NBA teams to receive $30 million for dealing with COVID-19-induced losses in 2020 season

The NBA, like most other professional leagues, lost a significant chunk of their revenue due to the COVID-19 pandemic. Following a suspension on March 11, the league was continued at the NBA bubble in Orlando, Flordia. While the bubble was reported to have helped with the team's finances, it did not cover all costs. As a result, the league will be giving $30 million to each NBA team, helping them deal with COVID-19 related costs. 

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League to give all teams $30 million each for COVID-19-related finances 

As per the Sports Business Journal (SBJ), teams will be receiving $30 million from the league. This money is to help with their finances and for any liquidity issues cased due to the pandemic. The money, as per SBJ, is from the $900 million the NBA made from notes issued by them in the private placement markets ( insurance companies, investors).

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The league has been "proactive" regarding their finances, which earned them the financing. As per SBJ, the notes are meant for three or four years, and the league's financial strength helped secure the funds. The money will be paid back with interest from the league's general collective sources. 

The league, after the 2019-20 season, faced a 10% dip in their revenue. While the league lost most of their money from gate receipts (40%), their loss from the China partnership also affected the final amount. Per reports, $800 million was lost due to fans not being able to attend, while $400 million was lost as a result of sponsorships and merchandise being affected. The "net negative impact" from their China partnership was said to be $200 million. 

According to SBJ, this is the first time the league has ued the private placement market for league activities. The $30 million might not be enough but will help with revenue affected by a limited number of fan's attending games. 

Also read | NBA COVID-19 rules : Teams that break virus protocols may lose games, picks

NBA pre-season schedule

To lessen the financial blow, the league will start their season after a short 72-day offseason. The league will start on December 22, which will be preceded by their camps and preseason games. The preseason games will begin on December 11, continued till December 19. 

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(Image credits: AP)