The Case of Boban vs. Gazidis

As promised, because Boban is nothing if not a man of his word, he sued the club for wrongful termination, and he won the first round. His cause is not about money, but rather accountability and integrity. Yesterday, a court awarded him damages of €5.375 million. Meanwhile, Gazidis, being the lawyer that he is, is appealing the decision, and still claims he had "just cause" to fire the Milan legend for ratting out his absurd courting of Ralf Rangnick. That is simply round one in the case of Boban vs. Gazidis.


Integrity vs. incompetence


More shameful than this unnecessary legal battle, the expenses to the club, and the negative press, are the Milan fans who believe that Gazidis is doing a good job at the club. If the secret approaching of Rangnick behind the backs of both Boban and Maldini did not teach us enough about his character, the firing of Boban the day before the Genoa match should have. Or the approaching of the players at Milanello less than 48 hours before they faced Juventus in a semifinal for a trophy, to talk about decreasing wages due to COVID-19. Or the continued and disgustingly public pursuit of Rangnick even when Pioli and the boys were winning. All the way around, Gazidis is nothing like Milan, nor is he even doing his job well.

While Maldini and Boban lowered the wage bill by €25 million per mercato, improved the quality of the team, and fought hard to get the best deals on transfers, too, Gazidis as CEO has not been as fiscally minded. His first financial year at the club ended in a staggering €145 million loss, almost €50 million deeper in the red than the worst Berlusconi year or even Yonghong Li's frivolous year of spending money that wasn't his. Literally half again the amount of the worst fiscal year ever.


Gazidis alone at San Siro, like an evil dictator, watching Milan lose after firing Boban the night before


While that first year was cleaning up the Yonghong Li mess, which accounted for less than half of that deficit, much of the rest of the deficit went to creating the Milan app that no one asked for, "improving" Milanello, and re-painting the dressing room at the San Siro, as well as changing everything from Italian to English. Not even remotely fiscally responsible choices, and certainly not income-building choices, either. 

However, not even the humiliating negotiations with UEFA to accept a year out of the Europa League competition that we more than qualified for on the pitch were enough to reign in Gazidis' spending. This year, Milan's losses were a shocking €195 million. More than double the losses of any year by previous ownerships. €195 million in the red.


Boban was one of the main reasons Ibrahimovic returned

In the Shareholder's Meeting in October, he blamed COVID-19 for the losses, but the figures show that only €35 million of the losses were due to the pandemic. He also claimed the lost revenue of the Europa League, which was only €16 million, and was also caused by prior improper financial management in the first place. To cover up for the other €145 million or so that is not included in those two excuses, he chose that specific meeting to appoint Franco Baresi as Honorary Vice President, a clear deflection from the reality that he is spending us into FFP destruction, with nothing to show for it. But no one is asking questions, because Baresi. Also, if you know anything about these meetings, all questions from shareholders must be asked in advance and pre-approved/chosen by the club to be answered.

According to the actual balance sheets, consolidated revenues were down 20% for the year, despite a very small increase in sponsorships. Operating costs of the club were inexplicably up by €5 million, despite reducing the costs of both player and directors' salaries in the technical sector. But hey, at least Milan's kit sales are probably helping Puma increase revenue, despite their inferior quality kits. Certainly, they are not helping Milan's bottom line. It is unclear how or why the club is actually still hemorrhaging cash, and the one person who is responsible for running the club and should be answering to this incompetence is Ivan Gazidis.


One of these men is not like the other

While the business side of Milan is finally growing with sponsorships, after the losses in his first year at the club, they have done very little to impact the club's bottom line thus far. In fact, income from sponsors only improved about €55 million this past fiscal year. The RocNation deal, which is unprecedented, has more to do with making and building connections outside of sport than it does to benefit our profits. The recent fashion venture with RocNation-owned Paper Planes only featured a very limited collection, and an auction with our suit sponsor Harmont and Blaine is actually a fundraiser for Fondazione Milan. We now have an official coffee, but what kind of cash is that bringing in?

