RBS to renew loan facilities
- Thread starter Portly
- Start date
- Latest activity Latest activity:
- Status
I presume it means they agree to give them a new deal at a slightly higher interest rate for another few years. Gillett getting a bit fat lump sum shortly I presume helped swing it. If the loan is renewed, I wonder if there's any danger of them building us this new stadium? Seeing as part of the 300mill debt is actually put aside to start it.
It doesn't mean more debt. When the£350 million RBS loan was originally agreed with Hicks and Gillett, it had a termination date of 24th July 2009. This is the date the money has to be repaid to the bank. It is unlikely that the Americans could have found bank finance anywhere else in current economic conditions.
Normally such corporate loans are tied to a market interest rate such as LIBOR so I shouldn't think that renewal will involve higher interest.
If the bank had demanded repayment and the Americans did not have another loan to repay it with, the bank would then have made the club insolvent and the assets would have been sold off.
There were more details on the 10.00 BBC Radio 4 bulletin. According to the BBC, the new loan agreement will include compulsory repayments by installments and the club will have to "tighten its belt." That doesn't sound good for Rafa's transfer budget.
Normally such corporate loans are tied to a market interest rate such as LIBOR so I shouldn't think that renewal will involve higher interest.
If the bank had demanded repayment and the Americans did not have another loan to repay it with, the bank would then have made the club insolvent and the assets would have been sold off.
There were more details on the 10.00 BBC Radio 4 bulletin. According to the BBC, the new loan agreement will include compulsory repayments by installments and the club will have to "tighten its belt." That doesn't sound good for Rafa's transfer budget.
- Status