The Elliott fund has completed the reorganization of Project Redblack, the Luxembourg company which owns 99.93% of AC Milan through Rossoneri Sport Investment Luxembourg.
This was reported by CalcioFinanza.it , which explains in detail the maneuvers of the American fund. The extraordinary shareholders' meeting of the Luxembourg company, which was held on January 29th, first of all acknowledged that the transfer to Elliott, all class C shares were transformed into class A shares (as required by the articles of association).
The new distribution of the capital of Project Redblack is therefore as follows: King George (Elliott) 67%, Genius (Elliott) 28.73% for a total of Elliott of 95.73%. Blue Skye, on the other hand, holds the remaining 4.27%. The shareholders' meeting also amended the bylaws of Project Redblack to take into account the cancellation of class C shares, clearly indicating the economic and governance rights of class A securities (held by Elliott) and class B securities (held by Blue Skye).
The articles of association provide that, with regard to economic rights, Class A shares " will follow the results, performances and returns of all the rights and interests of the company in the underlying Class A assets " or the shareholding in Milan equal 95.67%.
Project Redblack's articles of association also govern the economic rights attached to the class B shares held by Blue Skye Financial Partners. The Class B shares will track the results, performance and returns of all of the company's rights and interests in the underlying Class B assets (the 4.25% held by Blue Skye in transparency through Project Redblack).
The Class A shareholders (i.e. the two vehicles of the Elliott fund) hold control of Project Redblack and a cascade of AC Milan also from the point of view of the governance of the Luxembourg company. The bylaws of Project Redblack in fact provide that the board of directors, whose chairman is designated by the Class A shareholders, decides by majority vote. But in order for every decision to be taken, the favorable vote of two directors designated by the Class A shareholders is required. In other words, the board does not deliberate anything without the consent of Elliott, except for matters reserved by the articles of association, namely the creation or the assignment or decision to continue, any commitment, charge, guarantee or mortgage on any asset or property of the company; the issue by the company of securities, bonds, debt securities or other instruments or the provision or modification of rights relating to such securities, bonds, debt securities or other instruments; the arising of any loans and / or the arising of other liabilities: any changes to the terms and conditions of the tracking preferred equity certificates (TPEC) of any class issued by the Company; any transaction to be entered into by and between the company and any of its shareholders, holders of TPEC or any other subsidiary or affiliate of such shareholder or holder of TPEC; entry by the company into any consulting, contract management or other service contract for an amount involved per contract over EUR 20,000 per year.
The bylaws of Project Redblack provide that " the resolutions of the general meetings of shareholders are validly adopted with the favorable vote of the shareholders representing more than 60% of the share capital of the company (including the positive vote of the shareholders of Class A).
Without the favorable vote of Elliott, who holds more than 60% of the capital and all the class A shares, the Project Redblack shareholders' meeting cannot therefore take any decision. However, there are also reserved matters for the shareholders' meeting that require unanimous consent between the shareholders: any changes to the company's share capital, the repurchase or / and redemption of any shares; any changes to the statute; the appointment of any person as auditor or qualified auditor (réviseurs d'entreprises) of the company; the decision to dissolve the company and put it into liquidation and the appointment of the liquidator of the company.
