El­liott is new player in AC Mi­lan deal

New Straits Times - - Sport -

MI­LAN: US pri­vate eq­uity fund El­liott has res­cued for­mer Ital­ian prime min­is­ter Sil­vio Ber­lus­coni’s deal to sell AC Mi­lan, throw­ing a fi­nanc­ing life­line to Chi­nese in­vestors who were strug­gling to com­plete the trans­ac­tion.

Ber­lus­coni’s hold­ing com­pany agreed in Au­gust to sell the club for €740 mil­lion (RM3.5 bil­lion), in­clud­ing €220 mil­lion in debt, to a Chi­nese con­sor­tium.

But China’s US$3 bil­lion (RM13 bil­lion) Euro­pean foot­ball spend­ing spree was cut short by a Bei­jing crack­down on over­seas van­ity deals and the group failed to raise the funds on time, de­lay­ing clo­sure.

El­liott will pro­vide €300 mil­lion in fi­nanc­ing to the Chi­nese con­sor­tium, a lawyer and a source close to the mat­ter said on Mon­day, and the deal is now ex­pected to close on April 14 — eight months and two post­pone­ments af­ter it was agreed.

AC Mi­lan, seven times Euro­pean cham­pi­ons but with­out any ma­jor sil­ver­ware in the past six years, are los­ing money and need a deep-pock­eted in­vestor who can in­ject funds to buy match-win­ning play­ers and in­vest in the brand at home and abroad.

In a wider push to re­duce debt, Ber­lus­coni de­cided to sell the club be­cause he was un­will­ing to stump up the ex­tra money re­quired for the team to com­pete with the top Euro­pean clubs, many now bankrolled by wealthy Gulf and Asian own­ers.

The Chi­nese con­sor­tium, the mem­bers of which have yet to be dis­closed, has paid €250 mil­lion in four tranches to Ber­lus­coni’s fam­ily in­vest­ment com­pany, Fin­in­vest.

A fur­ther €270 mil­lion eu­ros is due on April 14, with the rest of the pur­chase price be­ing paid in the form of as­sumed debt.

El­liott’s fi­nanc­ing deal in­cludes a cash in­jec­tion into AC Mi­lan it­self, as well as help for the con­sor­tium to close the deal.

The US fund will pro­vide €180 mil­lion to com­plete the ac­qui­si­tion and an­other €73 mil­lion to help the club to cover short-term pay­ments, said a lawyer work­ing for AC Mi­lan and Yonghong Li, the en­tre­pre­neur lead­ing the con­sor­tium, con­firm­ing ear­lier re­ports by daily Cor­riere della Sera.

An ad­di­tional €50 mil­lion would be in­vested in the club, bring­ing El­liott’s to­tal ex­po­sure to about €300 mil­lion, said a sep­a­rate source close to the mat­ter.

It was un­clear whether the funds would be made avail­able through a loan, eq­uity or both. Reuters

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