AC Milan is ready for its long, strange sale saga to end
A Chinese group led by businessman Sonny Wu appears to be closing on a €750 million ($825 million) takeover
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London: For AC Milan, a much-discussed Chinese takeover can not happen quickly enough.
A seven-time European champion, the team has spent the last half-decade in the doldrums. It has missed making the Champions League for four straight years and hasn’t been able to attract the talent that could reverse its fortunes.
There have been several reports of a coming sale over the past two years, only for nothing to materialize. Now, a Chinese group led by businessman Sonny Wu appears to be closing on a €750 million ($825 million) takeover. The team’s owner, former Italian Prime Minister Silvio Berlusconi, recently said a deal is close and that the Chinese buyers have committed to invest €400 million into the club over the next two years.
An injection of fresh capital could clear the way for Milan’s resurgence and allow the team’s front office to execute plans that have been stuck while the ownership saga rumbled on. It will also help to reassure the club’s patient corporate sponsors that the team is on track to return to the top.
“The investment suddenly allows you to restructure the team greatly and also restructure the organisation,” Jaap Kalma, Milan’s commercial director, said by phone. “The strategic decisions have been difficult to make, and a number of investments have been held back.”
Berlusconi bought Milan in 1986 and turned it into one of football’s iconic teams and a perennial power. The billionaire’s lavish spending in the early years helped lure some of the sport’s top talent, players who in turn drew an army of followers around the world.
Milan remains popular in China, where the Italian league was the first high-level football to be broadcast by state television. Globally the club claims to have more than 380 million followers, a number bettered by only five or six other teams, according to Kalma.
The international visibility means annual commercial revenues of about €100 million from long-term sponsorships with Adidas AG, Emirates and others. Still, the recent years of disappointing play—last season’s 10th place league finish was the team’s worst since 1997—has led to some tough conversations with corporate partners.
“It’s something that slowly but surely is hurting,” Kalma said. “There’s obviously a moment they become anxious as well.”
Appeasing sponsors is not just a problem for Milan. Kalma pointed to Manchester United’s recent hiring of Jose Mourinho, a Portuguese coach with a history of creating winning teams in the short term, after a consecutive season of failure. United’s commercial operation is considered one of the biggest and most sophisticated in soccer, and with that comes high expectations.
“It’s not for nothing Manchester United chose Mourinho—they want to get results quickly,” Kalma said. “If you have pushed your commercial potential to that extent your partners expect returns.”
The team leaves for the US this week, where it will play the first of three matches in the International Champions Cup against Bayern Munich in Chicago on 27 July. Bloomberg