Everton FC’s Russian Connections Could Hurt The Club And Its Owner

The impact of Putin's invasion of Ukraine has caused one of the top clubs in the league to explore a possible sale. Is it possible thatEverton FC are facing scrutiny?

It's a question that supporters of the club may have to consider if majority owner Farhad Moshiri's Russian connections attract the attention of the British government. Since meeting in the 1990s, Moshiri, an Iranian-born British billionaire with a net worth of $2.9 billion prior to the Russian invasion, has worked closely with Usmanov, serving as a minority partner on multiple projects. He has invested in several Russian companies through his holding company USM, including mining and steel manufacturer Metalloinvest and wireless communications outfit MegaFon. The pair invested in the club before the owner bought the team.

The European Union, the U.S. and the U.K. have imposed asset freezes and travel bans on the Russian billionaire because of his alleged ties to Putin. The Dilbar, his 512-foot mega-yacht, is in limbo after his villa in northern Sardinia was reportedly frozen by Italian authorities on Friday. There are other Russian billionaires facing political pressure. On Wednesday, Roman Abramovich said he would donate the proceeds of the sale of his club to the victims of the war in Russia. The Los Angeles Lakers and Dodgers are owned by billionaires Hansjoerg Wyss and Todd Boehly.

Moshiri and his club are not close to his partner. On Wednesday, the club released a statement saying that it had suspended all commercial sponsorship agreements with Russian companies USM, MegaFon and Yota. He reduced his share in the group to 5% in the past 18 months. USM didn't comment. Requests for comment were not responded to.

If this invasion continues, it is possible that the authorities will go deeper into that network and ask Moshiri to step aside as well.

In the last three fiscal years,Everton has lost $350 million and has stayed afloat largely due to the deep pockets of its owner. Since taking over, Moshiri has given out a number of interest-free loans and the club owes him a large amount of money. According to The Athletic, Moshiri injected another $130 million and raised his stake to 94.1%.

Complicated matters are how intertwined the business has been with Usmanov. USM and MegaFon are key shareholders in the club, but they are not known to have any shares in the club. The USM purchased a first-rights option to name the stadium. According to the Financial Times, Usmanov brokered a deal to bring Carlo Ancelotti to Goodison Park.

There are other clubs in the Premier League that kick out Russian sponsors. Manchester United dropped its deal with Aeroflot last week. The loss of revenue could be a critical blow.

Short of a government intervention, Moshiri's personal finances are not in immediate danger. He has a large cash pile on top of his equity in the club.

If you have no money coming in, you might not be able to.

Forbes Russia has additional reporting from David Dawkins.

The exchange rate of Great British Pounds to U.S. dollars on March 6, 2022, was more than three times the rate of the previous day.