Inter sale: What takeover by American fund Oaktree means for the Serie A champions

It’s a historic day for Inter and Serie A football, as American fund Oaktree Capital Management has taken ownership of the Serie A champions after Inter’s owners defaulted on a loan, failing to repay it within this deadline. week. The US fund took control of the team from Chinese conglomerate Suning Holding Group Co. after Inter’s holding companies “were unable to pay 395 million euros ($428 million),” Oaktree said in a statement.

Former Inter president Steven Zhang and Suning purchased a 68.7% stake in the club in 2016 and took out a €275 million loan at 12% interest from Oaktree to support the club following the COVID pandemic in 2021 and the amount increased to almost €400 million that needed to be repaid this month. Zhang tried other ways to repay the debt, such as involving other funds such as Pimco in negotiations and another possible loan, but failed.

Over the weekend, the former Inter president released a strong statement to “address speculation about the financial stability of our club” before accusing Oaktree of a “lack of meaningful involvement”. Oaktree confirmed the acquisition Wednesday in a statement.

“As of May 22, funds managed by Oaktree Capital Management, LP (“Oaktree”) have assumed ownership of FC Internazionale Milano. This follows the non-repayment of Oaktree’s three-year loan to Inter Milan’s holding companies which has matured on May 21, 2024 with a total balance due of approximately 395 million euros.

“In May 2021, with Inter forecasting record financial losses during the 20/21 season, Oaktree provided its holding companies with bailout capital to stabilize the Club’s financial position and allow it to continue to operate, including to pay its players and employees. In the years since the Oaktree rescue financing, Inter have won their eighth and ninth Coppa Italia, secured their sixth, seventh and eighth Supercoppa, won their 20th Scudetto title and historic second star, and reached the UEFA Champions League final for the first time since 2010.

“Oaktree is committed to achieving the best outcome for Inter’s long-term prosperity, with an initial focus on the operational and financial stability of the Club and its stakeholders. Oaktree values ​​the Club’s legacy, players’ passion, loyalty of Interisti and the Club’s significant role in Milan, Italy and the global sporting community Oaktree is committed to working closely with Inter’s current management team, partners, the league and governing bodies to ensure the Club is positioned to success in and out of the game. pitch; focusing on robust management, operations and governance with a vision of sustainable growth and success.”

Suning acquired Inter in 2016 and started a great revolution at the club that brought players like Romelu Lukaku (Suning’s most expensive signing), Lautaro Martinez and the current team that has just won the Serie A title after an incredible and exciting season under under the command of coach Simone Inzaghi. Under Zhang, Inter won two Serie A titles (in 2021 under Antonio Conte and this season), two Coppa Italia and three Supercoppa Italianas, becoming the second most decorated president in the club’s history, after Massimo Moratti.

With the Covid-19 pandemic, however, everything changed, as the club began to suffer financial problems that led Suning to ask for rescue capital from Oaktree to stabilize Inter from a financial point of view. Furthermore, the Chinese government has halted its interest in investing in football, both inside and outside China. The other Suning-owned football club, Jiangsu, went bankrupt in 2021.

What comes next?

Looking to the future, there will be no major changes at the club in the short term, as Oaktree promised in an official statement. Inter will continue to work in the same way with the same management led by Inter CEO Beppe Marotta, who arrived at the club in 2018 and brought the Nerazzurri back to winning titles. The Nerazzurri will continue to work with the same transfer and player exchange strategy as in recent years, with a focus on the club’s financial stability, while the main priority will be the new contracts of players such as Nicolò Barella and, mainly, captain Lautaro Martinez. , with the current agreement ending in 2026.

It is not yet clear how long the fund will be in charge of Inter, as the main priority will be to find new owners in the future, a similar situation to what another US-based fund, Elliott, did with AC Milan. It’s fair to say that the example of Inter’s rivals is not very similar to this, as the clubs themselves are in completely different competitive situations, with Inter coming off a Scudetto whilst Milan have struggled. This means that for Oaktree to achieve its objective of finding the best owners for the club’s future, the clear way to do so is to continue the success of recent years.