, laid bare grim prospects facing his team if no deal was finalised this summer, saying he could be left “juggling dust”. He even raised the nightmare prospect of having to sell one of his most valuable assets to generate funds.
“If a takeover doesn’t happen then it will probably be juggling dust, not sand,” Dyche said, putting rival clubs on alert for the likes of in-demand Jarrad Branthwaite.
Bell and Downing’s potential interest came to light after the financial news service Bloomberg reported MSP, one of the leading lenders for the club’s new stadium, was pondering investment options for the second time in a year.
Moshiri’s initial agreement to sell his 94.1 per cent stake to 777 last September had materialised after an alternative minority investment deal with MSP collapsed.
MSP, in partnership with Bell and Downing, has £160million debt remaining in the club after a prior loan was agreed, however. It was a condition in the Premier League approval process that 777 must clear that amount before completing the purchase – but payment is now overdue.
With Moshiri seriously considering pulling the plug on 777’s protracted takeover, Dyche expressed concern at further delays.
“If there is no takeover of any kind and it stays as it is now, then we have to self-generate,” he said. “And if you self-generate it is a very tough situation because usually you sell high and you buy low. But when you buy low, who are you buying? And if you can’t buy then you have to generate from inside and that is a time thing. There are not many young players who are ‘right, we are ready for the Premier League’.”
Bell had more than £74.1billion in client assets when he stepped back from his financial online platform firm, AJ Bell, in 2022. Downing is a property magnate, who founded Downing Construction. The pair have been business allies for years.
With outstanding debt and other loans now soaring beyond £1billion, Everton come with a health warning for potential buyers.
However, as Farhad Moshiri considers pulling the plug on his agreement with 777 Partners, insiders insist there is no shortage of suitors. Experts maintain a new owner, after short-term pain, may yet net a “fantastic deal for themselves”.
What are Everton worth?
Somewhere between £1 and £500million, depending on who you ask. The 777 deal agreed with majority owner Moshiri in September was said by one dealmaker to be valued in excess of £500million, but with so much debt to clear, it is unthinkable the British-iranian businessman stood to pocket even a fraction of that for his 94.1 per cent stake. One variable on his takehome price is known to have been Premier League survival, which has now been secured, but, if Moshiri tears up his 777 deal, potential suitors will be pointing immediately to outgoings as they do their sums.
Although the last available accounts calculated official debt at under £400million, shareholder loans from Moshiri and operational instalments from 777 since last September take the figure beyond £1 billion:
♦ £159million – due to MSP Sports Capital last month
♦ £225million – due to Rights and Media Funding
♦ £4-5million – Metro Bank
♦ £190million – estimated payments into the club by 777 Partners
♦ £450 million – shareholder loans from Moshiri.
Kieran Maguire, a football finance lecturer at Liverpool University, suggests Moshiri will have been urged by some groups to walk away with a pound coin. “The sums would suggest the shares are worthless,” he explained. “If you say that the value of a house is £500,000 and you’ve got a mortgage of £600,000, you’re stuffed. I think 777 were willing to offer him something for the shares, none of the other interested parties, as far as I’m aware, were.”
How complicated will it be for a new investor to come in?
With 777 likely to want to claw back its £190 million as lawsuits pile up, a clean divorce has been ruled out for Moshiri, and that will affect whoever comes in, too.
It will be marginally easiest to offset various new debts for existing creditors, which is why Moshiri is so heartened that MSP Sports Capital is now willing to ponder a new takeover proposal.
MSP would approach Moshiri from a position of strength, with clauses attached to the money it already has in the club. The Esk, a respected Everton blogger and financial expert, explained in his latest analysis: “MSP Sports Capital has two distinct security arrangements. One is a standard fixed charge over all the assets of Everton Stadium Development Company Ltd. This means that, in default, MSP can acquire
the stadium to recover its loan. Alternatively, MSP has an option to acquire 50 per cent plus one share of Everton’s issued share capital... Exercising this option would give MSP majority control over Everton FC.”
Telegraph Sport understands MSP is not minded to trigger immediately such security arrangements, however, not least because there are other complicating factors. There is a sense of trepidation around the club’s larger loan to Rights and Media Funding, for instance. Sources close to MSP blamed stipulations on that other loan as the major factor behind its decision to walk away from buying a stake in the club.
Another factor will be clarity over Moshiri’s shareholder loans. Both Maguire and the Esk agree “the assumption must be that Moshiri’s £450million of outstanding shareholder loans are written off completely”.
What do the experts think will happen?
The club maintain they are not at risk of administration. There has not been a single late payment to staff or players in the Moshiri era. If the 777 deal collapses, club staff hope Moshiri will dip into his own wealth to keep the club afloat. But both Maguire and the Esk appear to have their doubts.
“There is no simple solution here,” wrote the Esk in his latest blog, suggesting it may be “wishful thinking” to hope Everton “can escape” administration. “It’s all a bit precarious,” Maguire added, saying he did not see why new owners would want to pay anything to Moshiri to take on such debt.
Fans are quick to point out administration and further points deductions would not be the devastating blow they once were with an 11-point cushion from the relegation zone. But there would also be a human cost. Players would almost certainly be sold and jobs would be lost as debts are paid off.
Why might this be a good deal after all?
With a brilliant new stadium at Bramley-moore Dock to move into next summer, the outlook will change quite quickly, so long as the club’s top-tier status remains intact.
Potential buyers may look to the example set at Tottenham Hotspur to see that short-term pain can bring long-term gain. By 2020, the final build of their new stadium had cost the club £1.2billion but, four years on, Deloitte money league tables saw them leapfrog Chelsea as London’s highest-earning team, with annual revenues of £549.2million. Sam Boor, a director in Deloitte’s Sports Business Group, said: “A huge reason for Tottenham’s growth is the club being able to fully leverage and monetise the stadium, both in terms of the match-day income and the commercial activities.”
With Chelsea selling for £2.5billion two years ago, Everton, with a better stadium to move in to, suddenly does not seem such a mad idea. “There is the prospect of someone emerging with this club with a fantastic deal for themselves, but not for the lenders,” Maguire said. “Again, as with everything, it will come down to price.”