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AC Milan takeover completed

This week RedBird Capital closed on its €1.2bn acquisition of AC Milan, placing the American investment group in control of the Serie A champions.

In doing so, founder Gerry Cardinale brought in some long-time associates as minority shareholders, none other than the New York Yankees and a Los Angeles-based investment fund backed by LeBron James and the rapper Drake.

Cardinale, the former Goldman Sachs banker, is seeking to leverage his longtime relationships with celebrity athletes and the Yankees in particular to guide his vision for the Rossoneri. During his time at the investment bank, Cardinale helped start the Major League Baseball team’s regional sports channel, the YES Network, starting a two-decade relationship with the owning Steinbrenner family.

Their closeness informed the Yankees organisation’s decision to take a minority interest in AC Milan, according to people familiar with the matter. But the view from New York, where the 27-time World Series champions remain one of the most valuable clubs in sport ($6bn as estimated by Forbes), is that Milan are still a niche interest that can benefit from the halo of the Bronx Bombers’ brand.

“No one really knows them here”, said one person familiar with the investment. While the Yankees organisation will be limited partners without strategic input in Milan, they plan to help promote the Italian champions by broadcasting match reruns on YES and inviting the Rossoneri to play friendlies at Yankee Stadium.

Cardinale and RedBird are still seeking limited partners to help pay down the €600mn loan from Elliott Management, the previous stewards of AC Milan, to purchase the club. Main Street Advisors, a Los Angeles-based investment group which counts James and Drake as well as Maverick Carter and Jimmy Iovine as backers, joined the minority stakeholders at the close of the deal this week.

While the athletic and entertainment glitterati aren’t direct investors in Milan, Cardinale has shown his ability to follow through on working his existing connections to back his vision. The greater question will be if he can win over Italians.

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