It’s becoming pretty clear that there are two contenders in the race to buy AC Milan from Elliott Management, namely Investcorp and RedBird Capital. However, the process is taking time and there are good reasons for that.
Since Elliott took over the club in 2018, when Yonghong Li defaulted on his loan, Milan have made an incredible journey back to the top. In addition to performing on the pitch, the club’s accounts are now also restored and in very good shape.
The fact that several investment firms are looking at Milan with interest, therefore, makes a lot of sense. As reported by Corriere Dello Sport this morning (via MilanNews), though, it’s a delicate process that Elliott are well on top of.
Per the newspaper, they are currently not waiting on a higher offer from Investcorp or RedBird, but instead they want more guarantees. The key to the takeover is how the sum, which exceeds €1bn, will be paid.
It’s obvious that such an amount won’t be paid in cash or with a check, but Elliott also want to avoid the leverage buyout structure. That is when the buyer takes on debt and puts it on the company, in this case Milan.
Elliott have spent four years restoring the club accounts and thus don’t want to leave the club with debt immediately. Guarantees over more money is the key phrase.