Inter Milan owners Suning believe that they could refinance loan from Oaktree Capital for three principal reasons.
This according to today’s print edition of Turin-based newspaper Tuttosport, via FCInterNews, who report that the Nerazzurri owners are still confident that they will be able to refinance the loan before it comes due, particularly for reasons related to the Champions League.,
The looming due date of a huge loan from US-based investment fund Oaktree Capital is at the heart of Suning’s current predicament at Inter.
The Nerazzurri owners secured the €275 million loan in the spring of 2021. This was to inject liquidity to cover operating costs into Inter, who were at the time in a state of financial peril in the aftermath of the first year of the COVID-19 pandemic.
The cash from the loan did just that. However, it has left Suning scrambling to pay back the loan, which comes due at the end of next May.
With interest, Suning will owe Oaktree €350 million. They are still far away from being able to pay this back.
Since Suning put Inter up as collateral on the loan, a failure to pay it back would entail control of the club passing into the hands of Oaktree.
Therefore, Suning’s options if they don’t want to lose Inter for nothing are to either sell the club, or to try and refinance the loan.
Why Inter Owners Suning Believe They Can Refinance Oaktree Capital Loan
Suning, for their part, have every intention of refinancing the loan.
Doing so will be no small matter, financially speaking.
Particularly given the current climate of very high interest rates.
However, Tuttosport report, the Nerazzurri owners believe that they have every opportunity to do so. This is for three reasons.
The first is that, to date, Suning have not used that big a chunk of the loan. They have injected what they’ve had to into Inter, but still have a significant amount of it on hand.
This will make it less onerous to refinance on new terms.
Then, there is the fact that Inter received a significant unexpected financial windfall from reaching the Champions League final last season.
Given that the Nerazzurri had not even taken the knockout rounds for granted in their budget, that is no small matter.
Finally, Tuttosport note, the upcoming changes in format for the Champions League will be a boost for Suning.
The increased revenues from participating in UEFA’s biggest competition would certainly allow for Suning to have more cash on hand in the future. As such, they could well negotiate new terms for the loan.
In any event, however, Tuttosport reports that a refinancing of the loan won’t mean any sort of change in financial strategy for Inter in the immediate future.
The club will still look to pursue a path of self-financing in the transfer market in the short term.
