Everton face a significant blow to their financial aspirations as MSP Sports Capital has exited negotiations over a minority stake in the club, per The Athletic.
Having signed an exclusivity agreement in May, the New York-based investment group had been in talks with Everton to inject up to £150 million in convertible debt, equating to approximately 25% ownership in the Merseyside club.
Around £100m was designated for the Everton Stadium Development Company, a subsidiary established by club owner Farhad Moshiri in 2017 to oversee the construction of the new Bramley-Moore Dock stadium.
Despite the promising trajectory, the deal has faltered as the exclusivity period lapsed and MSP Sports Capital retreated from the discussions.
The stumbling block to the deal emerged from an existing Everton lender, Rights and Media Funding Limited.
The lender’s reservations were rooted in concerns that MSP’s financial contribution did not proportionately align with the equity it sought.
This setback is a substantial blow for Everton, a club grappling with financial difficulties and a challenging start to the Premier League season, where they currently languish at the bottom after losing their opening two matches without scoring a goal.
However, MSP Sports Capital is still pushing forward with a £100m loan to the stadium company, albeit without the convertible debt aspect.
This manoeuvre will enable Moshiri to repay the £40m bridging loan borrowed from businessman Andy Bell earlier in the year.
The loan will be a crucial step toward financing the completion of the Bramley-Moore Dock stadium, although uncertainties about securing the remaining funding persist.
With MSP Sports Capital’s withdrawal from the investment scene, Moshiri is exploring alternative avenues, including revisiting discussions with Miami-based investment firm 777 Partners.
Whether these dialogues will yield more promising results than their earlier counterparts remains to be seen.
Amidst Everton’s financial turmoil, the club is simultaneously navigating a tumultuous start to the 2023/24 season.
Having narrowly avoided relegation battles in prior seasons, Everton supporters are growing concerned about their team’s continuous flirtation with a drop to the Championship.
The club’s financial struggles are compounded by losses exceeding £400m from 2018 to 2022 and ongoing investigations into potential violations of the Premier League’s spending regulations, with a verdict anticipated later this year.
