US investment fund Oaktree Capital Management has taken control of Italian champions Inter Milan after the football club’s previous owners, Chinese conglomerate Suning International Holdings, defaulted on a debt of £335m.
Suning’s debt relates to a loan of €270m taken out in 2021, which has accrued interest at 12 per cent and was due for repayment on Tuesday. The default entitles Oaktree to Suning’s stake, although it must pay for the share according to an independent valuation, minus the debt.
“As new owners, we recognize our responsibility to Inter Milan’s community, history and legacy,” said Alejandro Cano, one of Oaktree’s European chiefs.
“We are committed to the long-term success of the Nerazzurri and believe our ambitions for the club are united with those of its passionate fans in Italy and around the world.
“Our initial focus is operational and financial stability. We have great respect for Inter Milan’s management team and look forward to working closely with them to provide strong leadership for the club.”
The situation has parallels with US hedge fund Elliott Management’s acquisition of Inter’s city rivals AC Milan in 2018 after its Chinese owner defaulted on a €415m debt.
Elliott sold the club to RedBird Capital Partners, minority owners of Liverpool parent company Fenway Sports Group, for €1.2bn four years later.
Oaktree has no experience of operating a club of Inter’s size and it is not clear whether it intends to retain or sell its new asset.
The acquisition comes days before the end of an Italian league season that will see Inter crowned Serie A champions for the second time in three years and 20th in total.
But uncertainty over the European giants’ future has overshadowed their march to the title, with Suning scrambling to refinance the debt or sell up altogether.
Inter chairman Steven Zhang had accused Oaktree of failing to cooperate with Suning’s attempts to avoid having to give up the club.
“In the months leading up to the expiration date of the financing facility with Oaktree, we have done everything possible to find an amicable solution with our partner, including offering multiple opportunities for Oaktree to obtain a full and immediate financial return,” said Zhang.
“Unfortunately, our efforts so far have been exacerbated by legal threats and a lack of meaningful involvement from Oaktree.
“This has all been very frustrating and disappointing, but this behavior is now creating a risky situation for the club that could put its stability in serious danger.”
Oaktree has been contacted for comment on Zhang’s claims.