Société Générale has filled the bank deal for the Pittsburgh Penguins of the National Hockey League and launched the National Basketball Association's Charlotte Hornets credit last Wednesday in New Orleans. The Hornets transaction is a $75 million refinancing that has been funded but not yet syndicated. The deal partially backs the proposed move to New Orleans, following a request to the NBA to relocate the franchise. A response is expected from the league in early April.
Split between a $35 million revolver and $40 million term loan, 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 and sports investors have been approached, said a banker, who noted the bank meeting was in the new state-of-the-art arena in New Orleans. The New Orleans council built a stadium two years ago without having an anchor tenant, so if the Hornets are successful with the move, play will begin next season, the banker said. The principal collateral on the deal is the franchise and with the already constructed stadium, prospects are good, he added. Meanwhile, the Charlotte city council has also obtained financing from Bank of America, Wachovia Bank and Duke Energy for $100 million, in order to keep the team in Charlotte by building a more state-of-the-art arena. However, one banker said, "The council cannot really dictate to the owners of the team where they play, and so this scenario is unlikely." The Penguins deal is $35 million.