With the appointment of administrators, Cork Gully, in London’s High Court on Friday 27th March 2026, a detailed analysis shows Ares (the lender and security agent) rights and what happens to the company which holds a majority stake in Eagle Football Group, the owner of Olympique Lyonnais (France) and majority owner of Botafogo (Brazil) and RWDM Brussels (Belgium).

Eagle Football Holdings Bidco Limited (the Pledgor or Bidco) is one of the most high-risk applications of private credit in the contemporary sports industry. At the heart of this structure lies a series of English law-governed debt instruments and a multi-jurisdictional security package granted to Ares Capital Corporation, acting in various capacities as agent, security agent, and primary lender. 

This report provides an analysis of the outstanding loan obligations, the intricate security interests spanning English, French, and Belgian law, the extensive rights afforded to the secured parties, and the mechanical pathways for enforcement during events of default or administration.

Analysis of outstanding loan obligations

The capital structure of Bidco includes a series of high-yield mezzanine notes issued under a UK Notes Purchase Agreement dated 25 October 2022. 

This agreement has been incrementally amended and restated to accommodate shifting liquidity needs and the escalating financial pressure on the group’s multi-club ownership model. The debt is structured into distinct tranches, primarily denominated in U$, with punitive interest rates and payment-in-kind (PIK) mechanisms that have led to a rapid compounding of the group’s total liabilities.

The debt exposure is divided across five primary series of notes, each corresponding to different financing phases of the group’s acquisition and operational strategy. The progression from Series A to Series D reflects a move from acquisition financing to emergency liquidity support.

The total original principal amount documented across these tranches is approximately $547.37 million. However, the true economic exposure is significantly higher due to the accrual of PIK interest. By October 2025, when the group first defaulted, the total debt owed to Ares and its syndicate was reported to have reached approximately $1.2 billion. 

This exponential growth is a direct consequence of the interest rates applied to these mezzanine-style loans. Market reports indicate that the loans were priced at tiers of 16%, 18%, and a maximum of 19.4%.

The payment-in-kind structure is a critical component of Ares’ rights and Bidco’s liabilities. Under this arrangement, rather than paying interest in cash, the interest amount is added to the principal balance of the notes. While this protected Bidco’s near-term cash flow during the acquisition phase of clubs like Olympique Lyonnais and Botafogo, it guaranteed that the debt burden would outpace the operational revenues of the clubs. By the 2024/25 fiscal year, the group’s interest coverage ratio, the measure of its ability to pay interest from earnings, was well below 1.0, signaling structural insolvency.

The legal consequence of this mechanism is that the secured obligations are not static. The charge documents define secured obligations as all present and future obligations… to pay any sums in principal, interests (including any capitalised interests), penalties, fees, commissions, expenses or indemnification.

 This all-encompassing definition ensures that every dollar of capitalised interest automatically falls under the protection of the existing share and receivables pledges.

Participating secured parties and syndicate composition

Ares Capital Corporation acts as the Security Agent under the Intercreditor Agreement, representing a broad syndicate of institutional investors. The Créanciers Nantis (Secured Creditors) identified in the Series D documentation include sixteen distinct entities :

• Ares Entities: Ares Capital Corporation, CION Ares Diversified Credit Fund, Ares Credit Strategies Insurance Dedicated Fund, Ares Sports Media and Entertainment Finance S.a r.l (Luxembourg), Ares European Credit Strategies Fund IX (C), L.P. (Cayman Islands), and several Credit Investment Partnerships.
• Monroe Capital Entities: Monroe (NP) U.S. Private Debt Fund LP, Monroe Capital Private Credit Master Fund IV, and various opportunistic credit funds.
• Other Stakeholders: CL Note Investment LLC, YMK Holdings LLC, and Iconic Sports Eagle Investment LLC.

The diversity of this syndicate across jurisdictions (USA, Luxembourg, Cayman Islands) necessitates the multi-jurisdictional approach to security documentation, ensuring that enforcement can be pursued in the local courts where the assets, primarily the football clubs, are domiciled.

