Despite the multi-million dollar machine that is the NBA, its franchises were not without its drawbacks and difficulties in this year of a pandemic. For this reason, the league came to the rescue of the teams with a “subsidy” of nothing more and nothing less than 900 million dollars.
The 30 franchises of the best basketball competition in the world will each receive 30 million from the National Basketball Association, to shore up their finances and face any liquidity problems, as reported Sports Business Daily.
The money had arisen from the placement of two halves of 450 million dollars each by the NBA in the private market, usually an investment space for large insurance companies, among others.
The money, according to the publication, will be received by the teams during this month (the season will begin on December 22) and they will be able to spend it on any need that may have arisen during this time. For these 900 million, the league, of course, will have to pay interest, but its value has not been disclosed.
The 2019-20 NBA season should have been completed in Orlando, without an audience. Photo EFE
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Regardless of the amount that each franchise will receive and what they can do with that money, for the NBA it is a victory after a season that had to be shortened, that ended up playing without an audience in Orlando and that will now have a reduced schedule but, more still important, largely without an audience.
There are many franchises that will begin to play without people in the stands or with a very small number, which will add to a year that hit hard economically.
The pandemic took 10% of the league’s revenues last season, with a fall of 1.5 billion dollars, mainly motivated by the inability to sell tickets. The public, not only for the ticket but for what they consume inside the stadiums, is responsible for about 40% of the franchise income.
In this framework, the NBA had already determined to increase its credit line from 650 million to 1,200, although Sports Business Daily confirmed that these 900 to be distributed among the franchises are not related to that money. “This is to help the teams with their boxes and with their liquidity, especially if they have to play without an audience.”
The cuts due to the whole situation derived from the Covid-19 outbreak included discounts in player salaries, a drop in the salary cap for this season (with the consequent impossibility of earning more money for players) and even a decrease in hours for employees of the franchises who in some cases were helped by donations from the basketball players themselves.
