Barcelona issue bonds to refinance €424m of debt until 2050 –

Barcelona have announced that they have refinanced around 40% of their debt incurred from the Espai Barca project. The Blaugrana will now be due to pay back the full amount of that percentage by 2050.

A common theme of President Joan Laporta’s second tenure in charge has been refinancing debt and pushing costs down the line, since Barcelona’s financial crisis, severely aggravated by the pandemic. The Blaugrana have somewhere between €1b and €1.5b in debt, which has mostly been converted into long-term debt, but on top of that, the costs of renovating Camp Nou and Espai Barca take that figure closer to €3b. The total Espai Barca project, including Camp Nou renovations, is €1.45b.

Barcelona issue €424m in bonds

On Friday afternoon, just three days before the end of their fiscal year, Barcelona have announced that they have issue bonds to the tune of €424m with the agreement of Goldman Sachs, corresponding to around 40% of the debt incurred from the Espai Barca project, which is the construction of the area around Camp Nou.

The deal means that Barcelona will begin paying back the bonds in 2033, and complete their payment schedule in 2050. They put the average cost of the refinancing at 5.19%. Applied across the amount, this corresponds to around €22m. Bonds are in essence a legal contract guaranteeing payment over a time period.

Barcelona buy time

The debt was originally due to be repaid by 2028, and this while this will incur costs in terms of interest, it does by the current board time to make the repayments. With Camp Nou set to be at least 10 months behind schedule, and unlikely to be completed until 2027 at the earliest, it gives Barcelona time to get one of their biggest earners back up and running. That said, opposition groups to Laporta have expressed concerns over the club’s burgeoning debt, and suggested that the club remains in a financially unstable situation.