Everton points deduction twist: ‘Friedkin takes dramatic action’
Everton’s owners The Friedkin Group (TFG) will put equity into the club to avoid any further profit and sustainability (PSR) issues at Goodison Park.
That is the view of finance expert Stefan Borson, who exclusively told Football Insider the Premier League rules require new owners to keep the acquisition debt below 65 per cent.
Everton confirmed on 19 December TFG, which is spearheaded by Dan Friedkin, has completed its takeover after receiving approval from the Premier League.
The American billionaire, who also owns Roma, has acquired a 99.5 per cent stake in the club after bringing to an end Farhad Moshiri’s eight-year spell on Merseyside.
As per a Companies House submission on 19 December, Everton have now rescheduled existing loans with JP Morgan Chase & Co.
Sean Dyche’s side were docked eight points last season after breaching the Premier League’s spending rules.
Dan Friedkin wants to keep Everton debt low after PSR struggles
Borson revealed TFG will be looking to keep Everton’s debt low to improve their PSR situation.
He told Football Insider: “The Friekdin’s are well aware they will have to restructure the way the balance sheet looks with an eye on PSR because they need to spend money on the field.
“If they don’t structure the balance sheet right, they wouldn’t be able to do that, so they will sort that out.
“The Premier League rules require less than 65 per cent acquisition debt. It’s all quite complicated the drafting in the Premier League rules around this stuff.
“But what it does mean is a new buyer that comes in has to test the level of debt that they have used to acquire the club. On day one, on the six-month mark and on the 12-month mark, all of them have got to be below 65 per cent of the total deal cost.
“You can’t go in and put in hundreds of millions of debt and no equity. They are going to have to put in a very large amount of equity into the mix, so Everton fans should be comforted that they have to do that under the Premier League rules.
“But they are going to want to do it anyway because they are going to want to keep the level of interest that they are paying from a PSR perspective as low as possible.
“Clearly, the more they can put on the stadium the better.
“But in terms of the non-stadium debt, they are going to want to keep that as low as possible because that will impact their PSR calculation.”
In other news, Everton could land devastating new six-point deduction – expert.
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