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Volume 6 No. 192


Yonghong Li
Photo: getty images

Italian daily Corriere della Sera claimed AC Milan Owner Yonghong Li is "bankrupt and that his assets will be auctioned off on Taobao," according to CALCIO MERCATO. Taobao is the Chinese equivalent of Ebay and "this is not the first time that investigations have found the patron to be devoid of funds. The China Securities Regulatory Commission declared that an investigation is underway into illegal practices from his holding company Shenzhen Jie Ande. Li bought the club for around €740M last year. He had to "take out a huge loan" from hedge fund Elliott Management in order to complete the sale and reports claim that "not only can he not repay that loan, but he is also being sued by two banks for unpaid debts which has led to his assets being sold to the highest bidder on Taobao." Packaging company Zhuhai Zhongfu has been valued at €60M ($74.4M), of which Li’s holding company owns just under 12%. The "most disturbing finding" in the report, however, is the fact that Li was "already insolvent by the time he took over full control of the club last April" (CALCIO MERCATO, 2/19). FOOTBALL ITALIA reported former AC Milan CEO Adriano Galliani belives Li provided "all the necessary credentials" to prove his financial stability. Galliani: "Yonghong Li invested €740 million to buy Milan. We were assisted by a very important advisor and a famous law firm, as was Yonghong Li. Not only did he buy Milan, but another three important things happened. First of all, he presented the credentials to the Lega Calcio and was approved. Secondly, the Elliott fund loaned Mr. Li over €300 million, so they must've made their own evaluations. Finally, over the summer, a transfer campaign worth €200 million was completed, giving all the necessary financial guarantees and bank bonds that the Italian rules demand. I don't know the reality of what is happening in China, but one plus one plus one makes three, so that's how things have gone so far" (FOOTBALL ITALIA, 2/19). 

The club's owning company, Newcastle Rugby Ltd., regularly loses more than £2M per year.

The Scottish Rugby Union is "so keen to gain a foothold in the top flight of English club rugby that it is pursuing the possibility of buying a share" of up to 20% of Premiership Rugby side Newcastle Falcons, according to Owen Slot of the LONDON TIMES. The SRU looked at buying Worcester Warriors this season, "but it has now set its sights on Newcastle, a club where there is already a long history of Scottish players." There are "only" two professional teams in Scotland, which is why the SRU wants to expand its playing base. It also hopes that the move will help it "secure more of those players who are qualified to play for both nations." The SRU has "already begun the process of sounding out Falcons." The club's owning company, Newcastle Rugby Ltd., recorded losses of £2.6M in its last set of accounts. It "regularly" loses more than £2M ($2.8M) a year. Falcons Owner Semore Kurdi said that "no formal discussion had yet taken place." Kurdi: "What we are talking about is a marriage and we haven't even gone on our first date." Any "significant change" in ownership would require the consent of the Rugby Football Union and this would be "hard to come by." The RFU is "not in the business of helping its neighbours." The SRU would reportedly be interested in up to a 20% share. If it was to "scale back" its interest to 10% or less, according to RFU regulations, it would not require RFU consent (LONDON TIMES, 2/19).