Hornets Fees Unveiled; Move Almost Certain
Société Générale is offering 1/4% for commitments to the National Basketball Association's Charlotte Hornets' $40 million term loan. Fees on the $35 million pro rata are 3/4% for $20 million and 1/2% for $10 million. The deal partially backs the proposed move to New Orleans, following a request to the NBA to relocate the franchise that is almost certain to go through at this point, said bankers.
The credit is priced at LIBOR plus 31/ 4% with 1/2 % on the unused while the tenor is two years plus three months. Local lenders, sports investors and institutional investors have been approached, said a banker, who noted the bank meeting was in the new state-of-the-art arena in New Orleans. A naming-rights deal has not yet been announced, but cash flow is good and there is a positive feel to the credit, she noted. The principal collateral on the deal is the franchise and with the stadium already constructed, prospects are good, she added. A private rating will be assigned to the deal, the banker said. The credit has been funded but not yet syndicated with commitments expected by April 17. The Hornets senior v.p., of finance Wayne DeBlander, did not return calls.