The Rossoneri had been strongly linked with the high-profile duo after allowing some top earners to leave the club, but their owner has now quashed any talk of big-money moves.
Speculation has linked the club with a move for the out-of-favor Balotelli, and the Italian side was also in talks with Real Madrid about the possibility of bringing Kaka back to the San Siro, but Berlusconi revealed that his club may not have the finances to pull off either move.
"Neither Balotelli nor Kaka will arrive at Milan. These are impossible deals in times like this," Berlusconi said speaking on Radio 2 in Italy.
The Rossoneri are currently attempting to downsize financially, having allowed Zlatan Ibrahimovic, Thiago Silva and Alexandre Pato to leave in the past few months, but the club had been strongly mooted as a destination for the unsettled Balotelli, who is a lifelong fan of the club.
A move for former fan-favorite and 2007 FIFA World Player of the Year Kaka would likely be welcomed with open arms by the fans, but it now also looks unlikely in light of Berlusconi’s comments. AC Milan CEO Adriano Galliani also claimed recently that negotiations with Real Madrid over Kaka broke down because of the finances involved.