Where the League raises capital to on-lend to the different Clubs within their league.  The Lenders/Bondholders have the benefit of a first call on all the revenue the league is able to generate directly (media rights etc.) before distribution to the Clubs within their league.  In the US the Leagues are rated higher than any individual Franchise – this enables them to borrow money cheaper and on-lend to the Franchises where required. In EU, it was post COVID when leagues sought to raise debt. In 2021 I brought in Met Life to provide £117.5m for EFL to on leand to various clubs in the Championship. Payment flow came from the Premier League in forms of parachute and solidarity payments. Debt was amortisied over 3 years extendable to 6 years for clubs relegated. It was rated BBB+ and the first league rating in EU.

Where the Club borrows money which is backed by all their assets (stadium, media, commercial, merchandise etc.). Covenants will likely to be based on Net Debt/EBITDA with slight deleveraging over time.  There are a number of Clubs in EU who have a private credit rating.

SPV structures based on revenue generated by the Stadium Only (“StadCo”) without recourse to the Club. These deals are easier in leagues without relegation.  In the EU some of the top clubs can structure StadCo deals based on the free cash from the stadium not being needed to pay the players (given the size of the media revenues). Most StadCo deals are likely to be viewed by the rating agencies as being consolidated with the Club but might see a credit uplift given the structural protections for bondholders.

While mainly seen in the US, this funding is based off the revenue generated by the premium seating only. The Club has to enter into an agreement to sell these assigned seats first in this category. Again, might see a credit uplift given the protection for bondholders.

MediaCo’s can be setup to receive all the media revenues that the Club (or League) generates. While funders will have first call on these revenues the revenues are needed to pay the players – without which there would be no media revenues. It is important to understand the protection the Club provides in these structures.  Again, due to the senior rights of the bondholders there might be a credit uplift.

Such a funding is required when a Club pays for a new player over time. The Selling Club will seek funding against this payment through a bank on a receivables basis.  Such payments are caught under the “football creditors rule” where the league ensures Paying Clubs payment is a priority payment to other Clubs.   Football regulatory bodies retain the ability to impose sporting sanctions on the Paying Club which act as a significant deterrent for Paying Clubs not to default on their transfer payment obligations.  The Credit Rating will be linked to that of the rating of the Paying Club but a credit uplift may be achieved given the additional structural protection offered to bondholders. In 2021 I brought in an Institutional Investor to discount payments of a player going to a Premier League Team for an EU Team.

There are other types of similarly structured transactions such as: Stadium Sale and Leaseback, Pitch Sale and Leaseback, Training Facilities etc.  These transactions rely on the Club to make ongoing payments and thus the Credit Rating is likely to be capped by the rating of the Club.

I have extensive knowledge of a range of different airports including: single assets; a portfolio of airports, hubs; important O&D or regional airports. I have considerable experience in looking at the issues well established or rapidly growing airports (particularly in emerging markets) have to contend with. All airports are slightly different given the markets they cover and the airlines who use them. Airports can also have different approaches to their non-aeronautical revenues streams; and varied understandings how these will change over time. I have written an articles on how airports recover following global economic issues.

I have been involved with many different toll roads over the years and it is a sector where all aspects need careful scrutiny. Clearly many greenfield toll roads have had their issues, and have often needed to be restructured. Even PPP availability payments, shadow tolls or congestion payments have not always been safe investments. However, well established toll roads which offer a monopoly service can be considered akin to a utility risk and therefore very stable. Sometimes, when these are sold the new owner’s predictions on traffic growth and tariff increases can lead to a toll road being over-leveraged. I have written an articles on how toll roads may recover quickly following global economic issues.

This sector is very diverse as there are many different types of port entities:- port authorities, single asset ports, single product ports, port companies with multiple port assets, container terminals, storage terminals, RoRo facilitates and cruise terminals etc. Ports have to constantly evolve given the increasing size of vessels and type of products they are exporting/importing. In some cases they will also have to compete with similar local facilities. Ports are also reliant upon the development of their hinterland – both the transportation network (rail and roads) and local industries. Some ports can be underpinned by long term contracts with shippers who need warehouse facilitates. However, some ports can become obsolete or partially obsolete but unlike other transportation assets they can be developed:- offshore wind servicing facilities, biomass facilities, luxury housing, financial sector centre and in one case, an airport.

