London: Chelsea is being sold to a consortium fronted by American sports investor Todd Boehly, ending 19 years of ownership and lavish investment by Roman Abramovich until the Russian oligarch was sanctioned and forced to offload the Premier League club.
The sale price of 2.5 billion pounds ($3.1 billion) is the most lucrative-ever for a sports team worldwide but Abramovich cannot receive the proceeds, which he hopes will go to a foundation for the victims of the war in Ukraine. A further 1.75 billion pounds ($2.2billion) is committed to be invested in the reigning FIFA Club World Cup winners.
Chelsea said Saturday that terms for the buyout had been agreed with a consortium also features Mark Walter, who is also part of the Dodgers group, Swiss billionaire Hansjorg Wyss and funding from private equity firm Clearlake Capital.
The Premier League must approve them as the new ownership and the government has to sign off the new under the terms of the license that allows Chelsea to continue operating as a business through May 31 while one of Abramovich’s frozen assets.
Chelsea expects the deal to be completed by late May.
“Proceeds will be deposited into a frozen UK bank account with the intention to donate 100% to charitable causes as confirmed by Roman Abramovich,“ Chelsea said in a statement.
Boehly is already in London was expected to attend Chelsea’s Premier League match against Wolverhampton at Stamford Bridge Saturday. Thomas Tuchel’s side is third in the standings with four games remaining with the title out of reach but Champions League qualification closer to being secured.
Chelsea has the smallest and most dated stadium of the Premier League’s most successful clubs, with plans for a rebuild of the 41,000-capacity venue put on hold by Abramovich in 2018 as British-Russian diplomatic tensions deepened.
Chelsea said the 1.75 billion pound committed will be in funding investments in Stamford Bridge, the academy and the women’s team, which can win its league title on Sunday.
Boehly is part owner of the Los Angeles Dodgers MLB franchise and he also has minority stakes in the NBA’s Los Angeles Lakers and WNBA’s Los Angeles Sparks.
The challenge will be maintaining the expectation of regular trophies produced under the expensive transformation of Chelsea following Abramovich’s buyout, which led to a 50-year English title drought ending.
Chelsea won 21 trophies in the 19 years of Abramovich’s ownership which is ending abruptly after his assets were frozen as part of British government sanctions as part of a crackdown on wealthy Russians with ties to President Vladimir Putin following the invasion in Ukraine in February.
Chelsea had won the league title only once — in 1955 — when Abramovich bought the club in 2003. Helped by a number of expensive signings, the club won the Premier League title two years later and has 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 Abu Dhabi investment since 2008 and Saudi Arabia’s sovereign wealth fund bought Newcastle last year.
No details have been provided about the future day-to-day leadership of Chelsea, which was the first Premier League club to benefit from mega-rich foreign investor in 2003.
Boehly, who studied at the London School of Economics, co-founded the Eldridge Industries investment firm in 2015 and serves as its chairman and CEO. The private holding company has investments in over 70 businesses, including in sports, entertainment and media.
Besides the Los Angeles Dodgers, Boehly has minority ownership stakes in the NBA’s Los Angeles Lakers, WNBA’s Los Angeles Sparks, the esports organization Cloud9 and DraftKings, an American fantasy sports wagering company.
He is chairman of Security Benefit, a retirement solutions provider based in Topeka, Kansas, and MRC, an entertainment company that funds and produces film and television programming, including such major shows as the Golden Globes, the American Music Awards and Billboard Music Awards.
MRC’s other holdings include Penske Media, which owns Billboard, Rolling Stone, Variety and the Hollywood Reporter.
Before he co-founded Eldridge, Boehly was president of Guggenheim Partners. Walter, who teamed up with Boehly to buy Chelsea, is CEO of the financial services firm.
Their first chance to see Chelsea win a trophy is next Saturday. Liverpool is the opponent in the FA Cup final at Wembley Stadium.