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Hedge Fund Now Owns AC Milan

The ownership saga took another turn Tuesday, with Elliott Advisors Limited announcing Tuesday the company has taken control of the club after the previous owners defaulted on their debt.

“Ownership and control of the holding company that owns AC Milan has today been transferred to funds advised by Elliott Advisors [UK] Limited [“Elliott”],” a statement said.

“This transfer has occurred as a result of steps taken to enforce Elliott’s security interests after the previous owner of AC Milan defaulted on its debt obligations to Elliott.

“Having assumed control, Elliott’s vision for AC Milan is straightforward: to create financial stability and establish sound management; to achieve long-term success for AC Milan by focusing on the fundamentals and ensuring that the club is well-capitalised; and to run a sustainable operating model that respects UEFA Financial Fair Play regulations (Milan have been banned from European competition for one season for failing to comply with FFP regulations).

“Elliott fully appreciates the challenge and responsibility that ownership of this great institution entails. Elliott is pleased not only to support the club during this difficult time, but also by the challenge of achieving ambitious objectives in the future via the on-field success of coach [Gennaro] Gattuso and his players.

“As first measures, Elliott intends to inject €50m of equity capital to stabilise the club’s finances, and plans to inject further capital over time to continue to fund AC Milan’s transformation.”

The statement continued with a quote from Singer.

“Financial support, stability, and proper oversight are necessary prerequisites for on-field success and a world-class fan experience,” the 73-year-old businessman said.

“Elliott looks forward to the challenge of realising the club’s potential and returning the club to the pantheon of top European football clubs where it rightly belongs. Elliott also strongly believes in the value-creation opportunity at AC Milan.”

Even as the club spent lavishly last summer, major questions arose regarding Milan’s finances. In addition to the UEFA financial fair play penalties that barred them from next year’s , there were longstanding concerns as to whether Li Yonghong had the resources necessary to run the club.

Reuters’ Elvira Pollina reported Li failed to repay an outstanding €32 million debt to Elliott, which opened the door for the hedge fund to assume control.

According to Pollina, New York Cosmos owner Rocco Commisso and the Ricketts family, who own the Chicago Cubs, have expressed interest in buying a controlling stake in AC Milan.

The Financial Times’ Murad Ahmed, Rachel Sanderson and James Fontanella-Khan reported Italian businessman Riccardo Silva has spoken with Elliott as well about purchasing a financial stake.