According to a rating opinion released Monday evening by Fitch Ratings, the NFL has issued $1.27 billion in new 2023 term notes under the league-wide credit facility.
According to the view, the notes will be used to repay current debt, for general company purposes, and to provide working capital. Fitch rates the new debt as ‘A.’
Simultaneously, the league has increased the amount of money available via one of its revolving credit lines to $4.113 billion.
According to a November disclosure of the NFL’s debt load and financial information disclosed in the current Fitch rating, the new notes appear to increase the league’s total indebtedness by around $900 million to $10.87 billion, though public disclosure may provide an incomplete picture. A request for comment from the league was not immediately returned.
The notes are backed by the NFL’s national television broadcast income, which this year totals $318 million per club, for a total of $10.176 billion. Each NFL club is allowed to hold $600 million in debt.
Because of the “lockbox” structure of the TV earnings to support the debt without ever entering club owners’ hands, as well as the league’s general soundness, Fitch assesses the debt as A, which is securely investment grade in the firm’s opinion.
“The ratings reflect the NFL’s position as the most popular professional sports league in the United States, as well as its strong and highly regarded economic model,” the agency wrote in the note.
Debt ratings such as Fitch’s assist establish the market interest rate that debtors such as the NFL would pay, as well as guiding institutional investment managers, who often have credit quality requirements to follow in their funds.
The new notes dubbed the NFL Football Club Term Notes 2023-XV Trust, Series A-F, are expected to have a fixed interest rate and will be due between 2028 and 2043, according to Fitch.