Kukla's Korner Hockey
by Paul on 07/18/13 at 05:13 PM ET
via Mike Ozanian of Forbes,
After winning the Southeast Division in the Eastern Conference, the Washington Capitals were upset in the first round of the NHL playoffs this past season by the New York Rangers in seven games. But the Capitals have scored big on Wall Street.
Sources have told me that Ted Leonsis refinanced the debt on his hockey team last month with a $100 million package led by Citigroup. The loan was oversubscribed, meaning more people wanted to buy the debt than was available. And the refinancing was bigger than the previous loan, thereby increasing the amount of debt on the hockey team.
Leonsis owns the Capitals, Washington Wizards of the NBA, and the arena the two teams call home, the Verizon Center, through his holding company,Monumental Sports and Entertainment. Leonsis bought the Capitals for $85 million in 1999 and we valued the team at $250 million last November.
The NHL in general seems to be taking on more debt. The league increased its credit facility to $600 million from $400 million last month, also through Citigroup. The new deal is priced at the London interbank offered rate, or Libor, plus 250 basis points. The previous facility was $400 million, at Libor plus 300 basis points.
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