NBA securing loans for 15 nba teams
The Sports Business Journal has word about the NBA's new financial move:
The NBA is set to borrow $175 million Feb. 26, marking one of the first league financings since the implosion of the credit markets last fall.
The money, which will be available to 15 teams, supplements an existing $1.7 billion leaguewide credit facility that uses the NBA's media contracts as collateral to secure loans for the clubs. The NBA surveyed its teams, and 15 responded they would like to tap into the new borrowing.
While the league said it is pleased to borrow in an extremely illiquid credit market, the deal came at a cost, with interest rates up to 8.27 percent, hammering home the notion that the era of cheap money in sports is over. The 15 teams can use the money for any purpose, but covering operating losses may be high on the list.
"In this economic environment, it's tremendous that the league can place such a facility," said Alex Martins, chief operating officer of the Orlando Magic, which plans to borrow from the new debt. "It certainly helps us bridge the time period between now and when we move into our new events center in 2010. We've been operating at a $15 [million] to $20 million [annual] loss over the past half-dozen years, so it helps us."
Each of the 15 teams can borrow a maximum of $11.66 million from the debt proceeds.
• NBA securing $175M for clubs (Sports Business Journal)
Thank God we have an owner like Paul Allen.
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21 comments
Comments
Wow.
Does anybody think the RLEC isn’t really, really, really enticing to some owners out there?
The cowards never started
The weak died along the way
Only the strong survived
They were the Trailblazers
by lukeyhere on Feb 17, 2009 9:45 AM PST reply actions 0 recs
Which 15?
When I rule the world, everyone will know how to use Excel.
by jscot on Feb 17, 2009 9:45 AM PST reply actions 0 recs
That's the big question, eh?
Here’s a couple I can guarantee: Memphis. Sacramento.
The cilantro in your tapioca pudding since 2007.™
by timbo on Feb 17, 2009 9:50 AM PST up reply actions 0 recs
Orlando is mentioned
When I rule the world, everyone will know how to use Excel.
by jscot on Feb 17, 2009 10:04 AM PST up reply actions 0 recs
Oh, and almost certainly New Orleans
Not Phoenix. Despite Sarver wanting to dump salary, he’s too cheap to pay 8%.
Toronto?
When I rule the world, everyone will know how to use Excel.
by jscot on Feb 17, 2009 10:06 AM PST up reply actions 0 recs
could/would we be one of the 15?...
I could see us applying just to add pressure to the “miles fiasco” (for or against us, I’m too stupid to figure)
The Faith don't panic, the faith freaks out burns out farms and torchs small villages in the name of The Faith.
by faith on Feb 17, 2009 12:43 PM PST up reply actions 0 recs
i can't see the franchise
paying hundreds of thousands of $ in interest (on top of lawyers’ fees) in hopes of gaining some minor advantage.
by grimc on Feb 17, 2009 2:25 PM PST up reply actions 0 recs
am following up with the team about this. hopefully should have something in the near future.
by Ben. on Feb 17, 2009 11:33 AM PST reply actions 0 recs
Don’t laugh, but the Blazers could be one of those teams. They still make operating losses.
Brandon is one of those quiet assassins. - Chris Paul
by Norsktroll on Feb 17, 2009 11:55 AM PST up reply actions 0 recs
how are they still operating at a loss
when they sell all their seats and have cheap players?
The goal is not to be better, the goal is to be the best.
by ratbastird on Feb 17, 2009 1:40 PM PST up reply actions 0 recs
darius miles and steve francis are two big reasons.
by Ben. on Feb 17, 2009 1:41 PM PST up reply actions 0 recs
They've been operating a loss for some time now
I don’t know how accurate this is, but according to Forbes the average price of a Blazers ticket is 47 dollars? I’m guessing that’s pretty below average for a potential playoff team.
http://www.forbes.com/lists/2008/32/nba08_Portland-Trail-Blazers_324837.html
Vinny Del Negro interviewed for the job today. I mean come on! Nobody else thinks this is nuts?
by Juiceboxjerry on Jun 6, 2008 4:21 PM CDT actions actions 0 recs
by Ozzie Montana on Feb 17, 2009 3:00 PM PST up reply actions 0 recs
Allen & Cuban
Those two probably got together and created the credit facility themselves, proposed it to the league and were probably making enough interest to pay off their own luxery taxes.
by PtownJake on Feb 17, 2009 12:16 PM PST reply actions 0 recs
Maybe they
can snatch the league out from under Stern. Wouldn’t that be glorious? Dallas vs. Portland every year? Kobe picking up his first 2 fouls in the second quarter. LeBron averaging 10 turnovers a game due to traveling the Knicks NEVER being good WMAHAHAHAHAHAHA!!!!! REVENGE SWEET REVENGE!!!!
MWHAHAHAHAHA!!!!!
He's Coming! Oden Slayer of Giants
by Idog1976 on Feb 17, 2009 12:37 PM PST up reply actions 0 recs
Sorry due to going mad with imagined power
I meant to say Kobe picking up 2 fouls 2 minutes into the first quarter (ala Oden).
He's Coming! Oden Slayer of Giants
by Idog1976 on Feb 17, 2009 12:38 PM PST up reply actions 0 recs
Just wanted to say thanks for passing this along
No mistakes in the tango, darling. Not like life. Simple. That's what makes the tango so great. If you make a mistake, and get all tangled up, you just tango on.....
I am the stone that builder refused..I am the visual...The inspiration..That made lady sing the blues....I'm the spark that makes your idea bright.....The same spark that lights the dark....So that you can know your left from your right...I am the ballot in your box....The bullet in your gun...The inner glow that lets you know...To call your brother son....The story that just begun...The promise of what's to come...And I'm 'a remain a soldier till the war is won....
by pookeyguru on Feb 17, 2009 2:16 PM PST reply actions 0 recs
I hate OKC!
Rec this comment for good luck.
by Dragline on Feb 17, 2009 3:41 PM PST reply actions 0 recs
Loan less than 12 mil per team?
That’s not very much money by NBA standard. Why not just trade a good player to the Blazers and have Allen mail you a check of forgiven loan instead.
by Sungari on Feb 17, 2009 4:53 PM PST reply actions 0 recs

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