The Friedkin Group reaches agreement to buy Everton

[kenada_blue]

Ultimately TFG didn’t want Everton enough to override their concerns over 777’s loan.
Simply they didn’t value ownership of Everton worth the perceived risk.
That’s another bullet dodged for me.
I would prefer to be owned by people who valued the club and didn’t just see us purely as a vehicle to increase their wealth.

It's toxic debt mate. Nothing to do with how they value the club.

You're dropping £600mill to buy a club. £200mill of that could be sitting off still attached to the club for years having a negative impact on your business as it goes through legal processes.

It's bad business unless they don't care about it and have enough money to do so.

 

[catcherintherye]

Yeah it's what I've gathered from it all.

Every other potential buyer will have to make the same decision over it.

Still don't know why Mosh doesn't just pay it. Once its in the clear...the the buyer pays him.

Well I'd post a couple of things:

1) There is a legitimate question as to who you pay. The court is helping to ascertain this. Nobody is going to risk paying people twice.

2) Currently the payment due is going to be far beyond what he receives for his equity. So that's not a goer.

3) Once the court decides, there is a possibility the 200m becomes worth very little, and they can go back with an offer of say £25m and it will be accepted. Maybe less. But you know, why would you pay 200m when you wouldn't need to?

 

[kenada_blue]

Well I'd post a couple of things:

1) There is a legitimate question as to who you pay. The court is helping to ascertain this. Nobody is going to risk paying people twice.

2) Currently the payment due is going to be far beyond what he receives for his equity. So that's not a goer.

3) Once the court decides, there is a possibility the 200m becomes worth very little, and they can go back with an offer of say £25m and it will be accepted. Maybe less. But you know, why would you pay 200m when you wouldn't need to?

Yeah. It's a mess.

Hence why to me as this is Moshiri's doing and he wants to sell the club...he should look absorb it and separate from the club.

 

[micknick]

I know everyone is putting it at Friedkin for pulling out but the statement does say both parties agreed.

I can’t help feel there’s shenanigans going on. If this in some way puts pressure on the liquidators for 777/acap to accept a reduced pay back rather than no payback. A hard ball tactic to pull out only to use that to get a reduction.

I imagine it’s all moot until the proceedings for 777 and the numerous legal battles take place.

 

[catcherintherye]

Yeah. It's a mess.

Hence why to me as this is Moshiri's doing and he wants to sell the club...he should look absorb it and separate from the club.

As indicated though, there's no real sense in doing that.

 

[catcherintherye]

I know everyone is putting it at Friedkin for pulling out but the statement does say both parties agreed.

I can’t help feel there’s shenanigans going on. If this in some way puts pressure on the liquidators for 777/acap to accept a reduced pay back rather than no payback. A hard ball tactic to pull out only to use that to get a reduction.

I imagine it’s all moot until the proceedings for 777 and the numerous legal battles take place.

It could well be a hardball tactic. Everybody knows Moshiri can't/won't pay them. Now theoretically TFG won't pay them.

 

[Nymzee]

Ultimately TFG didn’t want Everton enough to override their concerns over 777’s loan.
Simply they didn’t value ownership of Everton worth the perceived risk.
That’s another bullet dodged for me.
I would prefer to be owned by people who valued the club and didn’t just see us purely as a vehicle to increase their wealth.

Nah. I really can’t blame them not wanting to go through with it considering how dodgy the debt they’d be inheriting is.

We would applaud Everton not going through with a player signing if the person had a dodgy character or mystery injury so what’s the difference here?

 

[Bayboy]

The fact is, the longer it takes to push any takeover through, the bigger our debt mountain grows and the less attractive we become. The only time that changes is if we go into administration.

 

[Eggsyblueskin]

It's toxic debt mate. Nothing to do with how they value the club.

You're dropping £600mill to buy a club. £200mill of that could be sitting off still attached to the club for years having a negative impact on your business as it goes through legal processes.

It's bad business unless they don't care about it and have enough money to do so.

I don’t disagree with you.
But I think if they wanted to own Everton enough they would have found a way to overcome their concerns.
They didn’t want us enough .
So good riddance .
I would prefer someone who is determined enough to take on any risk associated in the purchase.
Because in order to make a football club successful you have to be prepared to gamble at some point, it can’t be viewed in purely business terms.
If they weren’t willing to take on and manage risk at the outset they may not have been willing to do it at any point in their ownership.
For this reason alone I am not shedding any tears for this failed transaction.

 

[Moomin]

It's bad but not in the way people say. As usual the idiots around the mythical fire sale back out again (what happened to the January fire sale, or the May fire sale, or the June fire sale, or the July fire sale etc).

