Italian newspaper Corriere della Sera is reporting that Milan and Highbridge Capital Management have signed an agreement that gives the parties an exclusive window of eight weeks to come up with a binding deal that will refinance the punitive deal presently in place with Elliott Management.
Milan was sold to a Chinese consortium earlier this year and part of the financing came from Elliott Management with repayment of $357M (€303M) plus interest estimated at $55M (11.5% / € 47M) due by October 2018. Default on the debt and Elliott Management would assume ownership of the team. (Exchange rate of 1.18 $ to €)
Calcio Finanza provided a list of the additional conditions attached to the Elliott Management deal:
- Lien on all assets on all AC Milan trademarks
- Lien on all intellectual property
- Lien on the revenue account of the Banca Popolare di Milano
- Lien on credits from various commercial contracts and sponsorships
- Lien on credits from media contracts
- Acquisition of Milan’s archive of data, images, videos, etc
- Acquisition of 100% of Milan Entertainment Srl
- Acquisition of Milan Entertainment commercial and sponsorship contracts
Highbridge Capital Management, owned by JP Morgan, will now review the Milan business plan in detail and undertake any other due diligence that may be required.
If the five-year deal is consummated, it would be worth $472M (€400m) with the ownership group, Rossoneri Sport Investment responsible for $295M (€250m) and the club entity Milan on the hook for $177M (€150m).
If Business Plan targets are met, then another $118M (€100m) could be made available.
The Milan financial statements for the 2016 year recorded a loss of $85M, which brought Milan’s cumulative loss to nearly $600M over the last 11 years. The first six months of this year to June 30, 2017, showed a slight improvement but the loss still amounted to $38.5M (€32.6M).
The new owners have indicated that the financial year going forward will end on June 30.
Just a few months after the purchase, Forbes valued Milan at $802M, making the team the 13th most valuable soccer team in the world. In 2007 Forbes listed Milan as the fifth most valuable soccer club in the world at $824M.
This weekend Milan plays away to league leaders Napoli who have set a torrid pace with 10 wins and 2 draws for 32 points. Milan trails Napoli by 13 points and is also 9 points behind Lazio who occupy the 4th spot that provides automatic qualification for next season’s Champions League.
Rumors of Milan actively pursuing current Chelsea manager Antonio Conte remain prevalent.
Every footballing classic is full of historic duels: let's relive some of the best ones from #NapoliMilan! br>https://t.co/aAumtyvMri pic.twitter.com/2vP4GU6uBN
— AC Milan (@acmilan) November 16, 2017
