Moelis & Co. has been hired to look into 777 Partners LLC's portfolio of soccer teams, according to people with knowledge of the matter, raising fresh questions about the future of sports' largest multi-club owner.
The investment bank was appointed by New York insurer Advantage Capital Holdings LLC, a major lender to the 777s, according to the people. Morris is considering various options for the 777s' soccer-related assets, including a possible sale of the assets, the people said.
A-Cap's loan to 777 is backed in part by the assets of a Miami-based investment firm whose soccer assets include Brazil's Vasco da Gama, Italy's Genoa Cricket and Football Club, Germany's Hertha Berlin and Paris-based Red Star FC.
777 has been trying to bolster its portfolio with its purchase of English Premier League soccer club Everton Football Club, a deal that has been dogged by financing problems and scrutiny over the management of 777's far-flung businesses, some of which have had problems with creditors.
Everton owner Farhad Moshiri, who has agreed to sell his Premier League team to 777 in September 2023, told fans earlier this week that he will not negotiate with anyone until the end of May, when his sale agreement with 777 expires, despite having received unsolicited approaches recently.
777 came under fire this month from other lenders, including Leadenhall Capital Partners, after co-founder Josh Wonder allegedly double-pleaded assets.
Leadenhall said in his lawsuit filed in New York that 777 and A-Cap are deeply intertwined and that A-Cap was able to block 777's attempts to restructure its loans to other lenders. Leadenhall alleges that as of the end of last year, A-Cap owed more than $2.2 billion to affiliates of 777. A-Cap denies any ownership interest in 777.
But A-Cap's decision to appoint a restructuring expert such as Moelis will sharpen the focus of 777's finances and could call into question not only its deal with Everton but also its status as one of football's leading multi-club owners.
The people, who asked not to be identified because the matter is confidential, said the talks are at an early stage and it was unclear whether they would lead to a sale of 777's soccer assets. Representatives for A-Cap, Morris and 777 declined to comment.
Maurice has a growing presence in the sports market, having advised on the 2022 bid for Chelsea FC, as well as the sale of Grasshopper Zurich to LAFC and the sale of the Phoenix Suns and Mercury.
The 777 are among the early proponents of the multi-club model, which is touted as a system for developing and sharing talent without the need for expensive transfer fees. The model also offers owners the opportunity to pursue cost synergies and secure more lucrative sponsorship deals across their portfolio. Critics say multi-club ownership only creates farm clubs to cater to the needs of the biggest players in the group.
Bloomberg's Jill Shah co-authored the report.
Copyright 2024 Bloomberg.
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