Huge question mark hangs over Chelsea’s future

London — European football champions Chelsea are now effectively controlled by the British government after sanctions were imposed against Russian owner Roman Abramovich on Thursday.

Abramovich, who had been under scrutiny after Russia’s invasion of Ukraine, last week announced he was selling the Premier League club last week. That process is now on hold, leaving the west London club, ranked by Forbes as the seventh most valuable in world football at $3.2bn, in a state of limbo, operating under a special government licence.

The Russian bought the club in 2003 for a reported £140m and his investment resulted in the most successful era in their history as they won five Premier League titles, five FA Cups and the Champions League twice.

His purchase of the club helped transform the landscape of English football, with Chelsea breaking the stranglehold of Manchester United, Arsenal and Liverpool. Abramovich had funded Chelsea via £1.5bn in total loans through Fordstam, the entity through which he owns the club.

In their most recent accounts in December, Chelsea, who reported after-tax losses of £145.6m for the year ended June 30 2021, said they were “reliant on Fordstam for its continued financial support”.

Now there is a huge question mark over the club’s future.

A number of potential new owners had emerged in the past week, including several American sports executives, but there is now a block on any sale.

A spokesperson for British Prime Minister Boris Johnson said the block can be lifted in the future if another licence is agreed to. “We would have to grant a further licence. I think it is fair to say the government is open to the sale of the club, but ... currently, it would require another licence and that would require a further conversation with the treasury [finance ministry],” he told reporters.

“The principle has been to mitigate the impact on fans ... these measures are designed to punish those close to [Russian President Vladimir] Putin.”

A source close to Chelsea told Reuters on Wednesday that the expectation within the club is that a deal would be done “sooner rather than later”.

Fixtures

New York investment bank Raine has been handling the sale, and potential buyers will now have to wait to see whether a licence allowing a sale is granted and how any eventual legal action from Abramovich proceeds.

Chelsea are now operating under a special government licence, which allows some exemptions to the asset freeze restrictions, in order to allow the club to fulfil their fixtures.

Chelsea, who are third in the Premier League and in the last 16 of the Champions League, will be able to play their games and pay their players while broadcasters will be permitted to show their matches on television. Only fans who have already purchased tickets or who have season tickets will be allowed to attend matches, the government said, while no new merchandising sales will be permitted.

The club shop has put up a notice saying it is closed due to the latest government announcement.

The club will not be able to enter into transfer deals for new players or receive money for selling existing players — which is effectively a transfer ban. However, the club will be able to continue paying the wages of all employees, including playing and coaching staff.

British culture secretary Nadine Dorries said the moves are aimed at “depriving Abramovich of benefiting” from his ownership of the club.

“I know this brings some uncertainty, but the government will work with the league and clubs to keep football being played while ensuring sanctions hit those intended,” Dorries said in a statement. “Football clubs are cultural assets and the bedrock of our communities. We’re committed to protecting them.”

The Chelsea Supporters Trust (CST), a fans’ group, urged the government to involve fans in future decisions over their club.

“The CST notes with concern the government’s statement regarding the owner. Supporters must be involved in any conversation regarding ongoing impacts on the club and its global fan base,” it said in a statement. “The CST implores the government to conduct a swift process to minimise the uncertainty over Chelsea’s future, for supporters and for supporters to be given a golden share as part of a sale of the club.”

Chelsea, the Premier League and a spokesperson for Abramovich did not immediately respond to requests for comment.

Reuters