London and Miami-based investment firm 777 Partners, currently awaiting approval for its acquisition of Everton Football Club, perceives owning football clubs as a strategic avenue for identifying underpriced targets in the sports tech sector, according to revelations from The Standard.
John Jeffery, 777's head of Europe, suggested that potential targets could include companies serving as a 'salesforce for football' or providers of statistical data. Operating its European division from Mayfair, 777 already possesses clubs in five other countries and owns the London Lions basketball team. The firm agreed to purchase Everton in September, but the deal's finalization has been prolonged, pending approval from the Premier League.
Jeffery outlined four main benefits of venturing into football ownership, including reduced revenue volatility, player transfer flexibility between clubs, and the opportunity to attract directors suited to specific budget requirements. Additionally, Jeffery highlighted the firm's capability to acquire sportstech companies at discounted prices, leveraging its intimate market knowledge gained through active involvement in football ownership.
777 has previously employed a similar strategy in sectors like insurance, acquiring core sector entities before targeting undervalued adjacent companies. Jeffery emphasized the firm's focus on ensuring short-term financial stability for each acquired club before pursuing further acquisitions or developing proprietary products to address market gaps.
While awaiting Premier League approval, Everton has faced financial scrutiny, and 777 has been embroiled in legal disputes with creditors. The extended approval process has resulted in a six-point deduction for Everton, potentially jeopardizing their league standing.
Reports suggest that the Premier League may reach a decision on Everton's fate next week. Failure to secure approval could cast doubt on the future of the debt-laden club.
Questions have been raised regarding the source of funding for 777's acquisition, with allegations that insurance premiums were utilized for sporting investments. Jeffery acknowledged the use of such funds but clarified that insurance investments are managed by an independently regulated entity.