Alessandro Giudice, an expert in football finance, expresses his beliefs supported by facts at Corriere dello Sport. In his analysis the future of Gerry Cardinale's Milan.
In a context in which football is increasingly moving towards the business dimension, the financial strategies adopted by clubs and their owners acquire fundamental significance.
Among these, refinancing becomes a key tool for managing often delicate economic balances. Recently, the focus has been on RedBird and the financial management of one of the most successful clubs in the world: AC Milan.
The context
The financial context in which RedBird entered Italian football dates back to 2022, the year in which the almost total purchase of AC Milan shares by the American fund Elliott took place. By paying 600 million directly to Elliott and having the remainder financed through a vendor loan, RedBird has laid the foundations of a complicated but advantageous economic-financial scheme. This structure is not unusual in the world of acquisitions, but deserves specific observation for the long-term effects it can have on the management and financial balance of the club.
Refinancing
The refinancing announced by RedBird has shattered the air full of speculation that hung around Milan's finances, turning the spotlight on a maneuver carried out eight months ahead of the pre-established deadline of the end of June. According to football and finance expert Alessandro Giudice, the rumors of a possible disengagement of Cardinale, driven by doubts about the ability to raise the necessary funds and alleged management tensions, have achieved a clear defeat through this operation. Consequently, the hypothesis of a saving intervention by third parties, among which the name of the Carlyle fund had been mentioned, was substantially denied. Thus, the expert begins
Strengthened relationships and a substantial difference with the Zhang case
According to Giudice, the recent refinancing movement should not be interpreted solely as a defensive maneuver. In fact, thanks to it, RedBird made a further investment of 170 million, improving its debt ratio and raising its equity in the operation, reinforcing trust with Elliott and CEO Gordon Singer. It is also important to distinguish the type of financing obtained by RedBird for the acquisition of Milan from other similar cases in the world of football, such as that of Zhang with Inter. These are the unequivocal words of Alessandro Giudice on the matter:“Many have compared the RedBird vendor loan to the financing that Zhang obtained from Oaktree, laying the foundations for his dispossession from control of Inter, but these are radically different operations. On the one hand, the (partial) financing of an acquisition into which RedBird still paid 600 million of its own resources; on the other, a survival loan, aimed at obtaining liquidity for the functioning of the club's current management. It is no coincidence that the rate offered by Oaktree was 12% against the 7% offered by Elliott to Cardinale“.
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