John Textor was hailed as a saviour when he bought Brazilian football team Botafogo last year. “I go down to Rio and I’m treated like a king everywhere I go,” he said of his early days in charge.
But after selling a player in January to Olympique Lyonnais, also owned by Textor’s Eagle Football, fans felt betrayed and the US businessman started receiving death threats.
“Off one player deal I had to change my phone number,” he said. “You wouldn’t believe how quick and how reactive things can be.”
A relative newcomer to football, Textor is one of a new breed of club owners seeking to buy into teams across different leagues. The multiclub model is the hottest trend in the sport, with more than 180 teams now part of a broader network, according to football’s European governing body Uefa.
Alongside Lyon and Botafogo, Eagle owns Belgian tier-two team RWD Molenbeek and about 40 per cent of south London Premier League side Crystal Palace. After enlisting a number of Wall Street backers, the company plans to float in the US in a first for the industry.
Textor’s background is not sport but virtual reality and visual effects — his past business ventures include bringing rapper Tupac Shakur back to life as a hologram. The 57-year-old stresses that even now he is not an “investor”, preferring to bill himself as a “builder of companies”.
“There’s no more offensive word in the English language than ‘investor’ to me, because that just says your worth and your contribution can only be measured in money,” he told the Financial Times.
Textor has nevertheless joined forces with a number of financiers. At Crystal Palace he sits on a four-man board with Apollo co-founder Josh Harris and Blackstone executive David Blitzer, alongside club chair Steve Parish.
US investment group Ares provided about €400mn of financing for the Lyon takeover and now has two board seats at Eagle. The $100mn equity portion of the deal came from Jamie Dinan, founder of hedge fund York Capital, and Alexander Knaster, the founder of Pamplona Capital who used to run the now sanctions-hit Russian lender Alfa-Bank, through their company Iconic Sports Management, alongside tech-focused fund Elmwood Partners. Dinan and Knaster sit on the Eagle board.
Producing young players — a process Textor calls “asset creation” — is the thread running through Eagle’s clubs. Textor’s money helped complete the new academy at Crystal Palace, based in one of the world’s most productive cities for young talent, while Molenbeek and Botafogo are well placed to find players in Brussels and Rio de Janeiro, respectively.
Player trading can be lucrative. Portugal’s Benfica, in which Textor once tried to buy a stake, has sold players worth €840mn in the past five years, according to Transfermarkt, at a trading profit of €480mn, the highest in Europe. Lyon ranks third, generating €272mn over the same period.
But Textor’s strategy is far from unique. There are now more than 70 multiclub ownership groups in football, according to Deloitte, many of them built on the same thesis of smart scouting and player trading.
Ares, which raised $3.7bn last year for a sport and entertainment fund, saw the opportunity in Eagle to join a “pre-wired, multiclub strategy of some great clubs with a great platform”, according to partner Mark Affolter.
Based on 2021-22 accounts, the combined revenue of Eagle’s assets would rank it in the top 20 of the sport’s richest clubs — just behind Italian champions AC Milan, bought by US investors last year for €1.2bn.
“There’s a lot more low-hanging fruit in European football,” said Dinan, who is also a co-owner of the Milwaukee Bucks basketball team and has joined the Lyon board. “I love the assets John has.”
As part of the Lyon deal, Eagle put agreements in place for a potential merger with Iconic Sports Acquisition Corporation, a New York-listed blank-cheque company sponsored by Dinan and Knaster and managed by London-based boutique advisory Tifosy. A successful listing would make it the first multiclub football business to go public, with a tentative valuation of $1.2bn, according to SEC filings.
Textor sees public markets as an antidote to the wealthy states and individuals who control many of football’s top clubs. “It’s not the Wall St devil we’re talking about,” he said. “It’s a form of ownership which closely approximates community ownership.”
However, Textor’s business record and lack of experience in sport have raised some concerns. He was involved in the 2006 buyout of Digital Domain, becoming chief executive of the production house responsible for the sinking of the Titanic in James Cameron’s Oscar-winning 1997 film.
A year after listing on the New York Stock Exchange, the company ran into financial trouble and slid into bankruptcy in late 2012. While Textor blames this on unscrupulous hedge funds, others at the time pointed to his aggressive growth strategy.
His wealth eventually returned. In 2020, Textor merged one of his companies with fuboTV, a US sports streamer aiming to be the “Netflix of soccer”, becoming executive chair and the largest shareholder. He exited six months later in the midst of a stock market rally that would give the company a peak market capitalisation of $8bn. The share price has since tumbled and it is now worth less than $400mn.
Textor ascribes his reinvention as a football entrepreneur to the dark days of past failures. After the collapse of Digital Domain, he lost his fortune and his “fake friends vanished”. He found solace coaching a kids’ soccer team in Florida, and became a football obsessive.
“I was driving the bus, I was doing the laundry for uniforms in between games,” he said. “I’m not trying to make this sound like a sob story — but it is what it is. I think this football thing kind of saved me.”
The purchase of Lyon, by far Textor’s biggest move in football, has attracted two common criticisms from rivals and investors — that he paid and borrowed too much. The €800mn price tag, including the club’s roughly €315mn in debt, was agreed in June last year when interest rates were still low and set a record in French football by some margin.
Lyon, the dominant force in France’s Ligue 1 in the early 2000s, has not won the league since 2008. The team currently sits ninth in the table.
Textor said “only an idiot” would think he overpaid. He pointed out that the debt — structured as preferred equity — was secured against his shares in the company, not club assets, and that he wanted Eagle to be debt-free within two years.
In the short term, the focus is on building the company by hiring a chief executive and other senior management for its London headquarters.
Yet fans across the four clubs have expressed unease. After an FT report on the listing plans, Crystal Palace supporters held up banners at a game denouncing “stock market gambling”, while Lyon fans have complained that the spending promised during the takeover has not materialised. Even at high-flying Molenbeek, some fans have complained that the club is losing its Belgian identity.
Textor understands the scepticism, but urges patience.
“It’s easy for people to say Americans are bad, multiclub is bad,” he said. “I get it — fans don’t know me and they don’t know my heart. They think I’m a money guy.”