Inside Everton's Friedkin takeover: From the precipice to fresh hope thanks to new U.S. owner

The call that changed the course of Everton’s future came just as a rival group were close to agreeing their own takeover deal.

In late June, The Friedkin Group (TFG), whose main headquarters are in Houston, Texas, pipped Everton-supporting duo Andy Bell and George Downing to enter into exclusivity with then-majority shareholder Farhad Moshiri.

Bell and Downing, backed by MSD, the family office of American billionaire Michael Dell, had been just days away from securing their own exclusivity deal with Moshiri. Yet within less than a week of their call of intent, which came in early July, TFG had stolen a decisive march.

Crucially, they granted another stay of execution to a club that had long been straining to keep head above water.

As part of the terms of the exclusivity agreement with Moshiri, TFG provided an immediate £200million. They also took over another £150m loan from U.S. group MSP Sports Capital, Bell, Downing and Moshiri, while providing additional funds to help cover everyday running costs and payments for the new stadium project at Bramley-Moore Dock.

Those loans and all other short-term debt will now be converted into a mix equity and long-term senior debt, secured against the new stadium, significantly improving the club’s financial position.

Moshiri ploughed in around £800m during his time at the club, including £450m in the form of shareholder loans. But the club’s cash situation became increasingly fraught when his money dried up. By the end, they were reliant on short-term, high-interest loans from the likes of 777 Partners, and longer-term lenders like RMF, to see them through.

TFG had shown interest in Everton, seeing some of the club’s community values as attractive benchmarks, before buying Roma in 2020. It had been near the top of the initial pitch-list set up by Deloitte’s Sports Business Group, who were appointed by Moshiri to run the sales process in 2022.

TFG’s arrival on the scene was — and still is — seen by many sources close to the takeover process, who, like all those in this article are speaking to The Athletic anonymously to protect relationships, as something akin to a best-case scenario for Everton, given the struggles of recent years.

Run by president Dan Friedkin, the son of founder Thomas H. Friedkin, TFG boasts annual revenues of £10billion ($13bn). It made its money predominantly by selling Toyota cars in the U.S. but has expanded into other spheres including entertainment, film and luxury travel. It has a recent — albeit chequered — history in sports, owning the Italian club Roma and French fourth-tier side Cannes, something that was viewed as a positive by those on the deal side as the nuances of the industry were understood from the outset and allowed TFG to move quickly.

By the same token, rivals Bell and Downing had always been reluctant bidders, buyers of last resort. While they had skin in the game, in the form of loans advanced to the club, and were regulars in Goodison’s corporate lounges, they had always been prepared to step aside if a more suitable alternative came along. Even in their eyes, TFG was just that.

News of TFG’s exclusivity with Moshiri promised to end years of uncertainty and turbulence at Everton, who had long sought a new owner.

In that period of limbo, as a financially-hamstrung Moshiri sought a way out, the club urgently needed to find ways to service its cash demands.

Founded in 1878 and a key protagonist in the inception of the Premier League, Everton have been part of English football’s top tier since 1954. But alongside three successive relegation battles and two breaches of the Premier League’s profit and sustainability regulations (PSR), the club was being run by a threadbare, interim board set up to handle MSP’s minority investment in summer 2023.

To the surprise of no one familiar with Moshiri’s tenure, though, there would be one final twist.

A month after securing exclusivity, TFG pulled out of talks, citing concerns over some of Everton’s debt and uncertainty reigned once again. John Textor, the American owner of the Eagle Football Group which owns a 45 per cent stake in Premier League club Crystal Palace, tried to strike a deal with Moshiri, only for TFG to dramatically return to the table in September and agree terms.

TFG’s takeover of Everton, through Roundhouse Capital Holdings, an entity within the wider company, has now finally been completed, bringing to an end years of turbulence at Goodison Park.

Representatives of the group had been on Merseyside since the start of December, waiting for the green light. The Premier League informed all parties involved last Thursday, following a board meeting, that it was minded to approve the transaction, with the decision rubber-stamped by an independent oversight panel on Wednesday.

Approval from the Financial Conduct Authority, one of three bodies along with the Premier League and the Football Association that must sign-off any takeover, also came late last week. The transaction was formally completed late on Wednesday and representatives of TFG, including new exec-chair Marc Watts, are set to be at Goodison Park on Sunday for the home game against Chelsea.

