777 Partners Faces Hurdles in Everton Takeover Amid Premier League Delays

Key Takeaway

• 777 Partners faces hurdles in Everton takeover, including Premier League delays and fraud accusations, with debts over £500 million.
• Restructuring specialist Mark Shapiro from B Riley Advisory Services hired as COO to navigate acquisition challenges.
• B Riley's past controversies and operational scrutiny add complexity to the takeover process.

777 Partners' Everton Takeover Efforts

777 Partners, a US-based investment firm, is actively working to acquire English Premier League football club Everton, facing several hurdles in the process. The firm has encountered delays as the Premier League has yet to approve the takeover, prompting 777 to request extensions for completing the deal. Amidst these efforts, 777 has been accused of fraud by lenders in a New York court, adding complexity to their acquisition plans. To navigate these challenges, 777 has enlisted the expertise of restructuring specialists, appointing Mark Shapiro from B Riley Advisory Services as the chief operating officer, signaling a strategic move to address operational challenges and streamline the takeover process.

Everton's Financial Struggles

Everton Football Club, the target of 777 Partners' acquisition efforts, is grappling with significant financial burdens, with debts exceeding £500 million ($625 million). A substantial portion of this debt stems from the construction of a new stadium at Bramley Dock in Liverpool. Despite these financial challenges, Everton's status as a Premier League team presents a lucrative opportunity for 777 Partners, potentially offering higher revenue streams compared to the firm's other football investments, such as Genoa in Italy, Standard Liege in Belgium, and Vasco da Gama in Brazil.

B Riley's Role and Controversies

B Riley Advisory Services, part of B Riley Financial Inc., a boutique investment bank, has been brought into the fold to assist 777 Partners. However, B Riley has faced scrutiny over its past dealings, particularly concerning its former business partner Brian Kahn, linked to the 2020 collapse of Prophecy Asset Management hedge fund. Kahn has denied any wrongdoing, and B Riley has distanced itself from the Prophecy collapse, stating it had no knowledge of the events leading to the hedge fund's failure. Nonetheless, the firm has faced criticism from short sellers and experienced delays in releasing its audited financials, with auditors pointing out material weaknesses in its internal controls.