OL Groupe, owner of the Olympique Lyonnais football club, has reached a preliminary agreement with several international financial institutions to receive €320m over a long-term basis as financing to cover the majority of the firm’s debt.
The group revealed that it will use the newly-obtained funds to repay the so-called ‘stadium’ debt, which is an accumulation of state-guaranteed grants and loans given to the company by private investors to keep its football club afloat during the COVID pandemic, when crucial income generated by ticket sales was essentially cut off but the question of player and staff salaries remained.
What’s more, the fresh capital will further benefit the group by giving it more freedom with its business decisions, as prior financing contracts in place restricted some of OL Groupe’s corporate activity unless it got an approval from creditors.
The new financing has been given 31 December as the closing deadline if the final documentation and conditions in it are agreed upon by all parties and correlate with investors’ interests.
Credit rating agencies KBRA Europe and DBRS Morningstar have given the proposed structure a financial rating of BBB+ and BBB respectively. OL Groupe is additionally being advised by Goldman Sachs in relation to the refinancing.
John Textor, Chairman and CEO of OL Groupe, commented: “We are extremely pleased with the leadership of Goldman Sachs as our advisor on this refinancing, which brings a number of leading institutions in support of the OL Groupe business plan.
“The affirmation of leading credit rating agencies, and the quality of our new investors, are a testament to the strength of the OL brand, the improving health of our business, and the strength of our go-forward business plan”.