- FTX owes $16.5 million after its FTX Arena deal was scrapped
- The logo has already been removed from the roof of the building, which FTX also had to pay for
- The exchange has other naming rights deals which it will likely have to pay out on
Among the myriad of issues connected with the collapse of FTX is one that, for obvious reasons, wasn’t considered at the time but which has now come into the spotlight – the FTX Arena. The naming rights to the stadium, which for 22 years had been owned by American Airlines, were bought by FTX for $135 million in March 2021, but the bankruptcy of the company has left builders prising the logo of the roof and left FTX with a $16.5 million bill and a very physical reminder of its gross mismanagement.
All Affiliations With FTX Terminated
When FTX bought the naming rights to the American Airlines Arena in March last year it made headline news, firmly planting FTX’s name on the map. However, its implosion last week meant that it was no longer in a position to keep up the payments it was contracted to, leading to the Miami Heat and Miami-Dade County announcing that they were terminating all affiliations with FTX.
This termination led to the ignominy of builders immediately ripping the FTX branding off the roof, having been there for around 18 months, with FTX footing the bill for the removal plus a $16.5 million fine for breach of contract. Whether this money will ever be forthcoming to the creditors is unclear. FTX was just one year into a 19-year long deal, further illustrating the gravity of the collapse.
FTX Has Other Naming Contracts to Pay Out For
It shouldn’t be forgotten that the FTX Arena wasn’t the company’s only foray into naming rights acquisitions. A few weeks after the FTX Arena deal it bought the naming rights to Esports organization TSM for $210 million, and a few weeks after that it splashed out another $17.5 million on the naming rights for the Cal Memorial Stadium for 10 years.
TSM said over the weekend that it was “currently consulting legal counsel to determine the best next steps to protect our team, staff, fans and players”, while adding it was still on a solid financial footing, but there has been no word yet on how the forfeiture of the Cal Memorial Stadium deal will be handled.