NBA Bails Out Teams With $200 Million Credit Line?
In a slumping economy, everyone is hurting, even large corporations. However, the NBA is the latest to borrow money to help their business.
According to reports from the Associated Press, the NBA (National Basketball Association) has lined up a $200 million loan to distribute among teams across the board interested in additional cash.
The league, however, considers the money as a sign it remains strong in a slumping economy.
Each team will have around $13 million to $20 million available to each of 12 teams that have expressed interest in the funds, Commissioner David Stern told the AP, which they can use for any purpose.
While the funds may look like an attempt to bailout possibly struggling teams, Stern said it should not be construed as such. "This was a show of strength in the credit worthiness of the NBA's teams," he said. "Many of them are doing well."
Reports state that the NBA has a $1.7 billion line of credit, including the $200 million in credit, which Bank of America and JPMorgan Chase have committed.
The NBA has not disclosed what teams were interested in the loans. However, the Indiana Pacers are not among them, said its co-owner Herb Simon. But the Sacramento Kings, and the Orlando Magic are said to be in line.
The Kings' vice president of business communications, Mitch Germann, confirmed that the team plans to participate.