NYON: AC Milan, former world, European and Italian champions have been banned from continental competition next season for breaching UEFA’s financial fair play regulations.

Milan, who had qualified for the Europa League, had spent more than £175m last year on new players despite questions over the financial stability of the Chinese-led consortium that purchased the club from Silvio Berlusconi for £600m in April 2017.

Some of the problems stemed from when they took a loan from US private equity fund Elliott worth more than £263m that club chairman Li Yonghong had struggled to pay back.

The club added, in a public statement of defence ahead of the ruling by the European federation: “We invested more than €200m to open up a new era. A year later, the value of the investment remains unaltered and the value of the squad is the third highest in Serie A.

“We secured qualification to the Europa League group stage and reached two finals of the Coppa Italia (both senior squad and youth team).  We are requalifying the Milanello training ground and taking part in the next season of the Women’s Serie A league.”

Earlier this week it emerged that the club was a possible purchase target for two separate US consortia.

One is the from the Ricketts family, owners of Major League Baseball (MLB) franchise the Chicago Cubs, the other is from Rocco Commisso, the billionaire owner of US second-tie club New York Cosmos.

Commisso is reportedly backed by US financial services company Goldman Sachs in his approach, and says that he is “ahead of Thomas Ricketts in the Rossonero club race”.