06/06/2024 33comments  |  Jump to last

777 Partners' major lender, A-Cap, together with a partner firm, are proposing to undertake major investment in Everton that would ultimately see them take a non-controlling equity stake in the Club.

According to David Hellier and Jill Shah of Bloomberg, citing "people familiar with the matter", Advantage Capital Holdings, led by Chairman and CEO, Kenneth King, are in talks with Farhad Moshiri over an offer to buy out a portion of the British-Iranian's shareholding and then refinance Everton's existing debt as co-owners.

777 saw the Share Purchase Agreement they struck with Moshiri back in mid-September finally expire on 31 May with the Miami-based company unable to come up with the funds necessary to meet the Premier League's requirements for them to approve the takeover.

In the interim, 777 have loaned Everton in excess of £200m, primarily to cover construction costs for the new stadium at Bramley-Moore Dock, but it is generally believed that that money was fronted in the first place by New York-based A-Cap.

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A-Cap are reportedly in the process of decoupling from their relationships with 777 Partners after the latter's Bermuda-registered reinsurance firm, 777 Re, had their credit rating downgraded and are, according to the FT, attempting to take back control of assets ceded to that subsidiary company.

Meanwhile, both 777 Partners and A-Cap were named in a civil lawsuit filed by Leadenhall Partners of London last month in which the former were accused of fraudulently borrowing against £350m in assets that "it didn’t own, didn’t exist or were already promised to someone else."

Furthermore, 777 recently brought in restructuring experts, B. Riley and co-founders Josh Wander and Steve Pasko resigned their positions as managing partners.

If this latest report from Bloomberg is true, A-Cap, who are allegedly exposed to liabilities with 777 Partners totalling around £2bn, could see taking a stake in Everton and leaving Moshiri as majority owner as the surest way to recouping funds loaned to the Club through 777.

Neither Moshiri nor A-Cap responded to requests for comment and the partner firm who could go in with the New York investment firm on this reported investment proposal has not been named.

Everton are currently indebted to Rights & Media Funding to the tune of £225m, owe 777 Partners £200m, MSP Sports Capital £158m and Metro Bank £10m, with some of those loans on cripplingly high rates of interest.


Reader Comments (33)

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Christine Foster
1 Posted 06/06/2024 at 19:24:19
This doesn't surprise me at all, refinancing the debt with A-Cap, Moshiri and another (MSP?) as a consortium?

Especially if MSP have an ace in their hand...

Sounds like a stop-gap measure and a means to protect investments already made.

Billy Roberts
2 Posted 06/06/2024 at 19:33:54
Firstly, thanks for the update, Lyndon, you deserve a medal.

Supporting Everton on every level is like purgatory... constant relegation battle; protracted points deductions, drawn out for months; transfers remember them) would go on interminably.

Boardroom resignations will they have the club announcements that never arrive... now this 9-month takeover saga that has become more complex than the war in Yugoslavia!!

I have read hundreds of mostly intelligent often enlightening posts on the debts, 777 Partners, Usmanov, A-Cap, R&MF, fuckin B+M, MSP and another group I can't even remember!!

I understand less now about big business and administration, debts, share ownership etc etc etc than I did at the beginning.

All I know is someone is going to take a fuckin haircut possibly.

Christine Foster
4 Posted 06/06/2024 at 19:37:17
The millstone around our neck is R&MF, always has been, and getting rid of them is key to any deal going forward.

Smart move by A-Cap if they can pull it off. But they just want a piece of the pie, not run a football club. That's the missing bit of the jigsaw.

Paul Hewitt
5 Posted 06/06/2024 at 19:42:11
Is this a good idea?

It sounds it.

Barry Rathbone
6 Posted 06/06/2024 at 19:43:26
Sounds like 777 Partners in disguise to me…
Christine Foster
7 Posted 06/06/2024 at 19:48:18
Barry, the backers of 777 are protecting the money they stumped up to them at the same time putting a long term solution in place for the debt.

