Club Announcement - New Stadium Scheme Financing
31 May 2017|Tottenham Hotspur
Tottenham Hotspur Limited (the "Club") is pleased to announce the signing of a five-year bank financing arrangement which includes a £400m bank facility (the "Facility") to support the financing of the 61,500 seater multi-purpose new stadium, the Tottenham Experience and the largest retail store of any football club in Europe.
The Facility will replace a £200m interim financing (the "Interim Financing") that was put in place in December 2015, of which £100m has been drawn to date. The Interim Financing provided funding for the Club whilst relocation, planning and development conditions were completed, to ensure the project remained on schedule.
Bank of America Merrill Lynch International Limited, Goldman Sachs Bank USA and HSBC Bank plc are the lenders under the Facility, and were also the lenders under the Interim Financing. In addition, HSBC are providing a £25m working capital facility to the Club as part of the new financing arrangement.
The Club has expended over £340m on the acquisition of land, the planning process (including a compulsory purchase order and legal challenges) and build costs to date, which now sees the upper tiers of the North stand being fitted with terracing. This was financed with resources of the Club plus the £100m drawn under the Interim Financing.
The remaining costs of the project will be funded from the Facility and the Club. In addition, the ENIC Group will also commit to a £50m letter of credit facility to support the stadium financing and ensure the project is fully funded through the course of its build.
The Facility has a term of five years, with no early repayment penalties or amortisation requirements and no material financial covenants until the stadium opens. The loan is secured against the new stadium and related commercial and match day revenues. There is no obligation to hedge under the Facility and the margin cost payable on the Facility ranges from Libor plus 3% -2.25% over the term.
Rothschild & Co are the Club’s financial advisor on both the Interim Financing and the Facility, with Slaughter and May acting as legal advisor on the financing and construction aspects and DLA Piper acting for the lenders.
Commenting on the new stadium financing, Matthew Collecott, Director of Finance and Operations said: “We are delighted to have three of the most prestigious and globally recognised banks supporting us. We look forward to continuing our relationship with them and our main contractor Mace as we move into the final stages of our journey to deliver the catalyst to one of London’s largest regeneration projects."
Antonio Simoes, CEO of HSBC Bank plc, said: “The new Tottenham Hotspur stadium is a very important milestone for both the Club and the community. It will help the Club to build on its success with increased attendance and new revenue streams and, crucially, be at the heart of an important regeneration and job creation for the surrounding area. We are delighted to support this momentous project.”
Elliott McCabe, Managing Director, Bank of America Merrill Lynch’s Sports Finance & Advisory Group, said: “After years of careful planning and extensive research of other new stadiums around the world, Tottenham Hotspur are developing a truly state-of-the art venue that will further elevate the Club and the overall experience for their supporters and players for years to come. Bank of America Merrill Lynch is very pleased and proud to be part of the team that Spurs have assembled to deliver what is expected to be among the most technologically advanced, iconic stadiums in all of sports.”
Greg Carey who runs the global sports finance business at Goldman Sachs, said: "This will be truly transformational for the Club. We are pleased to be working with the management team on such an iconic project that will create an inspiring destination for both sport and London. We are delighted to apply our extensive stadium expertise and capital to what we believe will be a highly successful project."