Credit Crunch blitzes the NFL

[marmar]

NFL Owners Consider Cutting Debt Cap in Global Financial Crisis

By Aaron Kuriloff

Oct. 15 (Bloomberg) -- The National Football League will consider reducing the amount each team can borrow following turmoil in the global capital markets.

Commissioner Roger Goodell said the league had ``an obligation'' to examine its debt level each year and the current financial crisis only increased that obligation.

NFL owners voted in October 2007 to cut the amount each team could borrow by $30 million, to $120 million, before abandoning the move after a complaint from the players' union.

``Every other company is evaluating their debt levels and we're no different than that,'' Goodell said today at a league meeting in St. Petersburg, Florida. ``We're all concerned about debt in this kind of environment -- you can see what it can do.''

Asked if the union might again move to block a reduction in the league's debt ceiling, Goodell said ``they very well might.'' NFL Players Association spokesman Carl Francis didn't immediately return a telephone message seeking comment.

The NFL and its 32 teams have become ``very reliant'' on cheap, available credit to maintain cash flow, expand business and pay players, said Marc Ganis, president of the Chicago-based industry consulting firm Sportscorp Ltd.

Along with about $1.1 billion in unsecured debt issued to help teams build stadiums, the NFL has access to a $1.5 billion secured revolving loan facility and $1.2 billion in senior secured notes ``for general corporate purposes and to provide working capital,'' Fitch Ratings said in a June report.

Ganis said the credit crunch is a ``game-changer'' and its consequences could include spending cuts and tougher negotiations with the players' union. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601079&sid=aMnlmvWpuh1Q&refer=amsports

[greguganus]

1. I never could get into watching a bunch of millionaires run up and down a field. n/t