Zalgiris was granted a €2 million loan / News - Basketnews.com

Credit: BNS Credit BNS

The State Investment Management Agency (VIVA) that manages State Aid Fund for Business granted a €2 million loan for Zalgiris Kaunas.

Zalgiris Kaunas / Schedule

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"Due to limitations on mass events, sports and culture sectors were crippled by the pandemic," said the General Secretary of VIVA, Dainius Vilcinskas.

"Zalgiris did not receive the income they planned to from ticket sales, partnerships, and advertising. That created a need for funds within the club. VIVA's loan will help Zalgiris cover some of their expenses, ensure financial stability, competitiveness, and timely salary payments.

The State Aid Fund and Zalgiris signed on a €2 million loan at the end of September. The loan will have to be paid back within six years.

"When forming this season's budget, we evaluated the potential income from ticket sales this season very carefully," Zalgiris General Manager Paulius Motiejunas said. "Last season's example showed that the pandemic can adjust the safety requirements inside of arenas, which greatly reduces the ability to collect a part of the planned budget."

"Therefore, we have decided to take precautions and apply for a loan to have a balanced budget. If the income from tickets returns to a pre-pandemic level, we will be able to return the loan faster."

The press release also notes that significantly reducing the budget would have a long-term adverse effect on the club's work and achievements.

If the team could not remain a strong competitor in the EuroLeague, the fans' and partners' expectations would decrease, resulting in reduced income in the future.

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