Several newspapers reported on Monday on interesting developments in the world of football. According to sources, the private equity group Thai Prime Company Limited have highlighted its interest in buying the Italian football club AC Milan. The club is currently in the hands of former Italian prime minister Silvio Berlusconi.
Thai Group Makes an Offer
According to Reuters, the private equity firm’s executive director, Bee Taechaubol, had offered to buy a stake in AC Milan, for an estimated $1.14 billion. The business tycoon is after a controlling stake but not a complete ownership of the seven-times European champions. The firm would like a 50% stake in the football club.
Some Thai newspapers argued the businessman had told the deal could be completed as quickly as within the next month, but there weren’t any further comments from the private equity group or mister Taechaubol. Taechaubol is currently acting as the co-owner of the Global Legends Series (GLS) in Bangkok. The series is all about organising charity matches with some of the world’s most famous veteran football players.
Berlusconi Denies Rumour
But Berlusconi told newspapers he isn’t interested in selling his majority stake. According to Fininvest, the holding company that owns AC Milan, the club isn’t currently talking with any potential sellers. Their statement said, “Various parties have shown interest in a partnership involving Milan, but having said that, Fininvest categorically denies the existence of talks of any substance and of any pre-agreement or decisive meetings on the agenda”.
The club isn’t doing very well on the pitch now, as the team hasn’t been able to win Italy’s Serie A premier league title since 2011. It currently sits at 11th position in the 20-team league. But off the pitch, the club isn’t doing as badly, which is why the private equity interest doesn’t come as a surprise to many analysts. Deloitte’s data from last month ranks the club as the 10th richest in world football. AC Milan’s revenue for the 2013-2014 season stood at $250 million.
Private Equity’s Love Affair with Football
Private equity has long roots in the world of football, with the biggest spending spree starting around 2010. The Asian investors have been especially keen to invest in recent years, with Indonesian, Erick Thohir, acquiring a 70% stake in AC Milan’s rival Inter Milan in 2013 with his group.
Another big deal for private equity firms came just a few weeks ago. The Chinese conglomerate, Dalian Wanda, recently acquired the Swiss sports marketing firm from the private equity firm, Bridgepoint. The company controls big footballing tournaments, such as the FIFA World Cup and provided the private equity firm with a hefty $1.19 billion exit.
Big English clubs are also in the hands of private equity groups, with Manchester City being among the most notable. Its owners, the Abu Dhabi United Group, has surely been excited over the recent announcement of the English Premier League TV rights, which has highlighted the league’s position as the best in the world. It remains to be seen whether the Thai private equity firm is actually negotiating with AC Milan or if it’ll end up showing interest to another European football club.