Milan: Cardinale will cover the debt with Elliott over a longer period of time

Gerry Cardinale intends to keep Milan, not to leave the leadership of the club, and is working to refinance the debt contracted with Elliott when he purchased the club. Negotiations between RedBird’s number one and the fund owned by the Singer family began months ago, well in advance of the deadline set in August 2025. The objective is to reach an agreement not close to the gong because, if on the one hand, Elliott has already made his choice when he sold his Rossoneri shares in the summer of 2022, on the other, the New York entrepreneur certainly hasn’t changed his mind on the quality of the investment made when he accepted the 1.2 billion valuation for 100% of the shares. Although he is still looking for his first trophy and the start of his third season has been far from satisfactory in terms of points won in the championship, Cardinale is convinced that Milan will soon find their feet and will obtain the desired results on the pitch. After the successes achieved in many sectors, he is keen to do well in football too. He demonstrated this by closing the market in the last two seasons in deficit for a total of a hundred million. And he is ready to continue along this path if his “reign” continues.

extension

—

To buy AC Milan, RedBird invested 650 million and reached 1.2 billion thanks to a 550 million vendor loan, i.e. a loan that the seller grants to the buyer and which allows a reduction in the financial exposure of the buyer towards the banking system. In practice, it is a deferred payment and not a single payment, a legal and financial instrument that is increasingly used when it comes to purchasing a club, not just football or sports. Especially if the figures at stake are as high as those paid for Milan. Now to those 550 million must be added the interest accrued for a total amount, to be repaid in a single solution (the technical term is “bullet payment”) in just under nine months, which is around 700 million (693 for the precision). And RedBird would like to refinance that sum with Elliott. Entirely or largely, a viable path if new investors prove interested in supporting Cardinale and guarantee equity or money to be immediately transferred to the Singer family.

Cardinale is certainly working on a solution that will allow him to continue the project started in 2022 and has no intention of giving up. Because he had estimated that the operation linked to the Rossoneri club would not produce the desired results over a three-year period. Before founding RedBird, the American entrepreneur worked for a long time for Goldman Sachs, one of the most important investment banks in the world, and became a partner and senior leader managing over 100 billion dollars of private capital. Someone with his experience knew that he would find himself at a crossroads in the summer of 2025 and is convinced that he has the right cards to find an agreement with Elliott, to carry forward his project. Probably until 2028 or for another three years. The new timing of the refinancing is still the subject of negotiation and is clearly linked to the interest rate. It cannot be ruled out that another fund could come into play. In short, there is still work to be done, but the direction taken is clear: Cardinale is not thinking of a disengagement and wants to continue investing in Milan. To help him win more trophies and celebrate no longer as a simple fan, as happened in May 2022 on the occasion of the scudetto.

new stadium

—

What pushes him to move forward is not only the desire to enrich the showcase in via Aldo Rossi, but also the belief that the Rossoneri club, thanks to the last two budgets closed in the black thanks to record revenues in its history (457 million in the last financial year), has great potential. For the value of the brand, which is very strong in America and China, but also because negotiations are underway to build a new San Siro together with Inter next to the current one. It goes without saying that a proprietary plant would increase seasonal revenues, but above all the value of the company. Another reason that pushes Cardinale to relaunch and not leave the table in a historical moment in which the new Champions League formula has increased revenues. This is why the minimum objective set by the management is to qualify for the most prestigious European cup for next season. The negotiation between RedBird and Elliott must be concluded by next August, when the terms of the current vendor loan expire. If Cardinale defaulted, the Singer family would enforce the pledge and regain control of Milan. An eventuality that the current ownership is convinced will not materialize.