The wave of American capital

Another American private investment fund, 777 Partnershas signed an agreement to acquire 94.1% of the shares of one of the historic clubs of English football, the Everton. The transaction, which is expected to close in the last quarter of this year, is still subject to approval by the Premier League and the regulatory entities, but it represents confirmation of the interest of American private capital to invest heavily in premier as in other English leagues.

The wave of the search for profits and profitability in the most followed championship on the planet is growing and growing, once there is no limit, and there are already ten clubs in premier that have American shareholders or investors.

The phenomenon also affects the lower championships of English Football League (EFL) -(Championship, League One and League Two)-. The Americans also now have three teams from National League and four of the 12 Scottish Premiership clubs, all owned by US-based private equity groups. He City of Lincoln is the latest in a string of recent acquisitions, such as Crawley Town, Walsall, Gillinghamand Wrexhamthe Welsh club bought by Hollywood actors, Ryan Reynolds and Rob McElhenney, which gave good advertising exposure to all US operations, and achieved the long-awaited promotion to League Two last season.

For clubs with a large debt of gratitude such as the historic club Everton and in a very difficult situation on a sporting and financial level, the arrival of American money is almost a miracle for the survival of the economy and sports. Economic analysts of city English estimates the operation at more than 635 million euros, but warns that the future of the ‘Toffees’ may be at risk, unless this proposal to take over the controversial American investment firm is approved. 777 Partners, involved in some litigation. Debt and cash flow problems Everton has increased significantly since the owner, Farhad Moshiri, he stopped supporting the club, and a recent loan from the American fund took the total outstanding loans of more than 400 million euros.

The ‘Wrexham effect’

The sale of Everton It comes as a solution from the current owners to the economic difficulties of the past years, where the club has invested in the construction of a new and iconic stadium, on the banks of the Mersey, in Bramley-Moore Dock. The project is linked to a whole economic and commercial regeneration of Merseyside, where 777 Partners saw an opportunity for economic profitability. The company that holds the club Miami From now on, he will not only direct the completion of the new stadium, but also look after commercial operations with other clubs in which he has a shareholding. Genoa, Vasco da Gama, Hertha BSC, Standard Liege, Red Star FC, Sevilla and Melbourne Victory.

Since having a club Premier League This is a status reserved only for billionaires, the EFL and the National League They have now become fertile ground for investment, with the dollar-to-pound exchange rate and the growing popularity of soccer in the US all contributing factors. English football represents a low-cost entry point. A fund can buy a club with a 100-year history for less than the cost of a franchise in the US minor leagues.

The publicity around Wrexham has been part of the phenomenon, but also the prospects offered to clubs should they reach the Premier League, and merge. The co-owner of Ipswich Town, Brett Johnson a Rhode Island-based entrepreneur, acquired a majority stake with the GameChanger 20 Ltd. fund. Thanks to his strong investment, Ipswich Town have just knocked Wolverhampton out of the Carabao Cup and are a candidate for promotion to the Premier, their long-awaited goal.

He ‘Wrexham effect’ It became real and attracted more American investors thanks to the documentary series broadcast by Disney+. His ability to market Wrexham, transforming a small local entity into a global brand, is the reflection of how to increase the value of a club in a short period of time with a relatively low investment, compared to the sum involved today of buying a Premier club.

There are several examples, such as sports couple JJ Watt and Kealia Ohai, and their investment in Burnley, which they capitalized on by achieving promotion to the Premier last season; the actor Michael B. Jordan, the shareholder of Bournemouth, or the seven-time champion of the SuperBowl, Tom Brady minority co-owner in Birmingham.

In many ways, club ownership is not a comfortable task. EFL clubs are expected to lose 400 million this season, so staying in business, waiting for good results, takes time, risk and a lot of smart investment. But the audience favors, commercial exploitation and the millionaire’s dream premier.

With the sale of Everton, there are fewer and fewer English owners, and US investors now have control of the ‘big’ four, Chelsea, Arsenal, Liverpool and Manchester United, although the latter is in still sales process. The irony of all this investment fever is to think how a modest Luton Town acts as a model of how to reach the elite without debt, living with great humility among the great, and without reach any private funding, only through the ownership of former players and local investors. A strong and proud exception.