Milan have not won the scudetto since 2004 and owner Silvio Berlusconi's frugal approach to transfers during the global economic crisis meant there was little hope of the Rossoneri threatening perennial champions Inter Milan until now.
The Italian prime minister said in July that the prospect of a move for former Inter striker Ibrahimovic was unlikely because the Swede might not fit into the dressing room.
A few lacklustre pre-season performances later under new coach Massimiliano Allegri and Milan have shifted their thinking on the eve of the new Serie A season to try to avoid another third-place finish in the league.
"With a man like that upfront, Milan can close the gap," AS Roma coach Claudio Ranieri, who led his side to a close second behind Inter last term, told reporters.
Ibrahimovic was the talisman for Inter's 2007, 2008 and 2009 scudettos but his first season at Barcelona was mixed, allowing seven-times European champions Milan to pounce.
"All of us at Milan have to thank Silvio Berlusconi for the economic force he has put into the deal," Milan chief executive Adriano Galliani told reporters on announcing the transfer.
Milan were losing 70 million euros a year before selling Kaka to Real Madrid in the last close season for 67 million.
Millionaire tycoon Berlusconi said such losses were unacceptable in times of austerity and at first allowed just a free transfer and low-key loans in this transfer window, including the bizarre recruitment of Kevin Prince Boateng.
WORKED WONDERS
Genoa bought the Ghana midfielder from Portsmouth and then immediately loaned him to Milan, who planned to buy him outright from their Serie A rivals once finances picked up.
Galliani has worked wonders to convince Barcelona to accept a similar deal over Ibrahimovic whereby he is on loan at Milan for the first season before the Rossoneri have the right to buy for 24 million euros.
The figure is significantly less than Barca paid for him last July in a swap deal with Inter involving Samuel Eto'o which was valued around 66 million euros.
Despite Milan's cleverness in keeping the cost of the transfer down, some experts believe the move is evidence of Milan admitting that the policy of only signing journeymen and relying on the waning talents of Ronaldinho did not work.
"It's panic buying at the end of the tranfer window. Milan and Berlusconi have become desperate," Professor Chris Brady, dean of London's BPP Business School and a former semi-professional footballer, told Reuters.
"I don't understand this deal, I really don't."
Part of the reason for the perplexity is Ibrahimovic's past at city rivals Inter, whose fans are bound to give the Swede a rough ride in the San Siro derbies this season.
The 28-year-old was a hero with Inter but quit last year saying he had won everything he could in Italy and needed the challenge in the Champions League.
Inter had their revenge on him by winning the Champions League
