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American businessman John Tector is threatening legal action by three investors who supported the acquisition of Olympic Lyonna after the French club was demoted from the top division due to financial difficulties.
Hedge fund billionaires Jamie Dinnan and co-investors Alexander Naster and Edward Eisler wrote in a text Wednesday, requiring that he is obliged to buy back $93 million in shares at Eagle Football Holding, a company that owns Lyon and two other football clubs, and that he would do so within a week.
The text confirmed receipt of the notification but rejected the proposal that the money was being paid to the three investors, adding that they “have no right to the contractual interests they currently claim.”
This dispute puts more pressure on the text and his club’s network. On Monday, he announced that he would partially sell his shares in Crystal Palace, the UK’s Premier League side. Lyon helped raise funds for Lyon, which was forced by regulators to develop plans to improve its finances.
In March, Lyon reported a net loss of 117 million euros in the first half of the fiscal year, and reported unpaid liabilities excluding money paid for the 445 million euros player transfer.
The text purchased Lyon in 2022 at a valuation of almost €900 million, including debt. It was the biggest acquisition in French football history.
The original purchase was funded primarily by over $400 million in funding provided by US investment company ARES Management and $75 million in funding from iconic sports management, a three-investment investment vehicle led by Dinan, founder of York Capital Management and co-owner of the Milwaukee Bucks NBA franchise.
The text purchased Lyon in 2022 at a valuation of approximately 900 million euros including debt © Pauline Figure/spp/Reuters
The contributions from Dinan, Knaster and Eisler were part of the agreement to integrate Eagle Football with the iconic special acquisition company. Dinan and Naster became executives of the Eagle, and the symbol acquired shares in the company.
However, the SPAC merger was cancelled in 2023, and in July of that year, Iconic supporters exercised the option they needed to buy back the stock, according to those familiar with the details. When this did not happen, they hired a Perera Weinberg M&A advisor to find a buyer, but never succeeded.
Following the relegation of Lyon on Tuesday, three Iconic supporters have texted letters threatening legal action if they do not buy back shares by July 2, people added.
Dinan, Knaster, and Eisler claim the text owes $93.6 million. The iconic comment was declined.
Textor said: “The symbolic obligation failed to comply with the obligation, including failing to provide a viable SPAC, the basis for involvement in the original location.
Earlier this week, the text agreed to sell its Crystal Palace stake to Woody Johnson, the owner of the New York Jets NFL team billionaire. The sale raises approximately $200 million. Some of it is allocated to help reduce Lyon’s debt.
He is also trying to raise money by listing Eagle Football in the United States. The group owns Botafogo, the Brazilian champion. Botafogo has been a huge success on the pitch, but faces disciplinary action over unpaid transfer fees.
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Lyon said he would appeal this week’s “unintelligible” decision to demote the club this week, saying that a fair contribution from Eagle shareholders eased pressure. “Through our appeal, we will establish the substantial cash resources that Olympic Lyon needs to maintain its place in Ligue 1,” the club said.
All French football clubs are suffering a sharp decline in television revenues as media rights auctions failed.
Textor previously sold other Lyon assets, including indoor arenas and women’s teams, and recently sold young offensive player Rayan Cherki to Manchester City, nearly 40 million euros.
