This time last year there was so much hope at AC Milan. Just as the likes of Manchester City, Chelsea, Paris Saint Germain and even cross-city rivals Inter had been taken over by rich foreign investors, they too had secured a Chinese owner. Following a long and drawn-out process, Yonghong Li finally took over from Silvio Berlusconi in May last year with the promise of restoring the club to its former glory.
In a wave of optimism, Milan sporting director Massimiliano Mirabelli set about splashing the cash in order to build an entirely new team, committing to spending over €240 million in the summer transfer window. One of those acquisitions sent shock waves around the Italian football landscape, when Juventus and Italy defender Leonardo Bonucci agreed to make the switch to San Siro, the move giving off the biggest signal yet that the Rossoneri were serious about their comeback.
Just over one year later, the Italian giants have seen their club repossessed by American hedge fund Elliott Management, a so-called “vulture find” who specialise in rescuing bankrupt or near bankrupt companies. The story of how this came to be was outlined in this previous post but – however this bizarre story unravelled – it is truly shocking that a con artist such as Yonghong Li was able to take over one of the world’s biggest football clubs.
“Ownership and control of the holding company that owns AC Milan has today been transferred to funds advised by Elliott Advisors (UK) Limited (“Elliott”),” read a statement issued on Tuesday evening.“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.
Il presidente a Milanello insieme alla sua famiglia: guarda la gallery 📸👉🏻
“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.”
The default that was mentioned in the statement was not for the full €303 million that was borrowed by the Chinese businessman back in April 2017 in order to raise the necessary funds for the sale, but a comparatively small amount of just €32 million that was recently borrowed in order to increase cash flow into the club. This proves just how little money Yonghong Li actually had, his facade as a similar wealthy owner to those at the aforementioned teams simply a sham.
In the short term, Elliott have promised to inject €50 million into the club to keep it operating, but it remains unlikely that the Rossoneri will replicate last summer’s spending unless a new buyer comes in. The reference to FFP in the statement takes a swipe at the previous cowboy owner, whose business plan saw Milan excluded from the Europa League for the forthcoming campaign.
The documents presented by Yonghong Li and his associates quite rightly were cause for huge concern for UEFA and reportedly contained wildly fluctuating figures that did not seem at all credible. The sooner that Elliott can take steps to rectify this situation and steady the ship, the better for everyone concerned.
This was the news that all AC Milan supporters ultimately feared, that their owner who arrived with such promise had faked his way to owning the San Siro giants. This whole episode will be one to forget, but at least now they can sleep a little more soundly knowing that their club is out of the hands of someone who had no business owning it.