This has been a story of patience and many ups and downs. Here, The Athletic details:

• Why TFG had long-standing interest in Everton
• The group’s early priorities now the deal is done
• How Moshiri’s financial situation left the club scrambling to plug funding gaps
• Why some close to the process thought administration would be beneficial in the long term
• The lesser-known executives who played a key role in safeguarding future

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Summer 2023 was a critical point for Everton, who were seen as a distressed asset during the takeover process. At that stage, the cash demands on the club, in the midst of a costly stadium development, were nearly crippling.

Writing in Everton’s 2022-23 accounts, auditors Crowe UK noted that there was a “material uncertainty” over the club’s ability to continue as a going concern in the event of relegation. Sean Dyche took over as manager midway through that season and it took a second-half winner from Abdoulaye Doucoure on the final day for Everton to avoid the drop.

Everton had long been reliant on Moshiri, who arrived in 2016 as majority shareholder, to fund heavy losses — between 2018 and 2023, Everton were £400m in the red — and help pay for their £760m new stadium project on Liverpool’s waterfront. Servicing the short-term, high-interest debt had proven increasingly problematic.

It is not uncommon for top clubs to run at a loss, subsidised by a wealthy benefactor like Moshiri, but Everton’s numbers were startling.

The problem was that Moshiri’s money had dried up.

In March 2022, around a week after Russia’s illegal invasion of Ukraine, Everton suspended sponsorship ties with companies linked to his close associate Alisher Usmanov, a sanctioned oligarch of Uzbek descent. Moshiri’s access to sources of funding was cut off.

That season, Moshiri first entertained the idea of selling up. He entered exclusive talks with the little-known KAM Sports, led by Minnesota real estate tycoon Maciek Kaminski, but the deal quickly fell apart when proof of funds could not be established.

Moshiri then reaffirmed his commitment to Everton and insisted the club was not for sale, but many with knowledge of the process, speaking anonymously to protect relationships, believe that delay in establishing a proper sales process was a significant error.

At that stage, the top level of the club was arguably at its most dysfunctional. The general view among sources consulted by The Athletic was that Moshiri, while well intentioned, was poorly advised and had little faith in the rest of the hierarchy.

The image that was painted at the time was of at least two versions of Everton, one run out of Liverpool by then chairman Bill Kenwright and CEO Denise Barrett-Baxendale, the other by Moshiri from Monaco or London. Neither vision was compatible with the other, creating a damaging disconnect and an incredibly strained — at times ineffective — decision-making process.

The initial sales process was unsurprisingly poor. The club was hawked around by numerous parties and stakeholders, most of whom claimed to be working on the authority of Moshiri or others at the club, but with little synergy or coherence.

At least one bidder who attempted to buy the club walked away with the suspicion that Moshiri or those close to him never really wanted to sell, although he and his advisors have always insisted in recent years that the club has been for sale.

Financial services firm Deloitte was eventually employed, ahead of merchant bank The Raine Group, to run a formal sales process by Moshiri’s Blue Heaven Holdings.

The first real solution to Everton’s cash struggles was MSP Sports Capital, a U.S. investment group led by the former agent Jeff Moorad and businessman Jahm Najafi.

As reported by The Athletic’s Matt Slater, MSP came close to sealing minority investment in Everton as part of a complex deal that would have seen them invest an initial £150m in convertible debt in exchange for an eventual stake of around 25 per cent, but walked away when the deal was blocked by one of Everton’s other lenders, Rights and Media Funding (RMF).

Like many of the club’s other creditors, RMF, a relatively obscure lender based in Cheshire, north-west England, had a change of control clause that gave it a key say in any takeover. It was seen by others in the process as a key stakeholder that needed to be satisfied.

RMF, which at that point had loaned Everton £200m secured against club assets, did not want to give up its position against potential default and felt MSP was not putting in enough money in return for its equity.

It was felt by other stakeholders that the loan to Everton’s stadium holding company did not suffice and needed to be more holistic, meeting the needs of the wider club in general.

The only other show in town, at that stage, was the controversial Miami-based 777 Partners, who had also been interested prior to MSP entering exclusivity.

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With the club in urgent need of cash, a deal was agreed with 777 just three weeks after MSP walked away.

777 was not seen as a perfect solution, but as a way for Everton to meet their immediate and financial needs. Until late in the process, when Moshiri was able to pick from a list of bidders, just about every other decision had been a forced one.

Even then, there was plenty of negative noise around 777 and their co-owner Josh Wander.

