Everton’s proposed takeover by the Friedkin Group, led by American billionaire Dan Friedkin, has fallen through due to concerns about ongoing debt. The club had been in exclusive talks with the American consortium since mid-June, with the expectation that they would purchase Everton. However, a statement released on Friday morning confirmed that negotiations had collapsed and the takeover would no longer proceed.
The statement explained that both parties agreed it was in their best interests for Everton to explore alternative options. Despite the failed takeover, the Friedkin Group remains a lender to the club, having already provided £200 million to cover existing debts and construction costs for Everton’s new stadium at Bramley-Moore Dock.
However, the future of Everton itself is now uncertain. The main reason for ending the talks was TFG’s concern about the scale of debt owed to 777 Partners. 777 Partners is currently facing insolvency and allegations of fraud, and TFG was unwilling to take on the issues associated with Everton’s £200 million debt to that company. According to The Athletic, Everton owes over £600 million to 777 (now controlled by American firm A-Cap), TFG, and local lenders Rights and Media Funding. In addition, there are £450 million in shareholder loans to existing owner Farhad Moshiri.
Moshiri, who owns 96 percent of the club, is said to have effectively written off those loans. However, he has been unable to fund the club for over a year. Although administration is not currently seen as an immediate risk, it cannot be ruled out if Everton is unable to resolve the debt situation. The mounting bills for the construction of their new stadium and the debts owed to various companies make it challenging for Everton to attract investors.
Furthermore, Everton has faced scrutiny from the Premier League in the past. Last season, they were sanctioned for historic Profit and Sustainability Regulations (PSR) infringements, resulting in an eight-point deduction after appeal. The club was involved in a series of questionable deals before the PSR deadline, including the signing of midfielder Tim Iroegbunam from Aston Villa and the departure of striker Lewis Dobbin for similar fees.
In terms of player transfers, Everton has made some recent sales. Centre-back Ben Godfrey was sold to Atalanta for approximately £8.4 million, and the £50 million sale of midfielder Amadou Onana to Aston Villa seems imminent. However, bids from Manchester United for centre-back Jarrad Branthwaite, ranging from £43 million to £50 million, have been rejected. United has since signed teenager Leny Yoro in a deal worth up to £59 million, but it remains to be seen if the collapse of the Friedkin Group’s takeover will affect Branthwaite’s future at Everton.
Overall, Everton’s failed takeover and the significant debt they owe to various companies have created uncertainty about the club’s future. The collapse of the deal with the Friedkin Group raises concerns about their ability to attract new investors and resolve their financial situation. It is crucial for Everton to find alternative options and address their mounting debts to ensure the stability and success of the club.