Davis Polk & Wardwell and Gibson, Dunn & Crutcher are advising longtime private equity clients Elliott Advisors U.K. and RedBird Capital Partners on the sale of AC Milan Football Club—the latest example of the growing presence of private capital in professional sports in Europe.
The deal, which values the club at €1.2 billion, will see RedBird take majority control from Elliott Advisors, which has owned AC Milan since 2018.
Elliott will retain a minority financial interest and seats on the board of directors, according to a statement from the club.
The transition to new ownership will take place over the summer, with an expected closing no later than September 2022, according to the club.
Associazione Calcio Milan, once owned by former Italian Prime Minister Silvio Berlusconi, is one of the biggest names in European soccer and just won this year’s Serie A title in Italy.
Elliott Advisors is an arm of Elliott Management, the U.S.-based private equity house founded and run by Paul Singer. It currently has $51.5 billion in assets under management, according to its website.
New York-based RedBird, run by Gerald Cardinale, manages about $6 billion, according to its website. The firm is a shareholder in Fenway Sports Group Holdings, the owner of the English Premier League club Liverpool FC and the Boston Red Sox baseball team in the U.S.
RedBird also holds a controlling stake in the French football team Toulouse, which it bought in 2020 in a deal on which Gibson Dunn also advised.
The Davis Polk corporate team for Elliott, all based in New York, includes partners William H. Aaronson and Darren M. Schweiger. Partner J.W. Perry is advising on finance, and partner Frank J. Azzopardi on intellectual property.
The Gibson Dunn corporate team for RedBird is led by New York-based partners Richard Birnsk and Stefan dePozsgay and included New York-based partner Sean McFarlane. Partners Doug Horowitz in New York and Ben Myers in London are advising on finance aspects. Partner Attila Borsos in Brussels is advising on antitrust aspects and partner Maurice Suh in Los Angeles on sports law aspects.
Private capital has been driving a dealmaking spurt in professional sports in Europe over the past three years. The investors bring large sums to clubs that may need fresh cash for facilities or player salaries; in return, they tap into the current value of a well-known brand, the potential for a financial turnaround, or both.
The wave started in 2019, with the sale of OGM Nice, a Ligue 1 French club, for a reported €100 million to Ineos, a British resources company owned by the billionaire investor James Ratcliffe.
In November 2019, Silver Lake, a major private equity firm based in Silicon Valley, paid $500 million for a 10% stake in Manchester City in November 2019 in a deal that valued the English Premier League club at around $5 billion.
In late May, a consortium including the private equity house Clearlake Capital concluded a deal to buy Chelsea Football Club for $3.1 billion from Roman Abramovich, a Russian oligarch who was sanctioned by the U.K. government as part of its response to the war in Ukraine.