English Premier League club Manchester United announced yesterday that it had refinanced more than £192 million of its high-interest debt to reduce interest costs by about £10 million per year.
United, which won the Premier League title earlier this month, has secured a new loan from Bank of America with lower interest rates than its previous arrangement. The Associated Press reported that United had refinanced £177.78 million of outstanding 8.75% interest sterling bonds and US$22.09 million (£14.6 million) of 8.375% dollar bonds.
The new loan, which will start on June 24, will have an estimated starting interest rate of about 2.78%. The club, which has a total debt of £370 million, will see its interest payments reduce by about £10 million to £21 million per year.
United, which is owned by the Glazer family and listed on the New York Stock Exchange, has halved its total debt over the past three years. Majid Ishaq, managing director of financial advisory group Rothschild, told the AP: “They are in a position today where they have gone back to the market to refinance that particular part of the financing on very attractive terms because they have really delivered, and grown the underlying revenue and profitability.”