Roman Abramovich to sell Chelsea: Russian oligarch confirms $5.5b departure from EPL club
Russian billionaire Roman Abramovich has confirmed that he is selling EPL club Chelsea, with a startling plan for the proceeds. Here is what the seismic decision means.
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The Chelsea owner Roman Abramovich has confirmed that he is selling the club he has backed for 19 years.
In a statement on the club website he said: “I have stated before, I have always taken decisions with the club’s best interest at heart. In the current situation, I have therefore taken the decision to sell the club, as I believe this is in the best interest of the club, the fans, the employees, as well as the club’s sponsors and partners.
“The sale will not be fast-tracked but will follow due process. I will not be asking for any loans to be repaid. This has never been about business nor money for me, but about pure passion for the game and club.
“Moreover, I have instructed my team to set up a charitable foundation where all net proceeds from the sale will be donated. The foundation will be for the benefit of all victims of the war in Ukraine. This includes providing critical funds towards the urgent and immediate needs of victims, as well as supporting the long-term work of recovery.
“Please know that this has been an incredibly difficult decision to make, and it pains me to part with the club in this manner. However, I do believe this is in the best interest of the club.
“I hope that I will be able to visit Stamford Bridge one last time to say goodbye to all of you in person. It has been a privilege of a lifetime to be part of Chelsea FC and I am proud of all our joint achievements. Chelsea and its supporters will always be in my heart.”
The Russian tycoon values the club at £3 billion ($5.5 billion) and, with his ownership of Chelsea under the spotlight as a result of Russia’s invasion of Ukraine, the process is understood to have already begun. A number of billionaires have been sounded out as to their appetite to buy Chelsea.
According to reports by Sky News, Abramovich has approached The Raine Group, a New York merchant bank, to oversee the sale, and they are targeting US and Asian buyers. It is believed they will ask interested parties to declare their hands by mid-March.
The Ineos billionaire Jim Ratcliffe has previously expressed an interest in Chelsea, though he believes Premier League clubs are overvalued.
Abramovich is reported to have put his London residences on the market this week as well as seeking to sell Chelsea. Any sale of the club could, however, be impeded if sanctions are placed on him — as was suggested should happen by the Labour leader, Sir Keir Starmer, at prime minister’s questions on Wednesday.
In the past Abramovich, who has loaned the club £1.5 billion during his tenure, has resisted multiple attempts to buy Chelsea, reportedly rejecting offers in excess of £2 billion for the European champions. But Russia’s invasion of Ukraine has opened the door to potential buyers because of the threat of government sanctions.
The Swiss billionaire Hansjorg Wyss, who is worth a reported £3.8 billion, has claimed he has been offered the chance to buy the club and would be interested in investing as part of a consortium. According to reports in Blick, Wyss and Todd Boehly, owner of the LA Dodgers who tried to buy Chelsea in 2019, are considering a bid.
“Abramovich wants to get rid of Chelsea quickly,” the 86-year-old told the Swiss newspaper Blick.
“I and three other people received an offer on Tuesday to buy Chelsea from Abramovich. I have to wait four to five days now. Abramovich is currently asking far too much. You know, Chelsea owe him £2 billion. But Chelsea has no money. As of today, we don’t know the exact selling price.”
On Wednesday Everton resisted calls to sever all links to Alisher Usmanov — the Russian billionaire who is the club’s biggest sponsor and who has now had his assets frozen by the European Union. The Merseyside club did choose, however, to suspend all commercial relations with the Russian’s companies, USM, Megafon and Yota.
Bryant, the former chairman of the all-party parliamentary group for Russia, has already called for Abramovich to condemn Russia’s invasion or face having his UK assets seized, having questioned whether the 55-year-old billionaire should be allowed to remain Chelsea’s owner.
Abramovich responded to that on Saturday with what has proved a questionable attempt to hand stewardship of the club to the trustees of Chelsea’s charitable foundation. The move has run into difficulties already because of potential breaches of UK charity law.
Bryant was questioning the time it has taken the government to impose sanctions on Russia’s super-rich when the EU has already acted.
“Roman Abramovich, well, I think he’s terrified of being sanctioned, which is why he’s already going to sell his home tomorrow, and sell another flat as well,” Bryant said. “My anxiety is that we are taking too long about these things.”
Wyss, who founded the medical device firm Synthes USA, added that he could consider a deal for Chelsea only with a clutch of investment partners. “I can well imagine starting at Chelsea with partners. But I have to examine the general conditions first. But what I can already say: I’m definitely not doing something like this alone. If I buy Chelsea, then with a consortium consisting of six to seven investors.”
The situation is causing considerable anxiety at Chelsea, with the head coach, Thomas Tuchel, becoming emotional when asked about the situation at a press conference. He was repeatedly questioned about Russia and Ukraine and its impact on Chelsea.
“Listen, you have to stop, I am not a politician,” he said. “You have to stop, honestly. I can only repeat. I feel bad to repeat it because I never experience war. So even to talk about it I feel bad because I am very privileged. I sit here in peace. I am doing the best I can but you have to stop asking me these questions. I have no answers for you.
“You always start the question with the same sentence: ‘We know there are much more important things than football but …’ You also decide to ask me about war, and how often do I need to say it? It is horrible. Of course it is horrible. It cannot be any other opinion about it, but why should we be more distracted about it than you at work?
“We try to create an atmosphere to come to work and focus on our work, which is our passion, so we are very grateful and very privileged to have it and it is not that big a problem.