Security interest architecture

The security package granted to Ares is comprehensive, designed to capture every stream of value and control within Bidco and its subsidiaries. The architecture is divided into three primary legal groups: French law pledges over equity and inter-company debt, English law debentures over the holding company’s undertaking, and Belgian law confirmations for local assets.

French law securities account pledges

The crown jewel of the collateral package is Bidco’s 87.78% stake in Eagle Football Group which manages the Olympique Lyonnais football club. These shares are pledged under a tiered ranking system to reflect the issuance of different note series.

The pledges cover 154,382,133 ordinary shares of EFG, registered in the name of Bidco. The specific legal vehicle for this security is the “Financial Securities Account” (Compte-Titres Nanti), specifically account No. 329 maintained with Credit Industriel et Commercial. In accordance with Article L.211-20 of the French Monetary and Financial Code, the pledge also extends to:

• New financial securities: Any shares resulting from capital increases, free allotments, or squeeze-out procedures.
• Cash proceeds (Compte Fruits et Produits): A specific bank account opened by the Pledgor to receive all dividends, interest, and income relating to the EFG shares.

The rankings are legally distinct but practically integrated via the Intercreditor Agreement. The First Ranking Pledge secures Series A and B Notes; the Second Ranking Pledge secures Series C Notes; and the Third Ranking Pledge secures the Series D liquidity tranches. The charge documents explicitly state that the Secured Parties will receive the proceeds of enforcement in accordance with the application of proceeds waterfall in the Intercreditor Agreement, regardless of the nominal ranking of each pledge. This prevents priority wars among the noteholders and allows Ares, as Security Agent, to act on behalf of the entire syndicate.

First ranking receivables pledge agreement

To ensure that cash moving from the operating clubs up to the holding company is captured, Bidco granted a first-ranking pledge over its inter-company receivables.

The perfection of this pledge is achieved through the service of a Pledge Notice to the debtors (the clubs). Under the terms of the agreement, until an Enforcement Event occurs, Bidco is authorised to receive payments on these receivables. However, once an Enforcement Event is notified, the Security Agent serves a Payments Notice, and the debtors are legally required to pay all sums directly to Ares. This mechanism effectively allows Ares to seize the group’s internal liquidity at the first sign of default.

English law supplemental debentures

Ares holds a qualifying floating charge over the entirety of Bidco’s undertaking through Supplemental Debentures dated 15 August 2025 and 31 October 2025. These instruments provide the legal basis for the administration and receivership actions taken this week.

The debentures create first fixed charges over several critical asset categories :

• Investments: All shares held by Bidco in any limited liability company incorporated in England and Wales, including the 13,042 ordinary shares of Bidco held by Midco.
• Accounts: All credit balances in bank accounts opened by the Chargors.
• Intellectual property: Patents, trademarks, service marks, designs, and domain names.
• Specific contracts: Absolute assignment of the Acquisition Agreement and any Hedging Agreements entered into in connection with the notes.
• Insurances: Assignment of proceeds from insurance policies, excluding third-party liability.

The floating charge covers “all its present and future assets and undertaking” not effectively captured by the fixed charges. Importantly, Paragraph 14 of Schedule B1 to the Insolvency Act 1986 applies to this charge, identifying it as a qualifying floating charge. This designation is the legal trigger that allows Ares to appoint an administrator out of court, bypassing lengthy judicial proceedings.

Belgian Law Security

To secure the group’s Belgian interests, specifically the Racing White Daring Molenbeek (RWDM) club, Ares and Bidco entered into “Security Confirmation Agreements”. These agreements confirm that the share pledge over Racing White Daring Molenbeek Future NV continues to exist as security for the amended and restated liabilities under the Series C and D notes. These agreements are governed by Belgian law and emphasise that the amendment of the notes does not constitute a novation that would extinguish the original security.

Ares’ rights and the obligations of the pledgor

The contractual relationship between Ares and Bidco is heavily weighted toward the rights of the lender, reflecting the distressed nature of the group’s refinancing rounds in 2025.

