Daniel Levy has insisted he will continue to run Tottenham on the balanced and relatively frugal business plan that has characterised his 18-year chairmanship after he announced a refinancing of the club's stadium loans.
Spurs borrowed £637 million (€720 million) from Goldman Sachs, Bank of America Merrill Lynch and HSBC for the £1 billion (€1.1 billion) project and the money was due to be repaid by April 2022. But through US investors Levy has converted roughly £525 million (€594 million) of the debt into a bond scheme, with staggered maturities of between 15 and 30 years.
Bank of America Merrill Lynch, which acted as lead placement agent and sole bookrunner on the bond issue, has provided a £112 million (€126 million) term loan and HSBC has granted a revolving credit facility. The idea is to limit Spurs’ debt-servicing costs and the average annual interest rate on the new arrangement is 2.66 per cent.
Levy was asked by the Financial Times whether the refinancing would release more money for Mauricio Pochettino, the manager, to spend on transfers or new contracts for existing players. Three key squad members – Jan Vertonghen, Toby Alderweireld and Christian Eriksen – have entered the final year on their deals.
No quick fix
“It will have no bearing on how we run the club . . . and no bearing on those types of short-term movements [like transfers],” Levy replied. “I understand as I am a fan, clearly you want to win on the pitch. But we have been trying to look at this slightly differently, in that we want to make sure we ensure an infrastructure here to stand the test of time.
“We could have easily spent more money on players. Who knows if that would have bought us more success or not. The right approach is to build from the bottom up. There is no quick fix to becoming a much more significant global club.”
Spurs posted record revenues of £380.7 million (€430.7 million) over the 2017-18 season and a pre-tax profit of £138.9 million (€157.1 million) – the largest annual profit recorded by a football club. They say they spent about £120 million (€135 million) in net terms on transfers last summer, which includes a commitment to turn Giovani Lo Celso’s loan from Real Betis into a permanent deal at the end of the season for about £60 million (€67 million).
Elliott McCabe, managing director in Bank of America Merrill Lynch's sports finance and advisory group, said: "The management team of THFC continue to position the club for long-term success by growing the brand through ongoing investment, particularly in relation to the iconic new stadium. This is reflected in the strong market reception met by Tottenham Hotspur as a first-time issuer in the private placement market."