777 was initially lent some credibility by the presence of its football CEO, Don Dransfield — a respected former executive with The City Football Group — and the financial institutions — like boutique sports finance firm Tifosy as well as a stream of respected investment analysts — that were working on its behalf.

People close to the deal were aware of the rumour mill around 777 and the spate of negative stories about its inability to honour financial obligations. But initial due diligence from a number of stakeholders on all sides of the deal failed to turn up anything that would derail its bid.

As part of its agreement with Moshiri, 777 loaned Everton regular sums of around £20m to help the club continue payments to stadium constructors Laing O’Rourke.

The original plan for the development had been for Moshiri to fund the early stages, before going to market to secure external financing to complete the project. Usmanov’s USM had been lined up for a naming rights deal, estimated to be worth in the region of £200m.

But sanctions closed off that avenue and Everton were left looking to plug the funding gap at short notice. The slump in their on-pitch performance and perilous PSR position made them less attractive to owners, with the global geopolitical situation adding an extra risk. The MSP and 777 deals were in effect designed to plug the problem.

The expectation when the 777 deal was agreed in September was that the takeover would be completed by the end of 2023, but it took until March 2024 for 777 to be granted conditional approval by the Premier League. The FCA and the Football Association (FA) had given their assent.

Although the exact terms outlined by the Premier League remain undisclosed, they were understood to have involved repayment of MSP’s near £160m loan, proof of funding for the financial tranche of Everton’s new stadium project and money deposited in an escrow account to help the club meet its cash demands until the end of that season.

These looked like significant obstacles for a group that had fallen into financial difficulties, but several sources believe they would not have been a stumbling block at earlier points in 777’s operation.

Had 777 met those terms, Everton could now be in a similar situation to other clubs in their portfolio like Belgium’s Standard Liege and Brazil’s Vasco da Gama, both of whom are urgently looking for new owners after the Miami group’s collapse. Its Italian club Genoa, the first club it acquired in Europe’s top five leagues in 2021, were this week sold to Romanian entrepreneur Dan Sucu.

The delay in approving or rejecting 777 could have been crippling for Everton, who were reliant on monthly injections — in the form of loans — to pay the bills.

At the time, the debt reached nearly £1bn, factoring in £450m in shareholder loans that Moshiri was always likely to have to write off. As the search for cash got more desperate, the club became increasingly reliant on short-term, high-interest loans. Each failed takeover loaded more debt on, creating a further barrier for interested parties.

The reality, though, was that 777 needed Everton as much as the club needed it. 777 had tried and failed to raise capital via its football operation through Tifosy, and it was thought that the addition of Everton as a shiny new Premier League club in its portfolio would make that task much easier.

777 lent Everton money via RMF’s debt facility and kept up with their payment obligations until the end of last season. In that period, Wander and other 777 representatives regularly attended Everton games.

The takeover, which had long been on life support — kept alive by regular extensions granted by Moshiri — finally collapsed in June when 777’s purchase agreement expired. The regular complaint had been that Moshiri could not see the wood for the trees with the 777 deal, which had long looked doomed to failure.

A more pragmatic view, advanced by some with knowledge of the process, is that 777 kept up with the purchase agreement and helped Everton through a challenging period financially.

While they honoured their contract, Moshiri was unable to cancel it, certainly without incurring a significant financial penalty.

But when it became apparent 777 was not going to complete the transaction, he swiftly moved on.

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There was another scramble for Everton to find fresh investment at the end of the 2023-24 season, but this time Moshiri had choices — even if some of them were distinctly unappealing.

With rumours of financial meltdown swirling, the vultures circled. At least one offer made at that point almost pre-empted administration.

Towards the end of last season, Everton enlisted the help of financial advisors at Teneo in an attempt to plot a viable way through.

There were potential investors who put forward the view that administration could potentially be advantageous to Everton, clearing away burdensome debt and offering potential for a fresh start. With the team comfortably clear of the bottom three in the Premier League, their argument was that they could have taken the nine-point penalty that comes with administration and still avoided relegation.

But Moshiri and other club directors refused to countenance it. Moshiri needed to safeguard his investment, and administration almost certainly would have resulted in him walking away with nothing. There was an understanding that there is a human cost, such as job losses and reputational damage, that comes with such measures.

In repeatedly extending MSP’s loan repayment date and the 777 contract, he closed off that avenue — at least for a while longer.

The fear was always what, if anything, would replace 777 when its deal collapsed. But this time Moshiri had tangible options.

