Trouble Brewing: 777 Partners Facing Challenges at Standard Liège

It is a banner which was deployed by the Ultras after the defeat at Westerlo (2-1), near the Maurice Dufrasne stadium, with the following words “777: 28/78 Your record is as high as your incompetence! !!” Nearly two years after the takeover of Standard, 777 Partners is an increasingly contested shareholder.

Not a match goes by without Liège supporters demanding the departure of the American group, also involved as owners at Hertha Berlin, Genoa, Vasco da Gama, Red Star, Victory Melbourne and Seville.

In recent weeks, the Miami-based company, led by Josh Wander, has been the subject of questions about its real financial strength. Obviously, these questions concern the future of Standard and the granting of its license for next season. Sunday, after the defeat at Union (2-1), Pierre Locht, the CEO of Standard, reiterated his confidence in obtaining the necessary sesame. The commission is studying the files submitted to it in March and, at present, no light is, it seems, red.

777 Partners disputes the amount of the tranche it owes to Bruno Venanzi

But the procedure has barely started and payment delays, which the Liège club has been accustomed to lately (salaries, suppliers), or other discoveries, could complicate the matter. Regularly, the rumor comes up according to which Bruno Venanzi, the former president, could recover Standard if 777 Partners does not honor the payment of the second of the three installments of the buyout, scheduled for April 20.

Bruno Venanzi and Josh Wander, in Sclesin, during the handover of Standard. ©BELGA

The American owners deny that such an agreement was signed. They are contesting the amount owed to Venanzi, due to the development of old files which had not been completed at the time of the sale: tax adjustment in the wake of footgate; dispute with Alexandre Grosjean, the former general director; payment of TV rights incomplete since negotiated with the German bank Raisin Bank.

A loan to repay?

Will the discussions between the lawyers of the two parties end in court? It’s not impossible. Can this interfere with the granting of the license? As long as it concerns 777 Partners and Venanzi, no, the commission is told. But if some missing payments put the club in difficulty, or if the accounts are blocked again, as has been the case in the recent past, that would be a very bad thing…

However, it is said that the former president, who does not wish to take over the club – in an executive manner at least – but watches over its interests, lent €3 million to 777 Partners, independently of the sale, and that he has not yet recovered the full amount. Other suppliers, who are not paid, could also come out of the woodwork to assert their rights. But on the side of 777 Partners, confidence remains essential, as on the other files which occupy it internationally.

Everton, a buyout conditioned in particular by the loss (or not) of points

And they are many. The first is the takeover of Everton. After an agreement was sealed, in mid-September, with Farhad Moshiri, to obtain 94% of the shares of the Liverpool club, the Premier League has not yet given the green light, more than six months later. This delay has two reasons: the first relates to the financial resources presented by 777 Partners.

Unlike Belgium, where the continuity of the club must be guaranteed from season to season, the English supervisory body requires continuity over three years on a financial level. Several elements were of concern and required the presentation of additional documents. But Josh Wander and his team will soon be able to explain themselves to Premier League officials, according to the British newspaper The Times.

The reinsurance branch which insures club purchases…

Furthermore, it appears that if the procedure took longer, it was also due to the threat of losing points, for Everton, due to spending more than authorized – a fact independent of 777 Partners. At the end of the procedure, the sanction was reduced from 10 to 6 points last week. If it had been maintained, and the effect was Everton’s move to the Championship, the value of the club would not be the same.

But this episode is one element among others in this file of the takeover of Everton. Because there are many American problems, according to several investigative media. Josimar, a Norwegian media outlet, has regularly published articles questioning the value of the group, financed largely by a subsidiary, 777Re, a reinsurance fund based in Bermuda, which indirectly enabled the purchase of the clubs.

…but loses an important supplier (A-CAP)

However, the rating of 777Re was lowered by an independent supervisory authority (AMBest) due to investments deemed to be risky. And this Thursday, Kenneth King, the boss of A-CAP, an insurance and investment company which largely participated in the financing of 777Re, announced the withdrawal of his company, to protect it from turbulence, according to The Athletic.

This withdrawal is a serious source of financing less for 777 Partners which, as a reminder, wishes to raise the equivalent of €200 million to advance its football branch. How ? This is another question, which will become complex, especially if Everton is not integrated.

Cascading departures

A certain instability is also affecting the American ranks, to the point that, according to Semafor, an American media outlet, the group’s financial director, Damien Alfalla, has resigned, while the procedure for the takeover of Everton has not yet been finalized. and that several questions accompany the American group, whose sporting (and financial) affairs in its other clubs than Standard are not happier.

Josh Wander was at Everton around ten days ago. But he is hardly present in Liège. ©Peter Byrne

If Johannes Spors and Don Dransfield, the sporting and general directors of the football branch of 777 Partners – based in London -, regularly come to watch Standard’s home matches, the same cannot be said of Josh Wander. The group’s CEO, in London in recent weeks for the Everton file, has not come to Liège for several months.

An absence, and a silence, which further blurs the relationship with Liège supporters, who consider 777 Partners as an increasingly less credible partner. What will the licensing commission think? The response is expected during the month of April.

How much was Standard bought back?

When the takeover of Standard by 777 Partners was made official, almost two years ago, the amount circulated was around €50 million. It seems that this amount was valued well above what the American company paid, for a takeover divided into three parts: Bruno Venanzi’s shares, estimated at just over €10 million; the takeover of the stadium property, for €11 million; a recapitalization, which was to be of the order of €15 million, as indicated in a document signed by 777 Partners when Standard passed into American hands.

But the shareholder instead proceeded with capital increases of €5 million, hoping that the local management would initially generate profits through sporting results and transfers. If he has injected up to €40 million since he arrived at the head of the Liège club, and he has sent a letter of comfort to the licensing commission to ensure the continuity of the club, 777 Partners has without doubtless missed a first opportunity to start his adventure on the banks of the Meuse, in spring 2022.

Behind the scenes, in Sclessin, we are in fact slipping that a larger injection, from the first days, could have facilitated the recovery, in a sporting context weighed down by a 2021-22 season of all (bad) records. In the meantime, the losses remain significant (more than €20 million) and the sporting results are not keeping up.

2024-03-01 06:04:00
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