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China's Sino-Europe Sports Bid For AC Milan On Verge Of Collapse

The paper trail for an $800M bid by "little-known" Chinese investors for Serie A side AC Milan, leads from Luxembourg, Hong Kong and a "network of shell companies to the deserted 11th floor of the World Trade Center in Changxing," China, according to Jourdan & Pollina of REUTERS. The club announced the sale last August and "it was expected to close by the end of last year." But the bidding group -- identified by Milan's owners as Sino-Europe Sports -- "pushed back the payment of cash installments and is negotiating a further delay in closing the deal." The acquisition, announced at "the height" of China's $3B European football "splurge," has become "something of a lightning rod for Beijing's crackdown on overseas vanity deals as it tries to check capital outflows amid a weaker yuan currency." The bidders paid €200M in three tranches to Milan owner Fininvest. They are "due to pay" an outstanding €320M ($345M) and are "expected to inject a further" €100M ($108M) into the team. A "likely new deadline for payment is April 7." Sources said that as "pressure from Beijing increases on foreign exchange acquisitions, key investors are pulling back." AC Milan announced the sale with no public signing or press conference. The club named two individual investors -- Li Yonghong and Han Li -- along with state-linked Haixia Capital and other undisclosed "state-controlled entities." It is "unclear how many of those remain." One source said that China Construction Bank, one of the "highest-profile known backers," pledged to invest around €150M ($161M), but "backed out of the consortium last month" (REUTERS, 3/22). SKY SPORTS reported the takeover is "on the verge of collapsing" unless the Chinese investors trying to buy the club come up with another €80M ($86.3M) by this weekend (SKY SPORTS, 3/23).

'UNTHINKABLE': FOOTBALL ITALIA reported AC Milan GM Adriano Galliani said of rumors that he "could front" a new takeover, "It's unthinkable that I could do something which isn't shared with President [Silvio] Berlusconi. It's crazy just to think about it" (FOOTBALL ITALIA, 3/22).

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