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Football finance expert Stefan Borsen has explained the details of the deal Tottenham Hotspur have struck with Macquarie Group Ltd to raise £90m.
Since Daniel Levy’s exit, we have seen reports that the Lewis family are ready to inject over £100m into Tottenham so that the Lilywhites can go toe-to-toe with the biggest clubs in Europe.
Last week, it emerged that Tottenham have raised £90m through a receivables financing deal with Macquarie Group Ltd.
It was explained that Spurs had agreed to give Macquarie Group income from their future broadcasting rights in exchange for a lump sum of cash upfront.
Stefan Borsen explains the £90m deal Tottenham have struck
Borsen points out that by borrowing the £90m figure, Tottenham Hotspur have contractually agreed that Macquarie would be owed around £100m from the club’s next broadcast revenue payment from the Premier League.
He explained that Spurs have simply borrowed against their future earnings, which are guaranteed, meaning there is very little risk for Macquarie.
When asked about Tottenham raising the £90m, Borsen told Football Insider: “Macquarie will effectively get an assignment of the revenue that’s coming from the Premier League, which is as good as guaranteed between now and next May, so they will know that money is definitely coming.
“Let’s say, for the sake of discussion, it’s the first £100m and they give Tottenham £90m now. These numbers are illustrative. It might not be £100m, it might be £95m, I don’t know what the interest rate is effectively.
Let’s say you work on £100m. So, £100m comes into Macquarie next May from the Premier League, but they’ve advanced Tottenham Hotspur £90m, so Macquarie make £10m for that lending.
“Spurs get their money today rather than in May. They can spend that money. They can do what they want with it. They’ve accelerated the payment of that money from the Premier League.
“The extent of Macquarie’s risk on that money is that the Premier League effectively can’t pay it. That’s very unlikely. There’s almost zero chance of that, and everybody’s happy. That’s how those things work. It just accelerates money that’s almost certain to come in.”
Not everyone is convinced ENIC will inject funds into Tottenham
Despite all the positive talk from the Lewis family, the reality remains that ENIC have invested only £122.1m into Tottenham since buying the club in 2001.
This latest move is not encouraging, as they have simply borrowed against the club’s future income rather than pumping equity into the club.
In fact, some financial experts see this as a sign that the Lewis family will not be injecting their own funds into Tottenham.
- READ MORE: Lewis family devise new Tottenham plan to put sporting success ahead of debt-driven approach
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