Premiership rugby side Harlequins is seeking to raise as much as £15M ($21M) "by issuing a mini-bond, joining other sports teams that are finding alternative ways to bolster their finances by tapping fans for investment," according to Murad Ahmed of the FINANCIAL TIMES.
The club, "which celebrates its 150th anniversary this year," said that it was aiming to raise £7.5M ($10.7M) but "could look to raise double that amount if there were additional demand." Sports groups "have increasingly sought new routes to raise capital in recent years."
Mini-bonds -- retail bonds that cannot be resold and are offered in small amounts direct to consumers -- "have become one of the more popular ways to raise money through harnessing the fervour of supporters."
Last year, Wasps, a rival premiership rugby club, raised £35M "from issuing a bond on the London Stock Exchange."
Harlequins CEO David Ellis said, “We have a motto -- Nunquam Dormio -- which means 'Never sleep.' It means guarding against complacency, keep going harder and keep innovating. From the way we are playing on the field, to the way we are off the field, we feel this is a great time to kick on.” Harlequins said that its bond would offer a 5.5% return payable every six months, "over a five-year fixed term."
Applicants "must invest a minimum" of £2,000 ($2,850). Club members and season ticket holders "are among those enjoying a priority period of roughly two weeks from Monday to apply, before the bond is opened to the general public and other investors" (FT, 4/18).
UPGRADES: In London, Chris Jones wrote some of the money "will be used to strengthen the squad as the Premiership salary cap next season" will increase by £1M ($1.4M) to £6.5M ($9.2M). Harlequins "will also use the proceeds to promote the club" in the U.S., where it is going on tour this summer, and to improve the dressing rooms at The Stoop (EVENING STANDARD, 4/18).
