Debt-ridden Turkish soccer clubs including Fenerbahce and Galatasaray are seeking to renegotiate terms on their loans to unlock transfer limits hindering them from buying players.
The teams are in talks with banks on extending the maturity of some borrowings to as many as 12 years from five years, according to people familiar with the negotiations. Clubs are also pushing for a grace period in which they don’t to need to make repayments for two to three years from the signing of a new agreement, the people said, asking not to be identified because deliberations are confidential.
A deal would allow clubs to make transfers for the 2020-21 season with less scrutiny from the Turkish Football Federation. Authorities last month capped how much teams can spend on players after lavish outlays in the past on stars like Didier Drogba, Roberto Carlos and Robin van Persie contributed to financial difficulties at clubs while failing to guarantee their regular progress to Europe’s top soccer championship.
The limits, which were also thrust on Besiktas and Trabzonspor, are intended to bring local teams into line with so-called Financial-Fair Play rules put in place by the Union of European Football Association to prevent clubs from spending more than earn.
Fenerbahce’s shares rose as much as 10% on Monday to the highest level since May 2011. Galatasaray extended gains to climb as much as 8.9% to a three-month high. Besiktas jumped 8.1% and Trabzonspor 8%.
The clubs are in negotiations with state lenders including TC Ziraat Bankasi AS and Turkiye Halk Bankasi AS as well as Dubai-based Emirates NBD’s Denizbank AS among others, the people said.
The four clubs owe banks a combined 6.2 billion liras ($831 million), according to their end-May financial filings. This compares with their total annual revenue of 2.4 billion liras.
Ziraat Bankasi, Halkbank, Fenerbahce and the Turkish Football Federation declined to comment. Denizbank didn’t immediately respond to requests seeking comment. Some details on the talks were earlier reported by daily newspaper Sozcu.
The decision to institute transfer limits caused a furor among Fenerbahce fans who threatened to cancel subscriptions to broadcaster BeIN Media to force the regulator to reconsider the limits. Unlike its rivals, Fenerbahce didn’t sign the five-year restructuring deal with the banks.
The club’s chairman, Ali Koc, a major shareholder in the country’s biggest business and industrial conglomerate Koc Holding AS, said the initial pact wasn’t sustainable and that lenders could end up having to take over the soccer companies once the two-year grace period ends in 2021.
(Updates share prices in fifth paragraph.)
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