777 Partners is an American investment company that owns several European football clubs, including Standard Liège and Red Star FC. But AS Saint-Étienne narrowly avoided falling into the hands of this group. While Bernard Caiazzo, former president of ASSE, recently explained that the Saint-Etienne club had escaped the worst with 777 Partners, others were not so lucky… A French club is one of the victims.
“Two and a half years ago, we had made good progress with the 777 Partners group. But there was a leak to the press. They broke off negotiations and moved towards Standard Liège. In the end, the shareholder was not paid, the club is in a catastrophic situation, like all the other clubs of 777″declared Caiazzo last June at the time of the sale of ASSE to Larry Tanenbaum. This decision allowed Saint-Étienne to avoid a situation similar to that of Standard and six other clubs, whose finances are today ‘today on the brink of the abyss.
ASSE escapes the worst!
Caiazzo also recalled another episode, when the Saint-Etienne club was looking for a buyer after its descent to Ligue 2: “Two years ago, when we went down, we were also well advanced with (David) Blitzer, which was the meaning of our press release at the end of the play-off lost against Auxerre. Until they told us that they did not want to keep the management of the club and make a social plan. There, we were the ones who said stop. »
Words which confirm that if the negotiations with these foreign investors had materialized, ASSE could simply have foundered. And these are the same dangers that several clubs in the 777 Partners portfolio are facing today, including Standard de Liège and Red Star FC.
777 Partners: virtual bankruptcy and clubs in crisis
As the Josimar website indicates, the finances of 777 Partners are today in a critical situation, with an alarming report on 777 SDL, the parent company which notably owns Standard de Liège and Hertha Berlin. Recent accounts reveal a massive level of indebtedness, with 160 million euros in debt and 52 million in losses, resulting in negative capital of 43 million euros. In other words, 777 SDL is virtually bankrupt. This situation does not directly concern the accounts of the clubs themselves, but it reveals disastrous management which risks dragging them down.
The shareholders of 777 SDL, however, announced measures to rectify the situation, in particular by converting 142 million euros of debt into capital by the end of the year. This maneuver aims to reduce debt and regain positive capital, but it will not be enough to add value to the company. Creditors will have their debts converted into shares, temporarily relieving financial pressure, without solving the company’s structural problems.
Standard Liège and Hertha Berlin in free fall
Among the clubs affected by this crisis, Standard Liège is one of the hardest hit. In the space of a year, the value of the club and its stadium has been halved, going from 59 million euros at the end of 2023 to just 32 million today. This devaluation, certified by a company auditor mandated by 777 SDL, reflects the extent of the losses suffered by the club. In addition, Standard’s sporting situation remains fragile, with the club now one point away from the play-downs after a third of the season. Sportingly, the results fell short of expectations, and the financial pressure only made the situation worse.
Hertha Berlin, another flagship of 777 Partners, is also in turmoil. The German club recorded a pharaonic operating loss of 100 million euros between 2022 and 2023, while its value fell by 25%. These two loss-making clubs are weakening the entire financial structure of 777 SDL, which is struggling to turn things around. And the contamination of these losses affects the other clubs in the group.
Red Star FC seeks new owner
Red Star FC, another club in the 777 Partners portfolio, is also in serious trouble. Bought in 2022 for 19 million euros, the Ile-de-France club is looking for a new owner, a process initiated by its leaders well before the summer of 2024. In fact, the Red Star had started negotiations with the group Texan investment Todd Interests, advised by former French international Peguy Luyindula. However, the exclusivity period which linked the two parties expired at the end of July without an agreement being reached, the Moelis & Co bank having deemed the buyout offer insufficient.
Other investors have expressed interest, including Steve Pagliuca, owner of Italy’s Atalanta and the NBA’s Boston Celtics. The due diligence process is well advanced, although no concrete agreement has yet been signed. At the end of August, however, Red Star affirmed that the club was in a healthy financial situation, far from the bankruptcy which threatens other clubs under the leadership of 777 Partners.
However, this active search for a new owner is becoming more and more pressing. Red Star, currently in sporting difficulty with a 15th place in Ligue 2, must quickly find financial and institutional stability to avoid falling into a situation similar to that of Standard Liège or Hertha Berlin.
A dark future for 777 Partners clubs
The financial structure of 777 Partners resembles a game of Russian dolls where each entity weakens the next. The debts accumulated by clubs directly impact the companies that hold them, which in turn contaminate other companies in the group. This cascade of debt has created a generally worrying situation for the entire 777 Partners empire, accentuated by legal investigations opened in the United States for suspicion of money laundering.
Standard de Liège, despite some hopes at the start of the season, finds itself plunged into a financial and legal crisis which could discourage any potential buyer. As for Red Star, the search for a buyer must accelerate to prevent the club from following the same path. The turbulence around 777 Partners and the uncertainty that reigns over its clubs cast a shadow over the future of several teams, which are fighting not only on the field, but also behind the scenes for their survival. Clearly, ASSE has indeed escaped a sporting and financial cataclysm!
