US investment fund RedBird to buy Serie A champions AC Milan

AC Milan said Wednesday that its current owners, investment fund Elliott Management, have agreed to sell the newly-crowned Italian champions to rival US fund RedBird for 1.2 billion euros ($1.3 billion).

“The transition to new ownership will take place over the summer, with an expected closing no later than September 2022,” the club said in a statement, adding that, under the terms of the deal, Elliott will “retain a minority financial interest in the club and seats on the board of directors.”

“RedBird’s priority is to work with the club’s title-winning sporting and club management team to continue Milan’s journey back to the summit of world football,” added the statement.

Milan last month won their first Serie A title since 2011, the 19th in their history, as they pipped city rivals, and last year’s champions, Inter by two points.

RedBird’s move comes after they bought a minority stake last year in Fenway Sports Group, the owners of Liverpool and of Major League Baseball’s Boston Red Sox.

Their acquisition of Milan follows their purchase of a majority stake in French club Toulouse in 2020.

Toulouse this year won promotion back to France’s Ligue 1.

“We are honoured to be a part of AC Milan’s illustrious history and are excited to play a role in the club’s next chapter as it returns to its rightful place at the very top of Italian, European and world football,” said Gerry Cardinale, RedBird’s founder and managing partner.

Elliott Management acquired the Italian club in 2018 when Chinese businessman Li Yonghong was unable to repay a loan he had taken out when he bought the club from Silvio Berlusconi’s Fininvest in 2017.

The club was bought by Berlusconi in 1986 and spent three decades in the hands of Italy’s former prime minister, firmly establishing themselves as one of the most glamorous names in world football.

They were European champions five times between 1989 and 2007.

Huge losses
In April, Italian media reported interest from Bahrain-based investment fund Investcorp, but the talks ended without a deal at the end of May.

Italian media reported that the deal between Elliott and Investcorp collapsed as seven-time European champions Milan’s owners pushed for a higher purchase price off the back of winning the Scudetto.

The Gazzetta Dello Sport said Investcorp would not budge from a price of around one billion euros they thought had been agreed and already saw as an overvaluation.

And RedBird not only offered a higher fee, they also allowed Elliott to remain minority shareholders and keep both sporting directors Paolo Maldini and Frederic Massara in place.

Milan announced losses for last season of 96 million euros, down from a deficit of 195 million euros in 2020.

Elliott have invested 740 million euros in the club since 2018, according to Italian media.

“When Elliott acquired AC Milan in 2018, we inherited a club with a tremendous history, but with serious financial problems and a mediocre sporting performance,” Elliott’s managing partner, Gordon Singer, said in a statement on the club’s website.

“Our plan was simple: to create financial stability, and to return AC Milan to where it belongs in European football. Today, I believe we have accomplished both.”

New stadium plans
RedBird’s takeover comes amid plans for the two Milan clubs to build a new stadium on the site of their iconic San Siro home.

The current ground is supposed to stay in place until at least 2026, as it will host the opening ceremony of that year’s Winter Olympics.

Milan are one of a string of Italian clubs under North American ownership, with Roma, Bologna, Fiorentina, Venezia, Spezia and Genoa all in the hands of investors from the United States or Canada.

Atalanta are also partly American-owned.

The Rossoneri, who won the last of their seven European Cups in 2007 with Carlo Ancelotti as coach, will be among the top seeds in next season’s Champions League group stage following their title triumph under current coach Stefano Pioli.

However, one of the stars of the title-winning team, Ivory Coast midfielder Franck Kessie, is out of contract and widely expected to join Barcelona.