May 28, 2015 (LPC) - English Premier League football club Manchester United has agreed a refinancing totalling around US$840m, reducing its financing costs and extending the maturity of its debt.
The refinancing sees an existing senior secured term loan with Bank of America Merrill Lynch amended to reduce the facility amount to US$225m from US$315.7m, while the maturity of the loan has been extended out to June 26, 2025.
Pricing on the amended loan, which is for wholly-owned subsidiary Red Football and MU Finance, has been reduced to 125bp–175bp over Libor, depending on leverage, from 150bp–275bp.
The amendment is expected to close on or around June 26.
MU Finance is also raising US$425m of senior secured bonds in a private placement that will be used to redeem US$269m of the company’s 8.375% senior secured bonds that were due in 2017 and reduce the outstanding debt under the term loan.
The new bonds pay 3.79% and are due in 2027.
Red Football also agreed a new £125m revolving credit facility, to replace its existing revolvers. The six-year facility, which can be increased by £25m through incremental facilities, pays 125bp–175bp over Libor/Euribor, depending on leverage.
The revolver is also expected to close in or around June 26.
Manchester United finished fourth in the Premier League in the 2014/15 season, thus qualifying for the UEFA Champions League.
