AC Milan will officially change owners next month and clarification has arrived regarding the terms of the deal between Elliott Management and RedBird Capital.
MilanNews note that there has been speculation in recent weeks about RedBird only taking a majority stake in the club and not all of the shares, with Elliott therefore remaining with a stake in Milan, but in actual fact Gerry Cardinale’s fund will acquire all of the shares.
They will do so for a value of €1.2bn which is the valuation set by Elliott Management from the start. Therefore they will be the majority shareholder except for the shares held by the Small Shareholders.
Elliott will remain on the board of directors under the Vendor Loan contractual arrangement, which gives Elliott the power to appoint up to two representatives on the board. A Vendor Loan is a loan from the seller to the buyer and in this case can be up to €600m with an interest rate around 7%.
It essentially functions as a deferred payment and therefore excludes the inclusion of a third party such as a bank. Therefore, the Singer family will not have equity interests, but will be in an economic partnership with RedBird.