NBA teams will get $30 million each to help with finances and protect against any liquidity issues due to the pandemic, according to a report in the Sports Business Journal.
The money comes from $900 million the league raised from notes issued by the NBA in the private placement market, SBJ reported. The publication said that market generally includes insurance companies and institutional investors.
The notes are for three or four years, and will be paid back with interest from "general collective league sources," SBJ reported, citing multiple sources in its report. The publication noted that the NBA's financial strength allowed it to secure the financing, and that the league was being proactive.
SBJ said this is the first time the NBA has turned to the private placement market to fund league initiatives. One source told the publication that the $30 million per team will help with cash flow and liquidity issues caused by playing with few or no fans to start the year.
The NBA gets about 40% of its revenues from game-day revenues, including ticket sales, concessions and other in-arena income.