Kieran Maguire: West Brom in line for £8m 'boutique' windfall as talks begin
West Brom could borrow as much as £8million from MSD Holdings at an interest rate of around nine per cent.
That is the view of finance guru Kieran Maguire, speaking exclusively to Football Insider about the Baggies' hunt for external funding.
The Express and Star reported on Thursday (22 December) that they are looking to borrow from the private equity firm.
Minority stakeholders, who account for 12 per cent of the club's shares, have been informed of the club's decision.
The exact purpose of the loan has not been defined, but analysts suggest that at least some of it could be used to fund activity in the January transfer window.
Maguire assessed the pros and cons of a potential deal with a company like MSD Holdings.
"MSD Holdings are a niche boutique lender," he told Football Insider's Adam Williams.
"They concentrate on the sports and entertainment space.
"In terms of the amount they are likely to borrow, I expect it will be in the single millions given there is limited scope in terms of parachute payments available to West Brom.
"The upside is that it assists with cash flow. It could be beneficial in terms of the January transfer market.
"The downside is that MSD usually charge in the region of 8.5 to 9.5 in interest. Therefore, if they borrow £7m or £8m, it is another £500,000 haemorrhaging out of the club at a time when every penny counts."