Inter Milan, the esteemed Italian football powerhouse, currently ranks as one of the top five best performing European teams, but are at a financial crossroads.
Nationally, Inter continues to lead the Series A, where Juventus, the second ranking team, is struggling to keep up.
Despite Inter’s impressive on-field achievements and favorable prospects in the Champion’s League, the club finds itself grappling with staggering debt.
Adding to the complexity of Inter Milan’s finances is the impending bond repayment deadline of May 2024.
The club’s majority owner, Suning, and the Zhang family, a Chinese investor holding a 70% stake, is facing the need to repay a substantial $400 million loan (approximate figure) to OakTree Capital, the US investment fund that provided crucial financial support two years ago, with a substantial annual interest rate of 10%.
Numerous potential investors have been rumored to express interest, but the steep asking price of $1.3 billion by the Chinese owners has deterred any concrete agreements (these numbers are the team’s valuation that was reported at the end of 2023 by different media sources).
As the repayment deadline approaches, Inter Milan stands at a crucial juncture where strategic decisions must be made to avoid potential loss of control.
Which could possibly result in a full American ownership of the team.
Inter Milan At A Financial Crossroads
Several viable alternatives for investors have surfaced, including the Saudi Public Investment Fund (PIF), the Qatari Investment Authority,
Bahrain Investcorp, and the Emirati powerhouse Mubadala. PIF, known for its assertive investments in sports, especially football, has made notable acquisitions of top-tier players and coaches.
It has invested massively on football since 2021 to acquire players such Ronaldo, Benzema, Neymar, and Mane, to privatize 3 of its league’s top teams, and to invest in stadium infrastructures.
It is also investing robustly to secure the FIFA world cup in 2034.
Qatar, owner of Paris Saint-Germain, recently expressed interest in acquiring Manchester United, and in 2022 has successfully hosted the FIFA World Cup which cost the Al-Thani Family (the royal leadership) US$ 220 billion.
Bahrain, the least football assertive GCC country, has been on the lookout for sport assets through its Investcorp. Its appetite for acquiring Italian football teams seemingly increases.
Potential Investors Interested In Inter Milan
Finally, we should not be surprised to see a bid from Emirati Mubadala or through the City Football Group (CFG), the holding company founded by Sheikh Mansour bin Zayed Al Nahyan, the UAE deputy Prime Minister who already controls 12 global football teams.
These potential interest match these countries’ needs to diversify their economies away from oil and gas. Also ensuring a brighter future for their young population.
Speculations aside, the most probable scenario involves renegotiating the loan with OakTree Capital. Or integrating a minority strategic outside investor.
The latter could come from a Gulf Cooperation Council (GCC) country. They would inject a much-needed $300 to $400 million to stabilize Inter’s finances.
This injection could prove crucial for the club’s performance in the national league, the Serie A. It could also enhance their chances of winning the lucrative Champions League.
For potential investors, the club’s distressed finances represents an opportunity to capitalize on the long-term financial and brand potential of Inter Milan.
Inter Milan stands at the intersection of financial challenge and untapped potential. The club awaits a visionary investor to steer the club towards a brighter future.
Suning & Inter Milan Succeeding In Difficult Climate
Despite Inter’s financial challenges, the skillful manner in which Inter Milan has navigated the heightened economic uncertainties brought on by the pandemic must be applauded.
President Steven Zhang (Inter owner), Inzaghi (the Coach), and the Inter Management have exhibited resilience and resourcefulness.
The club has achieved notable sporting success despite constrained resources. Which in turn has positioned the club as a formidable force in both Italian and European football.
The coming months presents challenges, particularly when addressing short-term debt with Oak Tree Capital (the American Leander).
However, Inter’s allure to investors, especially those from oil-rich nations that must diversify their economies, remains strong.
A strategic investor from the Gulf could unlock the full potential of the Inter Milan brand beyond the pitch.
In fact, a new investor could potentially establish a massive fan community, 100 million strong globally.
By: Andrea Zanon
Andrea is Founder of Confidente and Empower Capital. With 25 years of entrepreneurship, operations, sustainability and technology experience,
He is an international advisor who has worked for financial institutions and entrepreneurs on sustainability, international affairs and development
