US investment fund Oaktree Capital Management has seized control of Italian soccer giants Internazionale (Inter) after that side's previous owner, China’s Suning Group, defaulted on its debt.
Suning purchased Inter in 2016 from previous owner Eric Thohir, restoring the team to on-field success with two top-tier Serie A championships and a UEFA Champions League final appearance in the time since.
Inter was heavily financially impacted by the Covid-19 pandemic, however, and with record financial losses looming Suning took out a substantial three-year loan of €275 million ($297.7 million) in order to ensure the smooth continuation of club operations.
That loan was taken out with a rate of interest at 12%, causing the unpaid balance to skyrocket over the coming seasons to an unwieldy figure of €395 million, far in excess of what Suning would be willing or able to pay off given the conglomerate’s financial woes in China, which led to a sale of 23% of the business to state-backed investors in 2021.
Now, with the period of the loan up, Oaktree has taken control of the club, and stated its intent to continue as club owners rather than seek an immediate sale.
Alejandro Cano, managing director and co-head of Europe for Oaktree’s global opportunities strategy, stated of the business taking control of Inter: “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.
“We are committed to the long-term success of [Inter]…. our aim is to build on the momentum achieved on the pitch to develop a clear path for consistent growth and success.”
Steven Zhang, president of Inter and a board member of Suning Group (which was founded by his father Zhang Jindong), had sought a sale of the club since the loan was undertaken in order to resolve the debt, however, no buyer has materialized.
As it became clear he would be unable to sell the club before the loan reached full term he had also sought loans from other firms to attempt to pay off Oaktree and remain in control at Inter, but to no avail. The businessman stated his disappointment over the weekend, railing against Oaktree for what he called a “lack of meaningful engagement” with Suning’s attempts to resolve the debt.