It's a vital part of any solution to the crap we are in, but they obviously have no desire or intention of running a football club.

Lyndon Lloyd
8 Posted 06/06/2024 at 19:52:07
Barry, the more this story unravels, the more it seems as though A-Cap were 777 in disguise all along because it was their money that paid for 777 Football Group's acquisitions.

Prior to this, A-Cap would actually have been a safer bet as owners of EFC but now, through their exposure to 777, they're in a perilous situation themselves, albeit more likely to survive if they're not completely implicated in the fraud case in New York.

This looks like a stopgap measure that would allow A-Cap to eventually recoup their £200m and, if they're successful in restructuring our debt, it would reduce the financial stress on the Club.

It might also be good for Moshiri if he's content to sit tight. Eventually, both he and A-Cap could sell up for more than he could hope for now sitting on such a distressed asset.

Les Moorcroft
9 Posted 06/06/2024 at 19:57:36
So, Lyndon, it is good if it happens?
Christine Foster
10 Posted 06/06/2024 at 19:59:00
Lyndon, yes, but it leaves us without anyone who actually wants a football club.

Textor would fit that bill but would have to sell his Palace holdings first, so a holding pattern?

Barry Rathbone
11 Posted 06/06/2024 at 20:06:13
Christine @7 and Lyndon @8,

Thank you, I really have no idea about the intricacies of these matters, I just know "follow the money" holds sway.

It sure makes sense that these guys put up the loans and are now protecting their investment. Where it takes us… I have no idea!

Les Moorcroft
12 Posted 06/06/2024 at 20:13:26
Would this give Textor time to sell what he has in Palace? Then buy Everton?
David West
13 Posted 06/06/2024 at 20:28:08
Christine, spot on! A-Cap or 777, R&MF don't want to run a club. These are only interested in protecting or recouping their money.

Yes, stabilising the club would help their position, yet us as fans want to see progress, a cohesive plan from the boardroom, playing staff, recruitment, academy and right down the whole structure of the club.

Who knows where this is all going to end, but these don't seem like the long-term solution.

Gavin Johnson
14 Posted 06/06/2024 at 21:03:38
We knew all along that 777 didn't have the money, but if A-Cap do, this might be the best thing that could happen until the stadium's built, and Textor's sold his shares at Palace.

The one thing that is slightly worrying, which I didn't know, is that A-Cap are also named in the 777 lawsuit.

Mark Ryan
15 Posted 06/06/2024 at 21:07:11
What a crock of shit. So fed up with this.

Deadline day came and went. Moshiri is potentially the worst football club owner, ever!! I can't even begin to thank him for the new stadium. I hate him, and I hate Bill Kenwright.

I'll just wait for the war in Ukraine to end because that is the only hope for us, Usmanov, his puppet bell-end, and Everton FC. What has happened to us, for fuck's sake???

Gavin Johnson
16 Posted 06/06/2024 at 21:16:48
Comparable events have happened at other clubs.

I seem to remember AC Milan had a Chinese takeover, and it emerged early doors that they didn't have the money, so the company who lent them the money took control of the club.

John Wilson
17 Posted 06/06/2024 at 21:20:14
I did say 777's backers will try to do something like this.

Whether they are part of 777, that I don't know, but it would make sense as to how 777 can just pull money from backers out of thin air.

John Wilson
18 Posted 06/06/2024 at 21:26:12
For another thing, I was hearing lots of things from reputable sources about 777 being 'unsecured creditors and last in the queue, apparently.

But in reality, no such thing as that when a third party puts £200M into property, as that automatically provides a beneficial interest regardless.

Gavin Johnson
19 Posted 06/06/2024 at 21:33:10
The harbinger of doom, the Esk, has just poured cold water on this happening.
Tony Abrahams
20 Posted 06/06/2024 at 21:36:23
I was hearing that this other American group were very confident of purchasing the club, so hearing this news is like getting a kick in the teeth.