So far, most of the sponsorship deals seem to be more about brand growth than income, but the Milan brand has actually been strong for years, even during the last ten years when the club was depreciating on and off the pitch. The companies who sponsor Milan have far more to gain by associating themselves with Milan than the club stands to gain in the reverse. In fact, you could still argue that the players, coach, technical directors, and sporting sector in general have done far more to increase both profits and brand awareness than Gazidis or his entire business side have in the year 2020. 


Boban brought World Cup final experience to the club, as well

In this sense, in the case of Boban vs. Gazidis, Boban did more to help Milan's profit margins in his eight months at the club than Gazidis has done in two years. While Gazidis has reigned as CEO, the sporting side has exponentially increased in value. In fact, since October, the actual value of our collective players has increased by over €40 million, according to Transfermarkt. Maldini & Boban also saved the club over €50 million in wages over their two transfer windows alone. Milan boast the youngest team in Europe, and the only team in Europe undefeated in the league, not only this season, but since the return of football this year. Milan look like strong candidates to qualify for the Champions League next year, which will bring tens of millions Euros of revenue to the club. From the sporting side. Ibrahimovic has greatly contributed to that probability, and he cited Boban's influence on his decision to return to Milan in the first place. Boban's effect on the club is still positive, nine months after being fired by Gazidis.

Luckily, Gazidis did leave some money in this upcoming year's budget that was approved in October, to cover the legal expenses and payout to Boban, which tells us that he knows he is in the wrong, too, although he's willing to spend more in legal fees and take up more of the courts' valuable time fighting a lost cause. Lost cause, not just cause. Meanwhile, in that budget, our third year of a three year FFP period which will be assessed next October, we are €340 million in the red in an allowable €30 million "break even" amount. Which means that, during the continuing global pandemic, with no fans allowed in the stadium, and no appreciable amount of income increases on the horizon, Milan have to find an extra €310 million in income to cover the past two years' losses alone between now and June.


Gazidis is destroying the beautiful game one club at a time

What happens if we don't? We already know. Milan were excluded from playing in Europe once already for FFP violations. Given the worldwide effects of COVID-19 on clubs all over the world, we can hope that UEFA will be compassionate. However, Milan's losses for the two years exceed the pandemic's impact by nearly ten times the actual amount the club was impacted this past year, so compassion is unlikely. Gazidis' only other chances to redeem Milan are his recent appointments to the ECA Executive Board and UEFA's Professional Strategy Council, in which he had better be really good at making friends in high places. And quickly.

Perhaps we will be lucky enough to be placed in an FFP plan in which we will be required to show drastic improvements or be fined or otherwise penalized. But the problem with that is that Gazidis has shown no indication whatsoever of being able to make that happen. Sure, Elliott are more than willing to cover our losses, and have invested over €600 million in the club in just two years. But UEFA does not care about that. FFP is based on breaking even between revenue in losses, not depending on a wealthy owner to continuously pour money into a club.


The disrespect Gazidis has shown club legends alone is criminal enough, but the balance sheets are terrifying

In the case of Boban vs. Gazidis, not only is Gazidis the astronomically big fat loser, but he is taking the club down with him. He may have taken the integrity of the competent and honest Boban out of the club, but the balance sheets show that Gazidis is neither honest nor competent. And now there is also a deficit in the integrity of the club as well. Milan fans who think anything different are clearly ignorant of actual facts, and should be ashamed for making ridiculous assumptions about someone who treated not only Boban, but also the legendary Maldini so poorly. They should also talk to Arsenal fans. The sporting side may achieve a glorious return to the Champions League, but Gazidis is doing everything in his power to assure that Milan will not be allowed to compete in the competition. Firing Boban was just the tip of the iceberg. That is the case of Boban vs. Gazidis.


This post inspired by the music of NIN's "The Hand that Feeds"


Our next match is
Serie A Week 15
Benevento vs. Milan
Sunday, January 3, 2021 • 18:00 CET (12noon EST)


The Case of Boban vs. Gazidis The Case of Boban vs. Gazidis Reviewed by Elaine on 11:28 PM Rating: 5
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