Governance and control rights (Clause 7.5)

Ares enjoys extensive governance rights that effectively allow it to step into the shoes of the owner upon default. Under Clause 7.5 of the Supplemental Debenture, following an Enforcement Event, the Security Agent may :

• Exercise voting rights: Take control of the votes attached to the group’s investments without any further consent from Bidco.
• Board appointment: Require Bidco to appoint one or more independent directors nominated or approved by Ares.
• Board dominance: Mandate that newly appointed directors constitute a majority or hold the casting vote at board meetings.
• Sidelining management: The Parent (Midco) is prohibited from taking any action that would block Ares from appointing these directors to Bidco’s board.

These rights were a major point of contention in 2025 and 2026, leading to the public displacement of John Textor from operational control and the appointment of Michele Kang as the stabilised head of the EFG operations.

Bidco is under a continuous obligation to provide the Security Agent with “any such certificates, information, reports and records” as Ares may reasonably require regarding the pledged accounts and inter-company receivables. Bidco must notify Ares of any project involving a listing or del-isting of the EFG shares as soon as practically possible. Furthermore, the Pledgor warrants that there are no agreements in the clubs’ constitutional documents that would prevent the entry into or enforcement of the security.

Protective covenants and negative pledges

The security documents contain a rigorous negative pledge, which prohibits Bidco from creating any further security interest over the charged assets without the express written consent of Ares. Bidco is also prohibited from:

• Disposing of assets, including the sale, transfer, or lease of the EFG shares or the intra-group receivables.
• Withdrawing funds from the “Compte Fruits et Produits” once an Enforcement Event has occurred.
• Changing the Securities Account Holder (CIC) without Ares’ permission.

Enforcement mechanisms and default actions

The enforcement framework is triggered by an “Enforcement Event,” defined as the occurrence of an Acceleration Event (under the Intercreditor Agreement) or an Administration Event (insolvency proceedings).

For the equity in EFG and the inter-company debt, Ares has three primary routes for realisation under French law.

Contractual foreclosure (Pacte Commissoire)

Pursuant to Article 2348 of the French Civil Code, the Security Agent may simply “foreclose title” to the financial securities and cash proceeds. This operates upon the expiry of a “Prior Notice” period of at least two business days. Once title is foreclosed, Ares becomes the legal owner of the shares or receivables.

Judicial attribution (Attribution Judiciaire)

Under Article 2347 of the French Civil Code, Ares may request a court order to have the assets attributed to it in payment of the debt. This is typically used when there is a risk of a Soulte (difference payment) dispute.

Public auction or listing attribution

If the securities are listed on Euronext Paris (as EFG is), Ares may have them sold or attributed in accordance with Article D.211-12 of the CMF. For non-listed assets, a public auction may be requested under Article L.211-20 V of the CMF.

To prevent the unjust enrichment of the lender during foreclosure, the French pledges mandate a formal valuation process. If title is foreclosed via a pacte commissoire, the enforcement value must be determined by an Expert.

• Selection hierarchy: The parties agreed that the expert must be chosen from (i) Ernst & Young, (ii) PricewaterhouseCoopers, or (iii) KPMG.
• Timing: The expert must deliver a report within 15 business days of their appointment.
• The soulte: If the Enforcement Value (fair market value) determined by the expert exceeds the outstanding Secured Obligations, Ares must pay the difference, the soulte, back to Bidco. The payment is due within five days of a subsequent sale of the assets or within 12–18 months of the foreclosure.

English law enforcement powers

The English Supplemental Debenture provides Ares with the authority to initiate formal insolvency proceedings or seize operational control.

Appointment of a receiver or administrator

Under Clause 16, Ares may appoint one or more Receivers over the Whole or any part of the Charged Assets. The Receiver acts as the agent of Bidco but carries the authority to realise assets for the lender. Furthermore, Ares has the power to appoint an Administrator, which it effectively did in March 2026.

Powers of receivers (Clause 17)

Every Receiver appointed by Ares is granted the powers of an “absolute owner.” This includes the power to bring or defend legal proceedings in the name of Bidco, sell assets for whatever consideration they think fit, and execute documents using Bidco’s Power of Attorney (Clause 20).

Ares may, at any time by notice, convert the floating charge into a fixed charge over specified assets if an Event of Default is continuing or if the assets are “in jeopardy”. This conversion prevents Bidco from using those assets in the ordinary course of business.