“But of course, everybody in Europe more or less has some noise in his head that nobody likes and it is maybe the same for you, and still you try to do your job as good as possible, and it is the same for us.”
Abramovich’s UK investor visa expired in 2018 shortly after the poisonings of the Skripals in Salisbury, which prompted the UK government to cancel work visas for some Russian businessmen. He has since obtained Israeli and Portuguese citizenship and is a less frequent visitor to Britain than in the early years of his ownership of Chelsea.
Everton’s Ukraine international Vitalii Mykolenko on Tuesday slammed the Russia captain, Artem Dzyuba, and his “shithead teammates” for not speaking out against Putin’s invasion.
“Whilst you remain silent bitch along with your shithead football teammates, peaceful civilians are being killed in Ukraine,” Mykolenko wrote in an Instagram post.
BIG QUESTIONS ANSWERED
– By Martyn Ziegler
Why is Roman Abramovich selling the club now?
There is probably a short window of opportunity before the threat of being sanctioned and having his UK assets frozen becomes reality. If his assets are frozen then strictly speaking he would be unable to sell the club and recoup the £1.5 billion he is owed in loans.
What is the British government’s position on Abramovich and Chelsea?
Boris Johnson has refused to discuss individual cases but highly placed figures in sport believe the government is giving Abramovich time to sell the club before adding him to the list of sanctioned Russian oligarchs, because they do not want the move to impact on the club’s fortunes and anger the supporters.
Why does sanctioning appear to be on the cards for Abramovich?
There is considerable political pressure for that to take place. On Wednesday, the Labour leader Sir Keir Starmer asked at prime minister’s questions: “Roman Abramovich is the owner of Chelsea and various other high value assets in the UK. He’s a person of interest to the Home Office because of his links to the Russian state and his public association with corrupt activity and practices. Why on earth isn’t he [sanctioned?].”
How much would a potential buyer have to pay?
Abramovich has previously turned down £2.2 billion but he may have to settle for considerably less if he is to achieve a quick sale under these circumstances. The latest accounts for Fordstam Ltd, Chelsea’s parent company, show that Abramovich loaned the club another £19.9 million last season to take the total related-party loans to £1.514 billion. He would want to recoup that money plus any more cash he has put into the club since then. There have been reports that he wants £4 billion but that would seem unachievable even at the best of times.
What other issues are there surrounding the sale of the club?
The stadium is the big one, because it needs massive investment and a £1 billion plan for a replacement has already been shelved. Bob Ratcliffe, who runs the football division at his brother Sir Jim Ratcliffe’s firm Ineos, said in 2019 that it had looked at buying Chelsea but that problems over redeveloping the stadium proved too big. He said then: “The issue with Chelsea is its stadium. We are all getting older and it is a decade of your life to resolve that.”
Why is the stadium so key?
Stamford Bridge has a relatively small capacity of about 40,000, which means Chelsea’s match-day income is far below that of their rivals, such as Arsenal, Tottenham Hotspur and Manchester United, and they must expand to get to the same level. There is also an issue with the Chelsea Pitch Owners (CPO), made up of shareholders, who are mainly fans of the club and who own the freehold with a 180-year lease as guardians of its longevity at Stamford Bridge. It was formed in the 1980s, when Chelsea were under threat from property developers who wanted to turn the stadium into a housing development. For the club to move, they either have to obtain permission from CPO or surrender the name Chelsea FC.
Who is wealthy enough to buy Chelsea?
It would have to be someone rich enough to be willing to inject similar sums into the club as Abramovich has to keep Chelsea among Europe’s elite. Sir Jim Ratcliffe is said to be richer than the Russian so would meet that criteria. Any kind of leveraged buyout would be unlikely to succeed as Chelsea do not generate the kind of profits every year that would be needed to pay the interest. Al-Waleed bin Talal, a Saudi prince, is one of the richest people in the world, with a net worth of £30 billion according to Forbes, so could afford to buy the club and was rumoured to be interested. But he has since distanced himself from a takeover bid and may well have faced resistance from the Saudi state in any case, given that the country’s sovereign wealth fund owns Newcastle United. The Swiss billionaire Hansjorg Wyss has said he has been approached but given that his net worth is £3.8 billion, according to Forbes, it may not be feasible for him to buy the club outright.
If sanctions are imposed on Abramovich and his assets frozen, would he still be able to sell?
That is a question that could make lawyers rich. Chelsea’s and Fordstam’s latest accounts state: “Funding is provided by the ultimate controlling party, Mr R Abramovich.” Fordstam’s debt is owed to a British Virgin Islands-registered company, Camberley International Investments Ltd, according to the accounts. It would theoretically be possible for a company or person outside of the EU to buy Camberley International Investments Ltd from the owner, almost certainly Abramovich, as it is not based in the UK or Europe. The UK government may, however, intervene considering that Fordstam and Chelsea are both British companies.
If Abramovich does not sell and is sanctioned, what would this mean for the running of Chelsea?
He would not be allowed to do any business with British individuals and entities so he could not continue to fund the club or take any money out of it. The club could still operate under the existing structure but it would be difficult.
What about the idea of Chelsea’s charitable foundation taking over the stewardship of the club?
That was announced by Chelsea at the weekend but several of the trustees have serious doubts over whether the Charity Commission would permit it.
Does Abramovich have any other options regarding Chelsea?
He could give it away. For example to a fans’ trust similar to those that operate in Germany, or to his daughter Sofia — who has spoken out against Vladimir Putin over the war in Ukraine. She lives in London most of the time and has attended Chelsea matches.
– The Times
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