Up to 100 European Football Clubs Eye UEFA Recovery Funds
(Bloomberg) -- As many as 100 of Europe’s pandemic-hit soccer clubs are seeking to access a new multibillion-euro loan fund being set up by UEFA, according to people familiar with the matter.
The teams have indicated an initial demand for borrowing a combined 2 billion euros ($2.3 billion) from the fund being readied by the sport’s European governing body, as they seek to repair financial damage wrought by the Covid-19 crisis, the people said.
The money will initially be used to settle unpaid transfer deals, helping smaller clubs in Europe that are more reliant on player sales for their income, according to the people, who asked not to be identified discussing confidential information.
UEFA and the European Club Association, which represents teams in the region, are putting the final touches to the project. It comes in response to European clubs having lost an estimated 9 billion euros in revenue as a consequence of stadium shutdowns and shortened seasons during the pandemic.
The lending facility is part of a proposed three-pronged recovery strategy from UEFA, Bloomberg News reported in August. The sporting body also wants to create an emergency pot of money to guard against future crises and set new rules on financial fair play.
It’s in the process of deciding on the one or more banks that will help finance the project, under which loans will be secured against broadcast income for European competitions. Teams accessing it are expected to be offered a lower rate of interest than what’s available in the commercial loan market. Those applying will be assessed on financial and sporting metrics.
A representative for the ECA declined to comment, while a spokesperson for UEFA couldn’t immediately be reached for comment.
Tensions have been running high across European soccer after a failed attempt earlier this year by a group of the region’s biggest clubs to form a breakaway Super League. While that plan was quickly scrapped in the face of fierce fan and political opposition, many top teams remain in desperate need of a financial boost.
“Everybody’s trying to find a different way of raising funds,” said Adam Sommerfeld, managing partner at sports advisory firm Certus Capital Partners.
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