AC Milan signs preliminary agreement with Chinese investors

AC Milan is one step closer to an ownership takeover after club chairman Silvio Berlusconi approved a preliminary contract involving the sale of 99.93 percent of the 18-time Serie A winner to Chinese investors.

The latest club to be buoyed by the influx of Chinese-based interests, Milan is on the cusp of finalising a takeover by management company Sino-Europe Sports Investment and its chairman Yonghong Li.

"The agreement values AC Milan at €740 million with an estimated indebtedness of approximately €220 million," a statement on the club's website announced Friday.

Sale of the club marks an end of Berlusconi's mercurial 30-year tenure with the club after the former Italian Prime Minister vowed to sell his entire stake in the team.

"The president has approved the preliminary contract signed by the general manager of Fininvest, Danilo Pellegrino, and Han Li, representative of a group of Chinese investors, with reference to the total participation - equal to 99.93 percent - held by Fininvest in AC Milan."

Mired in a stretch of uncharacteristic ineptitude that has witnessed the once-continental giant finish no higher than seventh in any of the last three Serie A campaigns, the preliminary contract mandates the revitalisation of the club.

"The agreement requires the acquirers to undertake significant capital increases and liquidity injections aimed at strengthening AC Milan’s financial structure, for a total amount of €350 million over a three-year period (€100 million is to be paid-in at the “closing”)."

The statement continues, saying, "The agreement also requires the acquirers to make a €100 million deposit, confirming the commitments assumed, of which €15 million is payable upon signing and €85 million within 35 days of signing."