I agree with Christine, because with Rights & Media Funding currently making an absolute fortune out of Everton, why would they want things to change?

If A-Cap actually were 777 Partners in disguise, it does feel like it's been part of a long-term plan being played out between them and Usmanov, and our curse is going to continue.

Don Alexander
21 Posted 06/06/2024 at 22:15:24
Whatever's in the minds of these utterly leech-like pariahs circling us, I suggest the one thing they're going to have to grasp right now is the need, in their own interests as well as ours, to preserve a place in the Premier League.

Crippled as we are by Kenwright and Moshiri, we're in no position to sign anyone of note, and everyone knows the depth of the barrel of shite into which the gruesome twosome sunk us years ago.

That means we have to sell, big time, and urgently and that, married to our inability to spend, is a nigh-on perfect recipe for relegation next season.

Jerome Shields
23 Posted 06/06/2024 at 22:20:20
Still the same old Moshiri Story: 777 Re, A-Cap and 777 Partners.

A-Cap are in court trying to preven AM Best Credit Agency from downgrading their Credit Rating. Through the Bonza investigation, it has materialised that A-Cap is closely linked to 777 Partners.

The Mirror story is basically true, Moshiri is continuing the 777 way. The question is: Who really is pulling the strings in this continuing shambles? A-Cap will be no different.

Gavin Johnson
24 Posted 06/06/2024 at 22:29:46
It seems that A-Cap could just be 777 in disguise depending on how you want to look at it.

However, this story is pressing the notion that the £200M, and further money invested wouldn't be controlling equity, which was the plan under 777, which suggests it would be more of a holding arrangement to protect the money they've already put into the club via 777.

Paul Smith
25 Posted 06/06/2024 at 22:37:40
Paragraph from FT tonight linked by Paul Quinn:

"Stockbroker entrepreneur Andy Bell and property magnate George Downing are competing against US firm MSP Sports Capital to enter exclusive talks with Moshiri, according to people with knowledge of the matter "

Maybe it's just a conspiracy to make us think me might get out of this in one piece.

John Wilson
26 Posted 06/06/2024 at 22:54:35
Moshiri wont give a damn if 777 or A-Cap take us over, as long as he makes the most money from the deal.
Brent Stephens
27 Posted 06/06/2024 at 23:10:25
Paul #25,

I understood that Bell and Downing were acting as a conduit to channel MSP's money into Everton loans. It would be strange if they were now competing against MSP. I wonder why that might be.

Stephen Davies
28 Posted 07/06/2024 at 00:38:56
Everton's lenders battle to take control of Premier League club — Financial Times

Owner Farhad Moshiri is entertaining offers from rival creditors after sale to 777 Partners collapsed

Everton Football Club's creditors are battling to buy the Premier League side from its British-Iranian owner Farhad Moshiri, in the latest twist following the collapse of 777 Partners' takeover deal.

Stockbroker entrepreneur Andy Bell and property magnate George Downing are competing against US firm MSP Sports Capital to enter exclusive talks with Moshiri, according to people with knowledge of the matter.

While Bell, Downing and MSP are central figures because of the loans they have provided to help fund the club's new stadium, the people said Everton has received other investment proposals.

The Liverpool-based club has been in limbo since September, when 777 agreed to become its next owner. However, the Miami investment firm failed to meet a series of conditions required for Premier League approval and its deal with Moshiri expired last week.

BDT & MSD Partners, the merchant bank and investment firm, is ready to provide financing to the club as part of a takeover, according to people with knowledge of the matter. The US bank has not agreed to back either of the creditors yet, those people said, but is willing to support the most credible buyer.

BDT & MSD, Moshiri, Everton and Bell declined to comment. MSP and Downing were approached for comment.