Several bidders had waited in the wings while the club ploughed on with 777, unable to make a play during the exclusivity period. There was interest from the Middle East, but more from America. Some potential bidders were deterred by the 777 debt, subsequently taken on by its main creditor A-CAP, a U.S. insurance firm.

Everton were more appealing than they had been even 12 months earlier, when MSP stepped away. They had retained their Premier League status, despite two separate points deductions for profit and sustainability rules breaches, and the new stadium was less than a year away from completion. Investors saw an opportunity.

Bell and Downing were the early frontrunners, and had been on course to strike a deal. Their offer, backed by MSD and brokered by Manchester firm Zeus Capital, centred on a mix of debt and equity.

MSD committed to a sizeable loan, secured against Everton’s new stadium, with Bell and Downing expected to provide around half of the £200m equity share. MSD was proposing to raise further funding through celebrity contacts willing to invest as minority shareholders alongside Bell and Downing.

The takeover, which was seen as the most viable option before TFG’s intervention, would have seen Bell and Downing in effect handed the operational reins of their boyhood club. But they were beaten to the punch by a late intervention from TFG, whose higher offer secured exclusivity with Moshiri.

TFG had long been keen on Everton. They were aware of the history and global following and saw it as one of the last great Premier League institutions on the market. While other, potentially more stable clubs were being touted around, it was felt Everton had untapped potential and a higher ceiling.

After years of trying and failing to build a new stadium at Roma, like others before them, the new ground on Liverpool’s waterfront was considered a major plus point. They admired the club’s work in the community.

Beautiful. 💙 pic.twitter.com/444Rw38BJA

— Everton Stadium (@EvertonStadium) December 12, 2024

But there was one hurdle they initially struggled to overcome.

The situation with 777 and A-CAP spooked potential investors, including TFG initially. Those two were (and still are) the subject of legal proceedings brought in New York by a number of claimants, including the UK firm Leadenhall.

Leadenhall alleged 777 had double-pledged assets to it as collateral on loans. It argued it was entitled to monies owed to ACAP and 777. The case continues in New York, with A-CAP having described Leadenhall’s claims as “baseless”.

After a period of due diligence, done by an army of lawyers, TFG decided there was too much risk and uncertainty around a deal to buy Everton — particularly while the loan to A-CAP was outstanding.

The Athletic has been told by sources with knowledge of the process, speaking anonymously to protect relationships, there was a suspicion that TFG had been given the sense from the investment community in the U.S. that it was overpaying for the club, as many believed it had done for Roma.

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TFG’s withdrawal from talks was a crushing blow for Everton, given an end had seemingly been in sight.

But Moshiri, through Deloitte, pushed on with alternatives.

Bell and Downing chose not to re-enter the fray, whilst a bid from Textor, the part owner of fellow Premier League club Crystal Palace, was seriously considered. While the American made progress in talks with Moshiri and very publicly stated his confidence during a press conference in France, where his Eagle Football Group own Lyon, in concluding a deal, he always had significant hurdles to overcome.

Premier League rules prevent owners from having shares in two clubs at any one time. Textor was looking to sell his Palace shares, but there was no sign a deal was imminent and Everton needed certainty.

The other issue was that he needed the agreement of at least four key stakeholders to complete a move for Everton. As well as Moshiri, Textor would have had to reach accommodations with existing lenders RMF, A-CAP and TFG. It made securing a new deal a considerable ask for any potential new investor, not just Textor.

While his presence around the table may have eventually forced TFG’s hand, they initially insisted on full repayment of their £200m loan to Everton in order to sanction the deal.

TFG had little interest in shares in Textor’s Eagle Football Group, one potential avenue for repayment, while he was looking to raise capital to invest in Everton through an initial public offering — in effect, a flotation on the stock market.

Had TFG not returned to the table, Moshiri would almost certainly have been forced to plough on with Textor’s bid. His Palace shares remain unsold.

In one sense, pulling out of exclusive talks with Moshiri worked in TFG’s favour. It remained in a strong position, away from the spotlight.

TFG never really went away. Its position as a significant creditor meant the group was in regular dialogue with officials and stakeholders, and kept abreast of new developments.

During conversations with other lenders, it became apparent there was a deal to do and TFG was the only one in the position to do it straight away.

Further legal guidance suggested there was indeed a way to resolve the A-CAP situation, and the U.S. insurer was increasingly open to doing a deal.

TFG walked away from talks before taking over Roma in 2020. Four years later, it repeated the trick with Everton.

