Inter Milan owners Suning have postponed the refinancing of their massive loan from US-based fund Oaktree Capital.
This according to today’s print edition of Italian business newspaper Il Sole 24 Ore, via FCInter1908, who report that the Nerazzurri owners are holding out to see if the conditions on the market change among high interest rates.
The looming due date of a massive loan from US-based fund Oaktree Capital is at the heart of uncertainty surrounding Suning’s future at Inter.
The loan, taken on in 2021, was for €275 million. That money was necessary for Suning to cover operating costs at the Nerazzuri amid pandemic-related financial difficulties.
Whilst that money was vital in order to inject liquidity into Inter, it came with major ramifications.
Suning put Inter up as collateral for the loan. Therefore, if the Nerazzurri owners are to default on the loan, they will lose control of the club.
Paying the loan back, moreover, has become even more difficult. With interest rates rising to 12%, Suning’s debt exposure on the loan will wise to €329.6 million at the end of 2022.
Inter Milan Owners Suning Postpone Refinancing Oaktree Loan
Another possibility before the Inter owners would be to refinance the massive loan from Oaktree.
This would mean that the due date to pay back the full amount plus interest would not loom quite so closely in the distance as it does now.
However, a key issue that could make this course of action problematic is the rising interest rates on the market.
At 12% current interest rates, it would hardly be the most favourable time to refinance the loan.
Therefore, Il Sole 24 Ore report, Suning’s financial advisors have directed them to postpone refinancing.
However, the risk here would be that the interest rates could rise higher in the near future, to as high as 16%.
Meanwhile, Il Sole 24 Ore reports, there have also been contacts with other funds for a possible payment-in-kind loan.