US insurance group Advantage Capital Holdings, a big lender to 777, has made a separate proposal, according to a person with knowledge of the matter. Bloomberg earlier reported that A-Cap had offered to refinance all of Everton's existing debt and take a minority equity position, with Moshiri retaining a majority stake.

A-Cap did not comment on the proposal but previously told the Financial Times that it was now a “senior secured creditor of the club”.

Following its bid in September 2023, 777 provided more than $200mn of loans to Everton. The apparent shift of the debt to A-Cap follows the Miami firm's move to appoint an outside restructuring firm after clashes with 777's creditors and the unravelling of its Bermudian reinsurance funding structure.

A-Cap has been slashing its exposure to 777 after US state regulators and rating agencies raised concerns.

Everton is one of the most successful teams in English football history, having been crowned champions of England nine times, although the most recent of those triumphs came in 1987.

The lossmaking, indebted club has struggled since its finances were dealt a blow by the coronavirus pandemic, which meant matches had to take place in empty stadiums. Another blow came when Russia invaded Ukraine, forcing Everton to cut ties to sponsors connected to oligarch Alisher Usmanov, Moshiri's former business partner, who was placed under sanctions.

Meanwhile, Everton has had to finance the construction of a waterfront stadium that is designed to increase its match day takings in comparison with its current home ground, Goodison Park.

Jerome Shields
29 Posted 07/06/2024 at 05:47:04
Gavin #24,

You need a bigger umbrella to cover who is trying to protect or keep in play their money...

Jerome Shields
30 Posted 07/06/2024 at 06:23:34
The best outcome would be if BDT & MSD and MSP come to the fore, but it looks like that Moshiri is still mucking about with 777 Partners and A-Cap. Really BDT & MSP and MSP are battling for control with Moshiri, 777 and A-Cap.

Moshiri's shareholder loans are treated as equity (additional reserves in the accounts) and have been written off by Blue Sky Holdings. It is therefore £200M unsecured against the secured £158M Blythe Capital (MSP), with R&MF able to have a say.

In the case of MSP, the purchase of equity was blocked by R&MF, whilst 777 and A-Cap did not get beyond a Shareholder Purchase Agreement, not being able to provide the necessary monies.

Moshiri's only card is he is an owner passed by the Premier League. I wonder if there is anything in their rules that can reverse that.

Sam Hoare
31 Posted 07/06/2024 at 07:26:27
As much as I'm loathe to defend Moshiri, I don't know if it's fair to say he's ‘still mucking' around with 777 Partners and A-Cap. They've invested £200M into the club and kept the stadium going so it's not like he can just start ignoring their calls!

Obviously the whole thing is a mess of his and Kenwright's making but, one way or another, any way forward will involve discussions with A-Cap as one of our largest creditors.

Jerome Shields
32 Posted 07/06/2024 at 10:30:58
If Moshiri is determined to go down the A-Cap road, he is likely to bring in yet another investor.
Stephen Davies
33 Posted 07/06/2024 at 10:37:56
Some news about the takeover will be reported in the Athletic soon.

Basically either Bell and Downing consortium with BDT&MSD Partners or rich global investor consortium but not Textor (or presumably A-Cap).

Hopefully we all know soon.

Danny O’Neill
34 Posted 07/06/2024 at 11:11:48
What a drama this has all been, but maybe a solution on the horizon?

Who knows? There will probably be a few more twists and turns in this.

Peter Hodgson
35 Posted 07/06/2024 at 11:20:50
I was surprised when I heard that A-Cap's name had been mentioned as possibly an interested bidder, until I remembered how they were 777's main source of funds and they were the ones who probably provided 777 with the £200M they lent Everton.

It was then I thought that the only interest A-Cap had in us was getting their £200M back. My view hasn't changed. A-Cap are 777 wearing a different set of clothes (so probably Moshiri will like them and favour them over all others).

Therefore… No Thanks. With that pedigree, we don't want them anywhere near the club.

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