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Business as usual after Omonia failed takeover

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It’s business as usual for champions Omonia’s wealthy owner Stavros Papastavrou after a takeover deal by Cypriot expat billionaire John Christodoulou suddenly collapsed.

Monaco-based Cypriot billionaire Christodoulou was set to take over Omonia FC in a deal worth around €28 mln, from the current major stakeholder, New-York based Papastavrou.

“We had never stopped doing our job because we were in talks with Mr Christodoulou,” said Papastavrou.

“This is what we will be continuing to do from now on,” he said, adding that as a businessman, he knew that “in such cases, the odds of sealing a deal are always slim”.

The reason behind the surprise collapse of the takeover was the unwillingness of the club to see the initial management deal with Papastavrou altered, as per the wish of Christodoulou.

According to the initial deal, Papastavrou, 54, had taken on €9.5 mln of the club’s €15 mln debt, promising the team would receive €5 mln every year for transfers and the payroll.

However, according to Papastavrou, the thorny issue was agreeing that the main stakeholder would sell his shares to Omonia fans after five years.

“I agree with Mr Christodoulou on this point.

“A fan buying shares from the owner would not make sense as these shares would have no value.

“Also, the deal foresees that after 20 years, the company dissolves itself, and the football team is returned to the (athletic) club.”

Papastavrou said he called off the negotiations, as he saw that Christodoulou’s persistence to alter the management agreement would eventually lead the negotiations to a dead end after a couple of months.

He was reportedly looking for a way to disengage from the club due to his involvement in the banking sector in the US.

His incursion into the banking sector, and the fact he is based in the United States, have made it difficult for him to remain involved in running the club.

Due to the rapid growth of his business activities in the US, Papastavrou is faced with legal obstacles that forbid him from owning a sports club abroad.

According to US law, venturing into the banking sector excludes major shareholders from owning shares of a foreign club.

Papastavrou confirmed that he had applied to take over a banking institution in the US; it was still unclear whether owning a club overseas would be a legal hindrance.

“My lawyers and accountants have asked authorities in the US to tell us if owning Omonia would be an issue.

“From what we know, there is no way they will say it is.”

“Even if this is the case, there are always alternatives”.

Asked if he would be willing to sell to another buyer, Papastavrou said that there is no chance for another buyer to come forward so soon.

Property tycoon Christodoulou just happened to come along as his team was looking into legal obstacles to owning a bank in the states.

Following the deal’s collapse, Omonia fan Christodoulou said he wasn’t interested in taking over another Cypriot team.

“If I can’t have the team of my heart, I am not interested.”

Christodoulou, 56, made his estimated €2.4 bln fortune in London real estate.

Papastavrou has introduced a more business-oriented model to Omonia once drowning in debt.

Omonia’s flagging fortunes were revived after being taken over by Papastavrou in 2018. He pledged to invest more than €30 mln.

Last year, Nicosia’s Greens completed their most successful season after winning the league and participating in a European tournament group stage for the first time in its 73-year history.

Papastavrou made good on his word from day one, saving Omonia by directly injecting €1.5 mln, crucial to pass UEFA’s financial criteria, which the club could not have met otherwise.

Omonia’s Europa group stage qualification had brought in another €8 mln, of which €5 mln is a bonus for participating in the Champions League playoffs after being knocked out by Greek opponents Olympiacos Piraeus.

This season, Omonia are in the newly founded Europa Conference League, where it has generated €4 mln.