MLB issued around $40M in new debt in May, according to a ratings release from Fitch. The funds will support team-level borrowing through MLB Club Trust Securitization, a league-controlled credit facility. Fitch assigned an A rating and stable outlook for the new term notes.
Fitch also revealed that, in April, MLB increased its credit facility’s borrowing limit from $125M to $150M per club. The ratings agency indicated that 28 MLB teams have utilized the league’s credit facility.
As in its prior favorable credit ratings for MLB, Fitch pointed to the strength of the league’s media rights agreements with ESPN, Fox, NBC, Netflix and TBS, which are pledged to support debt service payments. Those deals are set to expire after the 2028 season, with Fitch anticipating the league’s next round of media deals will deliver “a moderate increase over the prior average annual value.”
Fitch suggested confidence in MLB’s ability to navigate a looming labor battle, though it noted that “the approaching CBA expiration introduces a degree of uncertainty that warrants monitoring,” and that the effects of a prolonged lockout could ultimately lead to a credit downgrade.
