Chelsea FC Confirms Sale After Russian SanctionsMay 07, 2022, 08:00 AM
As discussed in a previous post, Chelsea Football Club owner, Roman Abramovich, put the club up for sale following the U.K. government’s imposition of sanctions on Russian oligarchs (including Abramovich) with business interests and assets in the U.K. amidst Russia’s invasion of Ukraine. The sale process, handled by The Raine Group in New York, resulted in the winning bid at a value of $3.09 billion coming from a consortium including Americans Todd Boehly and Mark Walter (both part owners of the LA Dodgers) and Swiss billionaire Hansjoerg Wyss.
The sale still needs to receive regulatory and government sign-off which will involve more than the normal review and approval process due to the imposition of the Russian sanctions. Although the sale involves the highest ever agreed value for an English football club (and second-highest global sports team sale behind the $3.2 billion sale of the Brooklyn Nets in 2019), the imposition of the Russian sanctions by the U.K. government will prevent Abramovich from receiving any of the sale proceeds. Accordingly, Abramovich has committed to donating the proceeds from the sale to charities supporting Ukrainian citizens.
With respect to Chelsea FC, this lifts the cloud of uncertainty that has shadowed the club for the past two months as it has been forced to operate under a special license that limited finances and operations. Additionally, as part of the potential new owners’ bid, they have committed to invest an additional $2 billion into the club and its facilities, including stadiums Stamford Bridge and Kingsmeadow which will further increase the enterprise value of the club beyond the $3.09 billion purchase price paid.
While the “forced” sale of the club serves as a reminder that sports cannot escape the overlay of governmental regulation, the swift resolution to the sale process allows Chelsea FC, its supporters, and the Premier League to move forward.