This sector is largely within the public sector so assets are Government-run. I have been involved in a few diverse transactions which have been have been funded by the private sector:- high speed lines; dedicated rolling stock; metros/undergrounds; tramlines and systems and railway stations. All of these can present very different risks. It is a sector which has seen significant construction delays, cost overruns and technical operational difficulties as well as longer ramp up periods than anticipated. Once operational, what is important in this sector, is the relationship with the Government and what level of protection they offer for usage and payment risk.

I have had a lot of detailed involvement with transportation transactions which are considered to be infrastructure assets being linked to primary transportation assets. Examples are: motorway service stations, car parks, rental car facilities, ferry services, dedicated vessels, airport services companies and port services companies. There is a need here to look at the users and how much they would pay for that service. However, these are secondary risk type transactions as, if the “primary transportation asset” has issues, this will directly impact these secondary assets. For example less airport passengers will impact rental car facilities, less cars on a toll road will impact motorway service companies and less vessels coming into a port will impact port service companies. In other words there is little these secondary transportation assets can independently do to attract more users.

In the late 90’s the first wind deals I saw were in Northern California, fields and fields of small wind turbines were all sadly stationary. The design had underestimated the environment they were operating within. Now turbines are larger and are proving themselves in tougher hostile operating environments. However, technical issues still remain including: failing foundations, laminated blades peeling and driveshafts snapping etc. It maybe that some windfarms will need repowering earlier than anticipated.

I have been involved in solar farms and rooftop transactions in Europe and Asia. Whilst the construction risks are reduced in this “plug and play” sector, there have been grid connection issues and inverter failures which can take time to resolve. As the sector has evolved Debt Service Cover Ratios have been lowered given that performance tends to be more stable and predictable than that of wind transactions. Larger and larger solar farms in challenging locations have been built and what has not yet been tested is the resilience of the degregration of the panels.

Each hydro transaction I have been involved with has had challenges, be that “run of river” or “large dams”. These issues can be different operationally, but all rely on predictability of rainfall or ice melt. Dams can partially protect themselves from this issue depending on the size of their storage capability. Each deal needs careful structuring to protect all investors.

While geothermal deals have similar traits to other renewable transactions, the nature of the geothermal reserves means that additional capital investment is needed in order to keep the asset performing to the nameplate capacity. The timing of the expenditure is uncertain, as it depends on how the geothermal reserves already accessed are performing. These assets can be in difficult terrain.

Or “Energy from Waste” transactions are very challenging during construction and early ramp up period. There can be a mismatch between the technology installed and the changing nature of waste from the local market. This can lead to a period of uncertainty. However, deals I have been involved with have been more stable as the assets were well established and the ongoing maintenance regime agreed. It is likely more of these assets will be needed if suitable sites can be secured.

Around the globe, I have been involved in both gas fired and coal fired thermal power stations. All have had firm long term contracts for the feedstock and the power – mainly involving state-owned entities. Whilst some have had technical issues during ramp up, once they have settled they operate (with good maintenance) to the required base load level. However, these transactions will come under pressure on two grounds:- 1) the climate change lobby and 2) renewables will be cheaper then traditional thermal power. Likely debt restructurings will be a feature of this sector.

My involvement in this diverse sector includes: borrowing base facilities as well as refineries, pipelines, LNG Vessels, gas gathering systems etc.

These transactions can be very wide ranging and diverse in terms of location, product and method of mining. Changes will be forced upon miners with some mines (coal) becoming less popular (where stranded assets will be seen) and others (minerals for battery technology) more popular. In this sector, no matter what type of transaction, very careful analysis and structuring is needed.

I have been involved in Pubco Whole Business Securitisations for over 15 years and during this time Pubco’s have had many challenging issues to address. Whilst they have had to adjust their business due to: the global financial crisis; smoking ban; minimum wages; supermarket cheap beers; increasing high street themed restaurants; new fast food delivery services; COVID and then the subsequently cost of living economic issues. While Pubcos have the experience to manage these issues and adjust their business model to survive, it is going to be a challenge on all fronts. They will need to offer a product acceptable to their customers, ensure welfare of staff, secure reliable supply chains etc. as well as adjust their capital structure.

I also have detailed experience in the following diverse sectors:- theme parks, funeral homes, holiday parks, student accommodation, telecommunications, film publishers, construction companies and nursing homes.