Chelsea’s forced sale comes to an end after attracting the highest price for a 2.5 billion pound ($3.1 billion) sports team from a consortium led by Los Angeles Dodgers co-owner Todd Boehly .
There are still potential stumbling blocks to the sale of Roman Abramovich’s asset, frozen by sanctions against the Russian oligarch. The British government must approve the terms and make sure Abramovich does not profit, even if he appears to want to divert the profits to charity.
Hours after buyout terms were agreed and announced, Boehly had a disheartening introduction to life as an English Premier League investor when Chelsea blew a two-goal lead to draw with Wolverhampton 2- 2 Saturday.
Boehly was watching at the team’s stadium in Stamford Bridge, west London, which needs some of the 1.75 billion pounds ($2.2 billion) that potential owners have pledged to invest .
Chelsea fans have grown accustomed to lavish funding over the 19 years under Abramovich’s ownership, with over $1 billion in net player spend helping the men’s team win 21 trophies.
But Abramovich was forced to offload the club after he came under fire in the British government’s crackdown on wealthy Russians linked to President Vladimir Putin after the launch of the invasion of Ukraine in February.
Abramovich, who did not condemn the war, cannot benefit from the sale. The billionaire – before at least being sanctioned – initially said the proceeds would go to a foundation for war victims, but he became less specific.
After several rival offers were rejected, Chelsea agreed to a deal with a consortium that includes Boehly with Dodgers principal owner Mark Walter, Swiss billionaire Hansjorg Wyss and funding from private equity firm Clearlake Capital.
“Profits will be deposited into a frozen UK bank account with the intention of donating 100% to charitable causes, as confirmed by Roman Abramovich,” Chelsea said in a statement.
The Premier League must approve them as new owners, and the government must sign under the terms of the license which allows Chelsea to continue operating as a business until May 31 while being one of the frozen assets of Abramovich.
Abramovich has said he will write off loans of more than 1.5 billion pounds ($1.9 billion) to Chelsea, but that has been complicated by sanctions put in place by the British government. Abramovich’s team has positioned him as a potential peacemaker, but that lead has gone silent in recent weeks.
Chelsea, whose ability to sell match tickets and commit to further spending on players has been hampered by the sanctions, expects the sale to be complete by the end of May.
Thomas Tuchel’s side are third in the standings with three games to play. The title is out of reach but Champions League qualification is all but assured despite losing points on Saturday.
“Not relieved,” Tuchel said of the potential sale, “but it gives us perspective if the terms are agreed, and hopefully the process will be streamlined and continue as soon as possible. Good news.”
Chelsea have the smallest and most dated stadium of the Premier League’s most successful clubs, with plans to rebuild the 41,000-seater site put on hold by Abramovich in 2018 when Anglo-Russian diplomatic tensions deepened .
Chelsea said the £1.75billion pledged will be used to fund investment in Stamford Bridge, the academy and the women’s team, which can win their league title on Sunday.
In addition to co-ownership of the MLB Dodgers, Boehly also owns minority stakes in the NBA’s Los Angeles Lakers and the WNBA’s Los Angeles Sparks.
The challenge will be to maintain the expectation of regular trophies produced as part of Chelsea’s costly transformation, with 21 collected in 19 years.
Chelsea had only won the league once – in 1955 – when Abramovich bought the club in 2003. Aided by expensive signings, the club won the Premier League two years later and added four more since then, most recently in 2017.
There is increased competition from wealthy owners to buy and retain players. In England alone, Manchester City has benefited from investments from Abu Dhabi since 2008 and Newcastle was bought by the Saudi sovereign wealth fund last year.
No details were provided on the future day-to-day management of Chelsea, who were the first Premier League club to benefit from a mega-wealthy foreign investor in 2003.
Boehly, who studied at the London School of Economics, co-founded investment firm Eldridge Industries in 2015 and serves as its chairman and chief executive. The private holding company has investments in more than 70 companies, including in sports, entertainment and media.
Besides the Los Angeles teams, Boehly has minority stakes in esports organization Cloud9 and DraftKings, an American fantasy sports betting company.
He is president of Security Benefit, a retirement solutions provider based in Topeka, Kansas, and MRC, an entertainment company that finances and produces film and television programming, including major shows such as the Golden Globes, American Music Awards and the Billboard Music Awards.
Other MRC holdings include Penske Media, which owns Billboard, Rolling Stone, Variety and The Hollywood Reporter.
Prior to co-founding Eldridge, Boehly was chairman of Guggenheim Partners. Walter, who partnered with Boehly to buy Chelsea, is the financial services company’s CEO.
Their first chance to see Chelsea lift a trophy is next Saturday in the FA Cup final. Liverpool are the opponents at Wembley Stadium.
Chelsea’s $3.1 billion cost dwarfs the $2.3 billion paid in 2018 for the NFL’s Carolina Panthers.