European football clubs are "turning to the U.S. bond market for funding that could help them buy and trade more players," according to Matt Scully of BLOOMBERG. London-based XXIII Capital sold last week $73M of bonds "backed by media-rights payments and player-transfer fees" from clubs in Europe’s largest football leagues, including U.K.’s Premier League, Germany’s Bundesliga, Spain’s La Liga, France’s Ligue 1 and Italy’s Serie A, according to Kroll Bond Rating Agency. The bonds pay investors through cash streams, "mostly insured, from agreements made across the leagues." The deal "may help clubs hire more sales staff, open new offices or finance new stadiums and facilities, in addition to obtaining players," said Kroll, which rated most of the bonds A. Football clubs across Europe have been "struggling to raise funds" since the '08 banking crisis, when top-tier financial institutions "largely pulled out of providing loans to clubs." Since then, clubs have turned to "boutique investment funds that typically provide loans in return for higher premiums than banks and ask for teams’ television income, receivable transfer fees or future season-ticket income as collateral." The football bonds -- the first of their kind, according to Kroll -- are the most recent "esoteric" securities being sold in U.S. securitization markets (BLOOMBERG, 1/15).