Contextual analysis of the 2025/2026 defaults

The legal powers described above moved from the theoretical to the actual between October 2025 and March 2026. This period saw the transition of the group from a borrower in distress to a group in formal administration.

October 2025 default and standstill

In October 2025, Bidco defaulted on approximately $450 million in loans owed to Ares. The default was driven by insufficient operating cash flow to cover the escalating PIK interest. Rather than immediate asset seizure, Ares agreed to a 12-month standstill period. This agreement was conditional on:

• Forced liquidation: The sale of Bidco’s 43% stake in Crystal Palace FC for £190 million, with the majority of the proceeds used to pay down Ares’ debt.
• Audit assurance: Ares provided a letter to the group’s auditors promising not to take enforcement action for 12 months, which allowed the auditors to issue a “going concern” opinion despite the technical defaults.

The 2026 administration (Cork Gully)

On 27 March 2026, the standstill effectively failed to resolve the group’s structural issues, leading to the appointment of Stephen Cork of Cork Gully as administrators of Eagle Football Holdings Bidco Limited.

The administration represents Ares exercising its rights under the qualifying floating charge. The administrators now hold the legal authority to solicit bids for Bidco’s 87.78% interest in EFG and its interests in Botafogo and RWDM.

Implications for stakeholders

The analysis of the charge documents and subsequent administration reveals a group architecture designed for a controlled descent of the Textor regime and the potential for a creditor-led takeover.

As the primary secured creditors, Ares and Michele Kang (who provided emergency guarantees in 2025) are in a position to credit bid their debt. This process involves the lender bidding the amount of their outstanding debt to purchase the collateral, the football clubs, effectively converting their status from lender to owner and extinguishing John Textor’s equity.

The “Letter Agreement” dated 7 July 2025 provides two critical deadlines that modulate Ares’ rights:

• 30 June 2026: Ares and Bidco agreed to undertake no sale process concerning EFG or its subsidiaries before this date.
• 30 June 2027: Ares agreed not to take action to remove Michele Kang from her position as CEO of EFG before this date.

These commitments create a protective perimeter around the French operations, ensuring that even if Bidco is in administration, the underlying club operations have a window of stability to complete their re-apitalisation.

Risk assessment of the MCO model

The Eagle Football case study demonstrates the systemic risk inherent in the MCO model when leveraged with mezzanine debt. The single-account model favored by Textor was challenged by French regulators (DNCG), who demanded club-specific financial accountability. When the holding company defaulted, it threatened the entire portfolio, leading to the administrative relegation of Olympique Lyonnais to Ligue 2, a decision only reversed after Ares and Michele Kang provided €87 million in additional financing and a €30 million bank guarantee.

Conclusions on the rights and actions of the parties

The charge documents analysed herein establish that Ares Capital Corporation holds an nearly absolute legal position over Bidco. The combination of first, second, and third-ranking pledges ensures that no other creditor can extract value from the group before the estimated $1.2 billion in mezzanine debt is addressed.

1. In default: Ares can seize inter-company cash flows via the Receivables Pledge, block the “Compte Fruits et Produits,” and appoint independent directors to take a majority vote on the Bidco board.
2. In administration: Ares utilises its qualifying floating charge to appoint administrators (Cork Gully), who then exercise the powers of absolute owner to restructure the group or sell the clubs.
3. In valuation: French law provides a mechanism (the Expert valuation) to ensure that any foreclosure is done at fair market value, but the punitive interest rates make it likely that the Enforcement Value will be lower than the Secured Obligations, leaving Bidco’s shareholders with zero residual value.

The 12-month standstill and the July 2025 Letter Agreement suggest a managed transition. 

While John Textor remains the majority owner of the parent company (Midco), his operational influence over Bidco and EFG has been effectively neutralised by the security architecture. 

The future of the clubs, Olympique Lyonnais, Botafogo, and RWDM, now depends on whether the administrators can identify a buyer to retire the Ares debt or if Ares and Kang will execute a wholesale debt-for-equity swap in late 2026.

The structural reliance on 16–19.4% interest debt proved to be a ticking time bomb that has now detonated, resulting in the lender-led administration that characterises the current operational state of the group.