Chelsea plunged into crisis as UK imposes sanctions on Roman Abramovich

Chelsea Football Club has been plunged into crisis after the UK leveled sanctions against its owner Roman Abramovich, putting its sale on hold, restricting attendance at matches and jeopardising sponsorship deals.

The UK government on Thursday imposed an asset freeze on the Russian billionaire, blocking him from selling the English Premier League club he has owned since 2003.

Chelsea, holders of the Uefa Champions League and Fifa Club World Cup, two of the most prestigious titles in club football, is now subject to a range of restrictions designed to prevent Abramovich from benefiting from his ownership of the club.

The sanctions highlight the risks associated with the rise of politically connected billionaire owners in English football while raising questions about Abramovich’s legacy at Chelsea, where many fans praise him for bankrolling the team’s success over two decades.

“What happens post-Abramovich should have been on people’s minds,” said one senior football executive. “The huge problem with the benefactor model is what happens afterwards.”

The government’s move against Abramovich imposes heavy restrictions on Chelsea, banning any new revenue-raising activity and forcing it to freeze any funds it receives, including broadcast revenue and money from competing in the domestic league and European competitions.

Only payments that are essential to the operation of the club are permitted. The club’s physical and online stores cannot operate, while the sale of merchandise such as replica shirts is only permitted by third parties that have already acquired stock.

Telecoms group Three, the Premier League side’s main shirt sponsor in a deal that runs until 2023, is reviewing its contract because it is no longer able to make regular payments to Chelsea, according to people briefed on the matter.

The Three logo will remain on the club’s shirts, because it is a condition of the deal that the team has the right to use it for the full duration of the contract.

Although Chelsea can continue to pay players, other staff and bills, it cannot pay fees or dividends to Abramovich, while a government official confirmed that he is unable to sell the club “at this time”.

The official said the government “would consider an application for a license” to sell the club but that Abramovich would not be allowed to benefit from the sale while he is under sanctions.

Under the current license the transfer or loan of players in and out of the club is not permitted.

The planned sale of Chelsea had attracted the interest of high-profile billionaires including former Apollo Global Management co-founder Josh Harris, co-owner of the Los Angeles Dodgers baseball team Todd Boehly and a consortium led by the Ricketts family, which owns the Chicago Cubs baseball side.

Abramovich had tasked Joe Ravitch, co-founder of US boutique merchant bank Raine, with handling the sale process.

“It’s unprecedented,” said an executive at a rival club, warning that Chelsea may lose players who are out of contract in the summer if ownership problems cannot be resolved. “The bigger issues have to be existential rather than operational.”

The government has also put a limit of £ 20,000 a game on how much Chelsea can spend on travel to and from fixtures.

Abramovich’s Fordstam entity, through which he owns Chelsea, has almost £ 1.5bn in debt in the form of loans from the billionaire, although he has previously said he would not seek to be repaid.

Chelsea said it planned to approach the government to discuss the scope of the license that allows it to continue operating, and would seek “permission for the license to be amended in order for the club to operate as normally as possible”.

Both Chelsea and the Premier League said the club’s fixture against Norwich on Thursday would go ahead.

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