Melbourne Victory shareholders will vote on Tuesday on a resolution that would pave the way for Miami-based investment firm 777 Partners to take up to a 70% stake in the A-Leagues giants.
The footballing arm of the private equity group initially bought into Victory on the eve of the 2022-23 A-Leagues season, acquiring a minority stake in the club in exchange for a reported $8.7 million. Bonza, a low-cost airline owned by the group's travel investment arm, also became the men's team's front-of-shirt sponsor as part of the agreement.
- Stream on ESPN+: LaLiga, Bundesliga, more (U.S.)
At the time, Victory chairman Anthony Di Pietro framed the sale as a strategic move to secure the club's future and provide access to its new partner's global scouting network and pathways for its men's and women's players.
He also revealed that the deal contained a pathway to majority ownership, approval of which would be voted on at a combined EGM/AGM on Jan. 31.
If the motion is passed, it will give 777 Partners the option -- should it choose to exercise it -- to take on a greater stake, on favourable reported terms, through various means of investment and timeframes over the next five years.
"777 Partners is already a shareholder in the club," Victory managing director Caroline Carnegie told ESPN. "They hold 19.9% of the equity; they're not the largest shareholder but they are a big shareholder.
"At the end of the month, there'll be a proposal put to shareholders to give 777 Partners the option to increase their equity in the club over time. And ultimately whether that's accepted will be a matter for the shareholders at that EGM."
Returning to Australia last week after meetings in Miami, Carnegie was adamant that Victory's day-to-day footballing operations would not be affected by any possible change in the club's ownership structure, and that its name, badge and colours would not be altered.
The executive said the club had engaged Tifosy Ltd, a U.K.-based consulting firm co-founded by the late Italian striker Gianluca Vialli, to run a competitive process that brought together Victory and 777 Partners, declaring the group presented as an "aligned investor".
777 Partners has a history of buying into existing clubs, also owning majority stakes in Italian Serie B club Genoa, Brazilian giants Vasco da Gama and Spanish LaLiga outfit Sevilla. Last October, it purchased a 64.7% controlling stake in German Bundesliga club Hertha Berlin.
"One of the things that we wanted to do to make sure that Victory is always in a strong position and growing and that we were sustainable -- obviously football is first but that was sustainable, regardless of our on-pitch results -- is making sure that we had a very strong capital base," Carnegie said.
"But that we had that from a strategic partner and investor who could also provide a lot of other opportunities for the club in terms of strengthening our commercial networks but also providing a true pathway for both our men's and women's squads
"When we strategically looked at how we would go about that, we had our sort of list of drivers which included making sure that Melbourne Victoria was always Melbourne Victory.
"So it certainly wasn't a case of just looking at the finances; it was providing that overall advantage to the club to help us grow through that process.
"And then I think in the reverse, 777 Partners is obviously in an acquisition phase around the development of many of its verticals including its football group."
Victory's balance sheet was hit hard by the COVID-19 pandemic, recording a $6.7 million loss in FY22 and, according to reports, having its auditors declare there was a "material uncertainty" it could continue as a "going concern" due to higher expenses than most other A-Leagues club.
Major shareholder Mario Biasin, who owned 26% of the club and was co-founder of its previous major sponsor, Metricon, passed away in May 2022.
There have been rumours that the club was in debt to A-Leagues administrators the Australian Professional Leagues (APL), but Carnegie denied this, saying "we have not been and we are not in debt to the APL".
Sources have told ESPN that the club did receive advance payment of its standard league distribution due to the effects of COVID but this did not create any ongoing obligation.
The club was recently fined more than $500,000 as a result of the violent pitch invasion at last month's Melbourne Derby; Victory fans stormed the field and injured five people, including City goalkeeper Tom Glover.
Striker Nicholas D'Agostino was transferred to Norwegian Eliteserien club Viking FK last week for a sum reported to be more that $1 million; Victory declined to comment on the figure, but said the transfer had been in the works prior to pitch invasion and was unrelated to the sanctions.
While 777 Partners will take Victory's majority ownership out of Australian hands for the first time, their investment, combined with a capital raise from the club's existing shareholders undertaken last year, has Carnegie declaring the club's viability is secure.
"The future of Melbourne Victory is not in doubt," Carnegie said.
"Our future is really bright.
"Everyone had difficulties coming out of COVID. We finished sort of bottomed out [in income] FY21, as everyone knows.
"There's a process because our football is always first here to get back to where we want to be, but absolutely our future is looking bright. There's a journey, but it's looking bright.
"There's absolutely a plan, and that plan does include profitability. But it's over time and it's a journey. At the end of FY21, we anticipated a three-year journey to get us back to where we needed to be and then grow from there on moving forward, and we're on target with that."