Wembley bucks credit crunch with refinancing deal

Wembley bucks credit crunch with refinancing deal thumbnail

Wembley National Stadium Ltd are close to securing a refinancing deal that will save as much as £3.5 million a year in interest payments and significantly ease the financial burden on the organisation.

By Paul Kelso
The Telegraph, 9:59PM BST 24 Sep 2008

In an agreement that bucks the recent tightening of credit markets, executives at WNSL and the Football Association have negotiated a deal that will see the term of the outstanding £346 million debt extended from seven years to 15 at a reduced interest rate, thought to be below seven per cent.

The Daily Telegraph understands that the deal, negotiated with a consortium of banks led by WestLB and Barclays, two of the original backers of the stadium project, could be completed on Friday, ensuring that WNSL are spared repaying a significant lump sum that, under the terms of their previous agreement, is due on Sept 30.

The new deal, which has taken more than six months to put together, greatly simplifies Wembley’s position, with a smaller group of banks taking the place of the 13 institutions originally involved in financing the project.

The deal is a significant achievement for Alex Horne, the chief operating officer of the Football Association, who was finance director of Wembley until August, and his successor Roger Maslin.

In a further development, Maslin is to serve as acting managing director until at least September 2009 after the board abandoned their search for a chief executive.
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Accounts for the first full year of operations at Wembley, which has been open for 18 months, showed a loss of £20 million, but these have been put down to start-up costs and the deadline pressure of being ready for the 2007 FA Cup final.

Certainly the banks appear satisfied that the stadium will generate significant revenue from future sports and entertainment events. Around 95 per cent of the stadium’s debenture seats and more than 90 per cent of the Club Wembley corporate seats have been sold, and WNSL has a full sponsorship programme in place with Microsoft, Umbro and Carling, all tied to medium-term contracts.

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