A group of Chinese investors is one step closer to completing its takeover of AC Milan after president Silvio Berlusconi approved the preliminary contract concerning their purchase of the club.
The CEO of Berlusconi's holding company Fininvest, Danilo Pellegrino, and Han Li - representative of the group of investors - signed a contract which would see the incumbent owner's 99.93 per cent stake sold.
Both parties aim to complete the takeover by the end of the calendar year as they await the green light from the Italian and Chinese authorities.
"Mr Silvio Berlusconi, chairman of AC Milan, has approved the preliminary contract signed by Mr. Danilo Pellegrino, CEO of Fininvest, and Mr Han Li, representative of a group of Chinese investors, concerning the purchase of the entire stake owned by Fininvest in AC Milan equal to 99.93 per cent," an official Fininvest statement reads.
"The binding contract between the parties will be completed by the end of 2016, subject to the obtaining of applicable authorisations from the Italian and Chinese authorities. The agreement values AC Milan at EUR740million with an estimated indebtedness of approximately EUR220m.
"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 EUR350m over a three-year period.
"The agreement also requires the acquirers to make a EUR100m deposit, confirming the commitments assumed, of which EUR15m is payable upon signing and EUR85m within 35 days of signing.
"During the entire negotiation process, the signature of the contract and the undertakings assumed thereby, Fininvest has always had as a priority the objective which was clearly stated by Mr Berlusconi: to provide AC Milan, through an appropriate ownership structure, with greater financial resources now more essential for competing with the top football clubs of the world."
Berlusconi has been in charge at Milan since acquiring the San Siro side in 1986.
Milan won eight Serie A titles, one Coppa Italia, five European Cups two Intercontinental Cups and the Club World Cup during Berlusconi's rein.