The Esk: Potential 'Due Diligence Issues' for Dan Friedkin's £800m+ Everton takeover

777 Partners represent “potential but not unresolvable” due diligence issue for Dan Friedkin ahead of his proposed Everton takeover, according to The Esk.

Writing on his website on 16 July the Toffees analyst estimated the total cost to the Roma owner and his group of replacing Farhad Moshiri could be “well in excess” of £800million once the necessary investments in the new stadium and the squad are factored in.

But as he carries out due diligence checks it is the debt to 777 which has now been taken over by lenders A-Cap [The Athletic, 8 June] which could prove to be a stumbling block.

The Josh Wander-fronted group put over £200m in loans into the club during their own failed takeover attempt last season [Sky Sports, 23 April] before their business ran into serious issues and it is the uncertainty over their status which now represents a tricky variable.

The Esk wrote: “It should be noted that there are potential but not unresolvable due diligence issues around the status of the 777/A-Cap debt given their own particular solvency, legal and ownership status which may impact the final settlement figure with those creditors and their representatives.”

Farhad Moshiri tried to sell Everton to 777 before Freidkin Group

Chaos at 777 will not have been news to Friedkin when he made the winning takeover bid to Moshiri so the hope will be that he is prepared to deal with the extra complications that might bring.

He has already paid off one major debt to MSP Sports Capital [Liverpool Echo, 24 June], which proved to be a crucial step which Wander and company could never clear.

And with the hundreds of millions that a deal is set to require even with Moshiri only receiving minimal return on his actual shareholding Friedkin will likely be expecting a huge figure either way.

777 no longer have control over their football operations, according to Josimar on 10 July, and the situation illustrates what a lucky escape Everton look to have had in not becoming part of that equation.

A-Cap are set to remain in the picture in terms of the Toffees future as they look to recoup their loans but logically they would surely see a club under the ownership of Friedkin as a safer bet than Moshiri.

So the fact that 777’s unsuitability to own Everton remains an ongoing factor in Friedkin’s seemingly far more appropriate bid is certainly unwelcome but does not appear to be setting alarm bells ringing at this stage, but does demonstrate why the due diligence process is not a formality [Paul Joyce, 9 July].

In other Everton news, a club is now interested in selling the new top Toffees target amid transfer talks.

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