U.S. hedge fund Elliott Management announced Tuesday it has assumed control of indebted Italian football club AC Milan and will inject 50 million euros ($59 million) to help stabilize the club’s finances.
Following the new deal, Elliott would become the majority owner of the storied club which has fallen on lean times since former owner Silvio Berlusconi sold his shares to Chinese businessman Li Yonghong with the help of Elliott.
The hedge fund also pumped additional money to Li’s team to fund the purchase of players and repay the club’s debts with banks.
However, Li failed to repay Elliott, paving the way for legal action that could see Elliott become the new owner of the seven-time European champions.
Li has been looking for months for new investors to share the financial burden of the loss-making club, which last month was banned from next season’s Europa League competition because of a breach of Uefa Financial Fairplay Rules (FFP).
Elliott, which plans to inject further capital over time, said it aims to run a sustainable operating model that respects the FFP.
AC Milan, who last won the Serie A in 2011, is said to have closed the financial year to the end of June with a loss of 75 million euros.
They finished sixth in the 2017/18 Serie A season, but will not be featuring in Europe following the ban.