Everton’s upcoming three games in seven days could have significant consequences for their long-term goals and Premier League prospects. Following their devastating 6-0 defeat against Chelsea, the Toffees will face Nottingham Forest, Liverpool, and Brentford in consecutive home matches. This crucial period comes at a time when Everton’s on-field struggles coincide with their uncertain off-field future, as the ongoing 777 takeover saga continues to unfold.
The financial situation at Goodison Park is cause for concern, evident from two charges for breaching financial rules, resulting in the loss of eight points. The club’s appeal against two of these points is still pending. Additionally, Everton reported losses of £89.1 million for the 2022-23 season, with net debt reaching £330.6 million. To avoid further breaches of profit and sustainability rules, the potential sale of prized asset Jarrad Branthwaite has been considered.
Delving deeper into Everton’s financial woes, it becomes apparent that they owe a staggering £580 million to third-party lenders. These loans include amounts from Rights and Media Funding (£231m), 777 Partners (£180m), MSP Sports Capital and two local businessmen (£158m), and Metro Bank (£11m). Furthermore, Everton’s revenue for the 2022-23 season was £172 million, with a wages to income ratio of 92%. The repayment of the MSP loan, which was due on Monday, has been temporarily resolved through an extension agreed upon by current owner Farhad Moshiri and the New York-based investment firm until the end of the season.
The anticipated 777 takeover, agreed upon in September 2023, remains unresolved. The Miami-based investment firm aims to satisfy the Premier League’s owners’ and directors’ test by providing evidence of the source of funds and demonstrating sufficient financial resources for the next three years. While 777 co-owner Josh Wander has engaged in talks with the Premier League, four pre-conditions have been established. These conditions include repaying loans owed to MSP and two local businessmen, converting £180 million of 777’s loans into equity, injecting £60 million for day-to-day operational costs, and funding approximately £100 million for the completion of Everton’s new stadium.
Sources close to the takeover have expressed Wander’s eagerness to finalize the deal. The main obstacle lies in the MSP loan, which was initially intended for the construction of Everton’s new stadium at Bramley-Moore Dock. However, 777 claims to have the means to cover the £158 million owed, whether through their own balance sheet or via third-party investors. Once this matter is resolved, it is expected that the takeover will be completed shortly thereafter.
There have been concerns that Everton could face administration if the 777 takeover falls through. In such a scenario, an American group has shown interest in taking over, but this would require Everton to undergo another owners’ and directors’ test. Additionally, they would need to provide a minimum of 12 weeks’ worth of operating costs (approximately £30 million per week) and fund the construction company Laing O’Rourke for the new stadium. Administration is considered a last resort, as it would result in an immediate nine-point deduction for Sean Dyche’s struggling team.
Currently, Everton’s form is dismal, with only one victory in their last 15 games. The team is still reeling from their humiliating defeat against Chelsea, prompting manager Sean Dyche to criticize his players’ lack of professionalism and poor performance. These performances are particularly concerning given Everton’s uncertain future. If they continue in this manner, relegation to the Championship could become a reality, ending their proud top-flight status that has remained unbroken since 1954.