Oaktree take control of Inter Milan after Suning default in €395m debt

May 23 – US-based fund Oaktree Capital Management has formally issued a statement that it has taken ownership of the Serie A champions Internazionale after Suning Holdings Group, led by Steven Zhang, defaulted on a €395 million loan taken out three years ago.

Suning acquired a 68.7% stake in Inter in 2016 and, to support the club after the pandemic, in 2021 borrowed €275 million from Oaktree at 12% interest.

In a statement Oaktree said: “In May 2021, with Inter Milan forecasting record financial losses during the 20/21 season, Oaktree provided its holding companies with rescue capital to stabilize the Club’s financial situation and enable it to continue operating, including to pay its players and employees…

“Oaktree is dedicated to achieving the best outcome for the long-term prosperity of Inter Milan, with an initial focus on operational and financial stability for the Club and its stakeholders…

“Oaktree is committed to working closely with Inter Milan’s current management team, partners, the league and governing bodies to ensure the Club is positioned for success on and off the pitch; focusing on robust management, operations and governance with a vision for sustainable growth and success.”

At the weekend Zhang had issued his own statement criticising Oaktree for refusing to participate in discussions to restructure the loan with alternative investors.

Discussions for alternative finance, with US fund Pimco looking ready to do a deal, foundered on Oaktree’s deliberate lack of co-operation, said Zhang. The end result being that Oaktree have taken control of one of Europe’s most storied clubs at a knockdown price.

Alejandro Cano, managing director and co-head of Europe for Oaktree’s Global Opportunities strategy, said: “As new owners, we recognize our responsibility to Inter Milan’s community, history and legacy. 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. Winning the second star was a pivotal moment for the Club and our aim is to build on the momentum achieved on the pitch to develop a clear path for consistent growth and success.”

Oaktree take control of a club at the top of their game having won the Serie A this season and in the 2020/21 season, as well as finishing runners-up in the Champions League last season.

It is unclear whether Oaktree intend to hold on to the club (they are investors, and fund managers, not operators of sports clubs), and with Inter having a valuation of about €1.2 billion, it is more likely they will cash out at potentially three times the value of their initial loan.

Contact the writer of this story at moc.l1721242895labto1721242895ofdlr1721242895owedi1721242895sni@n1721242895osloh1721242895cin.l1721242895uap1721242895