Gerry Cardinale has once again spoken about his plans for AC Milan and his hopes for Italian football, while also offering a comment on the investigation into the club.
If you need to catch up on what happened last month when Casa Milan was raided by the authorities, there are seven key questions related to the case which were answered.
In the meantime while the investigations are ongoing, Cardinale is in a crucial period of planning for Milan’s future beyond the end of the current season, with decisions to make on various issues from the head coach to the transfer window.
One thing the RedBird chief has never hidden is his desire to win and to win consistently, something that has got supporters excited about what might come next.
Cardinale spoke on ‘The Deal’, a Bloomberg podcast, about a number of different topics from his decision to buy Milan to the structure of the deal plus what he plans to do in the coming months and years. PianetaMilan relayed his comments.
Tell us about buying Milan…
“Buying Milan was the hardest thing I’ve ever done, but also the best. But the irony is that it was all self-imposed. I had an entrepreneurial need that I had to satisfy, and it was exactly the kind of thing that we do more and more at RedBird.
“The way that institutionalised finance on Wall Street has evolved, you’re not compensated for that amount of activity, of rolling up your sleeves, of working hard and all that. And I mean compensated not just in terms of money, but also in terms of overall effort.
“I like to play the role of shadow entrepreneur and I like to solve problems with capital. And there happens to be a bit of luck in people’s careers. I happened to find a turning point in the sport that I could never have predicted in 2000/2001.
“If we look back at the last 20 years, we realise that it was really a great fortune. I really found an air gap where I am took off. Now the challenge is to navigate this situation, because now everyone has discovered the sport.”
You were also involved with Toulouse…
“To cut a long story short, Toulouse’s price was around 60 million euros . They were relegated to the second tier. We bought them for 15 million euros within three months.
“Within three months, with Billy, Luke Bornn and our team, our data analysis team, we sold our first player for around 15 million euros. And then, after the first year, we got promoted to Ligue 1. And now Toulouse sails steadily to mid-table and has a very reasonable wage bill.
“That would make you think we would have to spend a lot more to be as mid-table as we are. European football is about spending that incremental dollar of capital better than the next guy.
“Then we invested in Fenway Sports Group during COVID, because I believed in this type of intellectual property and we focused on sport as a rights holder. With FSG I got to know the greats with Liverpool. So that was the next step in the tutorial, and it is It was one of the first deals I made in sports.”
You used a vendor loan to buy Milan…
“Billy Beane has been around AC Milan for several years, and we’ve kind of observed him. But again, you think you know a lot about sports, but then you realise you don’t actually, because of all the feedback that you get.
“Every time I brought up the topic of AC Milan internally or here in the United States, everyone said, ‘You’re crazy.’ ‘Don’t ever think about investing in Italy.’ But the answer to your question is that, in the end, there we found ourselves going around the circle.
“Elliott was the owner of Milan. Milan was in debt, originally there was a Chinese owner, who made a mess and Elliott came in, enforced the pledge and became owner. So, initially he’s not someone you would associate with owning a club in the sports world. I think Paul would tell you that.
“But I have to say the thing that changed my mind was meeting Paul and Gordon Singer, his son, who led the investments and team at Elliott. And I can’t say enough good things about them.
“I am very knowledgeable about how they did a phenomenal job in the four years they owned Milan, from 2018 to when we bought it in 2022, to restore it.
“We own 100% of the capital with a vendor loan. And we bought Milan in a very interesting way. I think we paid a fair price, especially in relation to other prices you see.
“We bought it at a multiple four times revenue and when we bought it it was just below cash flow positive or breakeven. Now cash flow is significantly positive.”
What do you think of Milan’s growth?
“Obviously, performances help. We reached the semi-finals of the Champions League. When I took over, it was a challenge because they had just won the Scudetto. So, actually, I took a different approach to what I do usually: for the first year I didn’t do anything. Really, I just watched. But I’ll tell you that the best thing you can do is not go into the field with guns blazing.”
A new stadium is also in your plans…
“It will be the first built in Italy since 2011. It will be an American-style stadium, with 70,000 seats. We will bring music to Milan and build something. A great live event, an entertainment campus for Milan, truly linked to the team, but something similar to Milan.
“It’s interesting, because we’ll have to find a way to crystallise the value. But it’s something that you should probably own forever, which is the height of iconicity and opportunity, as a platform.
“And we’ll build this new stadium. When we finish building the stadium, I promise you that we will have a company that will build stadiums.”
TV rights is a big issue in Italy…
“Milan is truly one of the most important clubs. I believe they are one of the top four brands globally in football. And now, with the breaking down of barriers thanks to streaming and the possibility of broadcasting these matches in the United United live, the younger guys today know everyone, not just the Premier League.
“I can only tell you that I received more comments from people, people I know, people I didn’t know, when we bought Milan from New York and the United States United than from Europe. TV rights will also be an evolution. There is not much competition for TV rights in Europe.”
