Forbes: RedBird's AC Milan will deliver 'quicker returns' than Todd Boehly's Chelsea

Forbes: RedBird’s AC Milan will deliver ‘quicker returns’ than Todd Boehly’s Chelsea

Forbes, the American magazine explained why AC Milan who are now owned by American company RedBird will deliver quicker returns and results than Chelsea who were just also purchased by American billionaire Todd Boehly and Clearlake capital.

Chelsea is more profitable than AC Milan, which likely posted slightly positive operating income (earnings before interest, taxes, depreciation and amortization) in 2021 versus perhaps more than $40 million in operating income for Chelsea. But the English team for years was being financed by its Russian owner, while the Italian side, after Elliott Management pushed its balance sheet into the black, is self-financed. Thus the new owners of Chelsea are going to have to rein in expenses while trying to keep the team at the caliber demanded by the Champions League.

RedBird knows a thing or two about buying football teams on the cheap. It acquired the Toulouse FC two years ago for about $20 million, and sports bankers peg the team’s value at about $80 million as it has climbed from France’s third division to winning the second division in just two years. That works out to a fourfold increase in value in just two years.

In contrast to RedBird, Boehly has a history of paying up. He was part of the group that bought the Los Angeles Dodgers for a then-record amount of $2 billion in 2012. Forbes most recently valued the Dodgers at $4.08 billion—a doubling in return over a decade.

In the long term, AC Milan and Chelsea will both appreciate in value. But the Italian club will likely do so much more quickly than the English one.

Article from: Forbes.com