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Dallas Cowboys

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Submitted By Georgy1987
Words 325
Pages 2
Final Case Study
Financial Management
Done by Georgy Volkov
Topic:
Dallas Cowboys Stadium

In order to complete the task, I first write out the financial information:

The team value - 851 000 000 $
Total Revenues in year 2002 – 198 000 000 $
The cost of construction of the new stadium - 650 000 000 $
Time to build the stadium - 2 years (2003 and 2005).
Costs will be paid in two parts of 325 000 000 $ in year 2004 and year 2005
Rights of the name - 18 000 000 $ per year until year 2035.
Stadium rent - 8% of the stadium revenue
Private funds - 500 000 000 $, amortization is 15 years, interest rate is 10%
They also took a loan from G-3 - 150 000 000 $, amortization is 15 years, interest rate is 7%.
Inflation rate is 2,5 %
The tax rate is 20 % (I took it so, because there was no information about the tax rate in the case and at that time NFL was tax-exempt. However, this exempt will end in 2015, according to WSJ - http://www.wsj.com/articles/nfl-to-end-tax-exempt-status-1430241845 )
Depreciation is 15 years at 43.33 000 000 $ per year
The maintenance costs will be 7 000 000 $ per year

In the conclusion I would like to say, that without the help of City of Arlington, the loan form G-3, it would practically impossible for Dallas Cowboys and its owner Jerri Jones to build the stadium. Even the Texas governor passed the bill for people to vote in order to decide, whether to raise the taxes or not to pay for a stadium complex for Dallas Cowboys.
Also, I would like to add, that if the city would not help the team, the was a possibility to move to another town. And that would be a great loss for Dallas, because Cowboys now rank as the 3 most valuable Sport Team in the world according to Forbes.

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