John Textor goes to war with Lyon owners! Botafogo demand €65m from French side as new lawsuit launched after American investor moves Brazilian club's assets to Cayman Islands company

According to Globo, Botafogo’s board approved a €100 million (£87m/$115m) loan, using all club assets as collateral, to shift its financial holdings to a Cayman Islands company, but Lyon's parent company, Eagle Football Group, is attempting to block the transfer via a court in Brazil. Meanwhile, L'Equipe reports the Brazilian side are demanding they be paid a whopping €65m (£56m/$75m) by the Ligue 1 side, alleging they are owed unpaid transfer fees. Botafogo claim they agreed to sell Luiz Henrique to Zenit and Igor Jesus and Jair to Nottingham Forest in order to free up cash to support Lyon during their difficulty with the National Directorate of Management Control (DNCG).

Textor held majority ownership of Lyon and Crystal Palace through his Eagle Football Group. Despite repeated warnings about Lyon’s financial problems, the club's situation grew increasingly dire until they were provisionally relegated to Ligue 2 by the DNCG, French football's financial watchdog, though the decision was overturned on appeal. Textor sold his shares in Palace to avoid a conflict of interest with both teams competing in Europe, while he stepped down from his role at Lyon following their punishment.

Botafogo confirmed their intention to sue Lyon over unpaid dues from player transfers undervalued between the two clubs, stating: “Unfortunately, measures adopted by regulatory bodies in France have compromised the functioning of this integration, resulting in the interruption of cash pooling agreements that had been beneficial to all parties. Given this scenario, it became necessary to formalise, through legal means, that the current financial imbalance between the entities indicates the need to reimburse SAF Botafogo for amounts previously borrowed.

"Furthermore, some corporate measures were adopted, with due alignment with our shareholder partner, Botafogo de Futebol e Regatas (BFR), aiming to allow the entry of new capital contributions to the Club, in case the reimbursements from Eagle or Olympique Lyonnais (OL) are not immediately feasible. Such actions were not intended to be provocative, and SAF Botafogo fully recognises the right of its majority shareholder to have priority in any investment opportunity in the Club before considering the participation of external investors. However, we emphasise that such investments would not be necessary if OL manages to honour the due reimbursements.

"For clarification purposes, we highlight that the corporate actions taken so far consist solely of legal authorisations and that there is, at the present moment, no plan aimed at diluting the shareholding participation of our majority shareholder. In fact, such measures would be necessary to enable the majority shareholder itself to make new investments."

A messy affair, Lyon fans will hope that the issue with Textor will be solved amicably with the league set to commence in less than 10 days. Textor will hope that he will be able to solve his legal issues and the Brazilian court take a lenient stance in his case at Botafogo.