Oaktree Took Control of Inter Milan After Previous Owner Defaulted on Loan

Oaktree Took Control of Inter Milan After Previous Owner Defaulted on Loan

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Oaktree took control of Inter Milan after Suning Holding Group Co. failed to repay its loan amounting to $428 million. According to Oaktree, the collateral backing of the loan was a majority stake in the Italian team.

Inter Milan, a team that finished second in last year’s UEFA Champions League and clinched Italy’s top domestic league this season, is set to embark on a new chapter under Oaktree’s ownership. A source close to the matter revealed that the new owners have strategic plans to enhance the club’s representation on the board of directors, which signals their commitment to the club’s future success.

Oaktree, an asset management firm with a staggering $192 billion in assets, has a proven track record in acquiring and reviving struggling soccer teams. In 2020, it successfully undertook this task with Stade Malherbe Caen of France, a venture that demonstrated its prowess despite Oaktree’s subsequent sale of its shares. Steve Kaplan, co-founder of Oaktree, is also an investor in Swansea City, a Welsh side, further underscoring their deep involvement in the sport.

Oaktree Took Control of Inter Milan

Oaktree Took Control of Inter Milan After Previous Owner Defaulted on LoanAccording to sportsbook pay per head companies, a creditor’s takeover of a Milan soccer team is likewise not unprecedented. After the former owner of AC Milan, the second leading team in the city, failed to pay its debts in 2018, Elliott Management converted the debt into stock in the club.

Before Tuesday’s Oaktree loan due date, Suning had been in debt refinancing discussions with Pacific Investment Management Co. for Inter, but the two parties could not agree.

For China, the pinnacle of their engagement in European soccer came in 2016 when Suning acquired Inter. Numerous Chinese oligarchs bought shares in illustrious European clubs in response to a government initiative to modernize the sport in China. Aston Villa and Atletico Madrid, among others, have lost spots due to financial difficulties at home.

Oaktree’s Inter Milan Takeover

Suning received crucial funding from Oaktree in 2021, a move that significantly bolstered Inter’s finances during the challenging period of pandemic-related stadium closures. Documents signed at the time and seen by Bloomberg News clearly outlined the lenders’ rights to enforce Suning’s pledge, including the immediate seizure of collateral in the event of default. This decisive action by Oaktree has provided much-needed stability to Inter Milan’s financial situation.

Many debts remain unpaid for Inter after the Oaktree acquisition. One of these is a €415 million high-yield bond offered to institutions and due to maturity in early 2027. The company that has the rights to broadcast and sponsor the Inter Media and Communication SpA team is issuing such notes. A portion of the proceeds goes toward paying back the bondholders, and then some of the remaining funds go to the other parts of the organization.

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