Chinese investors buy AC Milan, raising hope among football fans

Global Business

Chinese investors buy AC Milan, raising hope among football fans

Many of Europe’s football leagues have been back in action for the new season. And this weekend, Italy’s Serie A resumes. It has some of the most decorated in footballing history. However, their slide had left fans of Milan’s two clubs fearful that the best days were behind them.

But Chinese investors might just change all that. CCTV America’s Owen Fairclough gave us this report.

Chinese investors buy AC Milan, raising hope among football fans

Chinese investors buy AC Milan, raising hope among football fans

With investments from China, AC Milan other Italian football leagues might be on the rise again as President Xi aims to turn China into a world football power. CCTV America’s Owen Fairclough gave us this report.

AC Milan were unstoppable during the late 1980s and early 1990s. From 1989 when they beat Steaua Bucureşti, AC Milan competed in six European finals and lifted the trophy in three of them. And they were winning back-to-back titles in the Italian domestic league.

And to this day, only Real Madrid has been more successful in European football. And in 2003 and 2007, Milan won the European Cup again.

But its fading fortunes since then reflect a wider problem with Italian football clubs.

So what happened? All the best players left.

Among the first to flee is Zinedine Zidane. Considered one of the greatest midfielders ever, he became the world’s most expensive player in 2001 when Juventus sold him to Spain’s Real Madrid.

Juventus broke the transfer record again this summer, selling another French midfielder, Paul Pogba, to English Premier League giants Manchester United for more than $115 million.

It’s no coincidence that Manchester United and Real Madrid spent the last 15 years swapping places as the richest clubs in the richest leagues, while AC Milan, once the third richest, slid out of the top 10. That left Juventus the sole Italian representative.

“In Italy, owning a soccer club is seen as symbol of social status and has been for many many years,” said Wes Harris, Business of Soccer’s managing editor. “Whereas in other markets, and some of the top markets like the Premier League and la Liga it isn’t just a symbol of social status. They take the mindset and approach of running it as a true business.”

Now, that is all changing as the Chinese football revolution takes off in Italy. AC Milan was bought by an investment consortium for just more than $820 million. And prior to that, Chinese electronics retailer Suning took a 70 percent stake in rivals Internazionale, a three time European Cup winner that has also seen better days.

It isn’t the first takeover of an Italian club. A U.S. investor bought Roma five years go. But Milan and Inter are the most prestigious acquisitions as President Xi Jinping hopes to turn China into a world football power.

Fans say it’s long overdue and that the deal will give the club economic advantages too and will help AC Milan stand on its feet again.

But buying AC Milan has its limitations. The club shares a stadium with Inter that is owned by the city authorities who take the lion’s share of match-day revenues. And while the top Italian clubs earn much more from broadcasting than rivals in other leagues, their visibility has dwindled.

The top English, German and Spanish clubs all sell around two to three times more replica shirts than AC Milan or Juventus. Even so, analysts think there’s plenty of value in these two footballing giants as long as they do what former Milan owner and ex-prime minister Silivo Berlusconi stopped doing: spend.

“They need to be able to afford to pay the transfer fees for the best players and pay those players the highest wages,” said David Swan from FootballItalia.net.

As the new season starts, the focus is now on the players who are on the team sheet to do their bit to restore Milan’s clubs to their glory days.