TFG did to Textor what it had done months earlier to Bell and Downing. It could have sat pretty on its security, taking ownership of the club by default in the event of non-repayment of their loan next June. That is what some others involved in the process counselled them to do, but those close to the group said it was keen to get going at Everton and protect its investment.

Over the course of an intense weekend in September, a full agreement for Moshiri’s 94.1 per cent stake was reached, on terms only marginally better than before. TFG has subsequently provided further loans to Everton, said to be in the tens of millions, and now owns 99.5 per cent of the club through an additional share issue.

It took three months for TFG’s bid to receive regulatory approval. In that time, assent was needed from the Premier League, the FA and the FCA. The issue with A-CAP and Leadenhall was more complicated, but the takeover was allowed to proceed as the latter is yet to challenge it.

A-CAP’s debt has been restructured and is set to be repaid in stages, while RMF’s loan will be refinanced with an alternative lender at more favourable rates, ending the latter’s involvement with the club.

The last few months have seen TFG attempt to understand how the club operates and what is needed for it to succeed again. Officials from the group have been in regular contact with colleagues at Everton and visited club sites, including the new stadium.

Some have been present at games, although Dan and son Ryan Friedkin are yet to do so. There has been an early focus on maximising the commercial opportunities that come with the new state-of-the-art ground on the city’s waterfront.

A positive view has been taken of the role Everton’s threadbare senior management team, comprising interim CEO Colin Chong, and others like chief financial officer James Maryniak and chief legal counsel Katie Charles, have played in steering the ship through choppy waters. Maryniak and Charles in particular have been seen as unsung heroes, working tirelessly to find a positive outcome.

Credit has been given to Bell and Downing too for their loans and guidance at a crucial time. The prospect of Bell and Downing joining TFG’s new regime in some capacity has not yet been discounted.

Manager Dyche’s future, as well as that of director of football Kevin Thelwell, will need to be swiftly resolved, with both out of contract at the end of the season. The likeliest scenario at present is that TFG sort out the upper echelons at the club first, in the form of board and executive appointments, with decisions on the football side expected to come slightly further down the line.

Dyche, like others before him, has had his hands tied in the transfer market, with key players like Anthony Gordon and Alex Iwobi sold to balance the books. He has stated publicly in recent weeks that he is yet to speak to TFG.

There has been positivity from TFG around some of the work being done by the football department during tough times, but no firm decisions have yet been communicated.

Watts joins as exec-chair and, in an open letter to fans on announcement of the deal, highlighted a list of priorities for TFG including “strengthening the men’s first-team squad through thoughtful and strategic investment, cultivating home-grown superstars through Everton’s Academy, fostering a distinct on-pitch and commercial strategy for the women’s team and respecting the Club’s traditions and keeping Everton at the heart of the community”.

Ana Dunkel, TFG’s chief financial officer, also joins the board, while Chong remains in his post with the search for a permanent CEO, through executive recruitment firm Nolan Partners, ongoing. Further appointments are expected in due course.

Regardless of who is in charge there, the prospect of fresh — and much-needed — investment into the team will be greeted as a huge positive.

Moshiri, meanwhile, walks away having made a substantial loss. He receives a small sum on completion of the deal, again said to be in the tens of millions, with some deferred payments due further down the line.

Sources close to the former Everton owner have played down suggestions he will pocket as little as £40m from the takeover, but the overall sum he eventually stands to earn will nevertheless be a very small fraction of his £800m investment.

Football-wise, Everton regressed during his eight-year tenure. The search for funding became fraught, at times, but he has succeeded, at least, in finally selling to more respectable bidders who have shown early signs of wanting to clean up the mess. Other deals, including Textor’s, were better for him financially but TFG provided certainty and respectability.

Moshiri made many mistakes during his tenure as owner, but he departs having facilitated the build of a new stadium, mostly on time and budget, which has in turn played a key role in bringing in new investment.

One major impediment to progress at Everton has been the lack of finance and the debt situation, which has immediately been improved on day one of the takeover. With Moshiri having converted his loans to equity and other debt set to be refinanced on long-term, low-interest rates, that albatross has disappeared.

So too, seemingly, has what Moshiri once described as the “existential threat” to one of English football’s oldest and most established institutions.

Those at the embattled club can now breathe easy and, hopefully, look to a brighter future on the banks of the Mersey under new American ownership.

(Design: Dan Goldfarb for The Athletic. Photos: Getty Images)