Short term TFG have heavily capitalised the club, paid off imminently due debt which could have triggered admin (and was frankly the central risk factor of that). They have paid off the stadium so no more money required for that. At a much lower interest rate than previous and money not due back in the short term. Everton have Sky money coming in August, and Onana cash dropping, as well as money for Gordon. Not only will this be cash-cash, but it will be booked as high profit on the accounts.

The issue is more longer term, in that we will require a new buyer, as Moshiri has checked out. The club is still paying high rates on it's debt, which is a big part of why we lose money and at some point pinch points re-emerge.

There's also the issue that the club lacks leadership.

70 million still to be paid for the internal fitout of the stadium.

 

[MikeH72]

I know everyone is putting it at Friedkin for pulling out but the statement does say both parties agreed.

I can’t help feel there’s shenanigans going on. If this in some way puts pressure on the liquidators for 777/acap to accept a reduced pay back rather than no payback. A hard ball tactic to pull out only to use that to get a reduction.

I imagine it’s all moot until the proceedings for 777 and the numerous legal battles take place.

I’m not, I’m putting it on Moshiri.

 

[Eggsyblueskin]

Nah. I really can’t blame them not wanting to go through with it considering how dodgy the debt they’d be inheriting is.

We would applaud Everton not going through with a player signing if the person had a dodgy character or mystery injury so what’s the difference here?

I don’t blame them.
They are business men and they made a sensible business decision that they didn’t value ownership of our club over any inherent risk associated with the purchase.
But I would prefer owners who see us as more than a money making opportunity.
The business must serve the football , not vice versa .
Let’s hope we get owners who value owning Everton more highly than TFG evidently did .

 

[barneygumble]

It's not uncommon in M/A transactions for this sort of thing to happen. There are some differences though. They are paying Moshiri very well, so it's not like they can bargain that down much.

I suspect it has to do with trying to negotiate down creditors (specifically King) and/or allowing the v unlikely but very damaging event that the stuff with 777 gets generalised. Currently Moshiri is on the hook for that. Until the court case is decided, any possibility is open. Once that is resolved then you know what you are dealing with, and you remove the possibility of black swan event. You also have the chance to then heavily negotiate King down, as he has unsecured debt that in all likelihood he would never receive given where he sits in relation to other creditors. Throw in their org being in admin, and if somebody offers say 5p in the pound and they may take it.

I am buying a house currently, solicitors want money for checks, I'm not paying them anything until the survey is done. Once that is cleared, I will move forward. I do wonder if that is some of the thinking here.

I don't think they're done at all.

But you don't want the bad debt associated with your legacy you've built decades dealing with.

Ironically, Moshiri desperate to rid himself of the club, yet his desperation is what has meant he has full control.

If it wasn't cruel for all blues, I'd say it's quite ironic.

I still expect, having read all the articles possible and the club statement, that they're not done, but may try to find a financially beneficial way of using it to their advantage.

 

[MikeH72]

It's bad but not in the way people say. As usual the idiots around the mythical fire sale back out again (what happened to the January fire sale, or the May fire sale, or the June fire sale, or the July fire sale etc).

Short term TFG have heavily capitalised the club, paid off imminently due debt which could have triggered admin (and was frankly the central risk factor of that). They have paid off the stadium so no more money required for that. At a much lower interest rate than previous and money not due back in the short term. Everton have Sky money coming in August, and Onana cash dropping, as well as money for Gordon. Not only will this be cash-cash, but it will be booked as high profit on the accounts.

The issue is more longer term, in that we will require a new buyer, as Moshiri has checked out. The club is still paying high rates on it's debt, which is a big part of why we lose money and at some point pinch points re-emerge.

There's also the issue that the club lacks leadership.

Moshiri can’t “check out”, it’s his business, he is the owner. Furthermore this debt is his. I can’t just “check out” of paying my mortgage, however much I want to.

 

[Neiler]

It's not uncommon in M/A transactions for this sort of thing to happen. There are some differences though. They are paying Moshiri very well, so it's not like they can bargain that down much.

I suspect it has to do with trying to negotiate down creditors (specifically King) and/or allowing the v unlikely but very damaging event that the stuff with 777 gets generalised. Currently Moshiri is on the hook for that. Until the court case is decided, any possibility is open. Once that is resolved then you know what you are dealing with, and you remove the possibility of black swan event. You also have the chance to then heavily negotiate King down, as he has unsecured debt that in all likelihood he would never receive given where he sits in relation to other creditors. Throw in their org being in admin, and if somebody offers say 5p in the pound and they may take it.

I am buying a house currently, solicitors want money for checks, I'm not paying them anything until the survey is done. Once that is cleared, I will move forward. I do wonder if that is some of the thinking here.

Good to see you about mate!