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777’s Football Empire Under Review After Lender Hires Moelis

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Moelis & Co. has been hired to review 777 Partners LLC’s portfolio of football teams, people with knowledge of the matter said, raising fresh questions about the future of one of the sport’s biggest multiclub owners.

The investment bank has been appointed by New York insurance company Advantage Capital Holdings LLC, a major lender to 777, according to the people. Moelis is evaluating a range of potential options for 777’s football holdings, including possible asset sales, they said.

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A-Cap’s loans to 777 are secured against some of the Miami-based investment firm’s assets. 777’s football assets include Vasco da Gama in Brazil, Italy’s Genoa Cricket and Football Club, Hertha BSC in Germany and Paris-based Red Star FC.

777 has been trying to add to its stable with an acquisition of English Premier League football club Everton FC. The deal has been dogged by financing problems and scrutiny of 777’s management of its sprawling collection of businesses, some of which have run into difficulties with creditors.

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Everton owner Farhad Moshiri, who agreed to sell the Premier League team to 777 in September 2023, told fans earlier this week that he has recently received unsolicited approaches but that he won’t negotiate with anybody until the expiry of the sale agreement with 777 at the end of May.

777 this month faced accusations from other lenders, including Leadenhall Capital Partners, that its co-founder Josh Wander double pledged assets as collateral.

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Leadenhall said in a lawsuit filed in New York that 777 and A-Cap are so entangled that A-Cap has been able to block efforts by 777 to restructure loans to other lenders. Leadenhall claims that A-Cap was owed more than $2.2 billion by entities affiliated with 777 at the end of last year. A-Cap has rejected any ownership ties to 777.

But A-Cap’s decision to appoint a restructuring specialist like Moelis will sharpen the focus on 777’s finances and could cast doubt over not only the Everton deal but also its status as a leading multiclub owner in football.

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Deliberations are in the early stages and there’s no certainty they’ll result in any sales of 777’s football assets, the people said, asking not to be identified discussing confidential information. Representatives for A-Cap, Moelis and 777 declined to comment.

Moelis has been growing its presence in the sports market. It advised on the bid for Chelsea FC in 2022 and also advised on the sale of Grasshopper Zurich to LAFC and the sale of the Phoenix Suns and Mercury.

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777 was one of the early proponents of the multiclub model, which is touted as a system for developing and sharing talent without the need for hefty transfer fees. It also offers owners the chance to seek cost synergies and strike more lucrative sponsorship deals across a portfolio. Critics say multiclub ownership merely creates farm clubs to serve the needs of the biggest names in a group.

Bloomberg’s Jill Shah co-authored this report.

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Copyright 2024 Bloomberg.

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