One of the first shots of Todd Boehly at Stamford Bridge was of the American shaking his head after Chelsea blew a two-goal lead to Wolverhampton Wanderers in early May. The 46-year-old will be hoping it is not a sign of things to come.
The real work for Boehly, though, is only just beginning. His consortium arrives at the Premier League outfit with a to-do list that includes making the club profitable, potentially redeveloping its stadium and satisfying a fanbase that during Roman Abramovich’s tenure became accustomed to trophy-laden seasons.
As Chelsea’s new owners wrap up their UK£4.25 billion (US$5.2 billion) takeover, SportsPro looks at the journey that got them there and what is next for the Blues in the post-Abramovich era.
How did we get here?
Russian oligarch Abramovich announced on 27th February that he was handing control of Chelsea to the club’s foundation trustees in the wake of Russia’s invasion of Ukraine. The 55-year-old intended to remain owner of the team, though would not be involved in any decision making.
That plan was swiftly derailed as the threat of sanctions from the UK government meant Abramovich had to change course. The club was put up for sale on 2nd March.
‘Please know that this has been an incredibly difficult decision to make, and it pains me to part with the club in this manner,’ Abramovich said in a statement. ‘However, I do believe this is in the best interest of the club.
‘I hope that I will be able to visit Stamford Bridge one last time to say goodbye to all of you in person.’
Abramovich, who instructed New York-based merchant bank the Raine Group to handle the sale, pledged to wipe out his UK£1.6 billion (US$2 billion) loan to the club and promised that any proceeds would go to a charitable foundation ‘for the benefit of all victims of the war in Ukraine’.
Chelsea won 19 major trophies under the ownership of Roman Abramovich
Who was interested?
Given their west London location and success on the pitch, Chelsea have not been short of affluent admirers. Boehly, who in the last 12 months has invested in businesses such as Fanatics and Sportradar, while also showing interest in the Denver Broncos, was among the first to be linked with a takeover.
The process hit a snag when Abramovich’s UK assets were frozen, meaning Chelsea have been subject to a transfer ban, blocked from negotiating contracts with existing players and sponsors, and barred from selling new tickets to fans. The club has only been able to fulfil fixtures, pay staff and have existing ticket holders at games courtesy of a special licence from the government, which also enabled the sale to proceed.
Undeterred, more suitors entered the fray. Former British Airways and Liverpool chairman Martin Broughton, Chicago Cubs owners the Ricketts family, Boston Celtics co-owner Steve Pagliuca, British property tycoon Nick Candy and Saudi Media Group all lodged their candidacy. Ineos boss Jim Ratcliffe also tabled a late offer on 29th April.
The groups were joined by various high-profile backers. Notably, Boehly drafted in former chancellor of the exchequer George Osborne, while Pagliuca added Maple Leaf Sports & Entertainment (MLSE) chairman Larry Tanenbaum to his bid. Not to be outdone, Broughton’s bid, which was reportedly backed by Crystal Palace co-owners Josh Harris and David Blitzer, secured support from World Athletics president Lord Sebastian Coe, seven-time Formula One world champion Lewis Hamilton and tennis great Serena Williams. Candy, meanwhile, turned to Chelsea legend Gianluca Vialli.
Abramovich had vowed not to rush the sale. But given the evolving situation in Ukraine, coupled with the Blues’ temporary government licence expiring at the end of May, the process had to be fast-tracked.
Who won the race?
Despite the countless names that originally expressed an interest, the list was soon whittled down to only a handful of serious bidders. Prior to Ratcliffe’s late charge, the Raine Group trimmed the shortlist to the groups led by Boehly, Broughton, Pagliuca and Ricketts at the end of March.
The Ricketts family withdrew on 15th April after reportedly being unable to finalise the composition of their consortium offer, with fan backlash also denting their prospects. Ratcliffe maintained his interest despite Ineos director Tom Crotty revealing the initial proposal from Britain’s richest man suffered a “rapid rejection”.
Boehly’s group was named the preferred bidder at the start of May, handing them the chance to wrap up the most lucrative sports club sale in history. Chelsea confirmed the purchase agreement on 7th May, meaning a buyer had been found a little over two months after Abramovich put the club on the market.
Premier League approval arrived late on 24th May, with the UK government issuing a licence to permit the sale the following morning.
Who are the new owners?
A minority owner of Major League Baseball’s (MLB) Los Angeles Dodgers and chief executive of the Eldridge Industries investment firm, Boehly is the face of Chelsea’s new ownership group. He also has stakes in the National Basketball Association’s (NBA) Los Angeles Lakers and Women’s National Basketball Association’s (WNBA) Los Angeles Sparks, as well as other businesses across sports, technology, media and entertainment. An alumnus of Guggenheim Partners, the 46-year-old has a personal net worth of US$4.5 billion, according to Forbes.
Boehly had tried to acquire the Blues in 2019, meaning a good chunk of due diligence on the club had already taken place, aiding efforts to get a deal done quickly.
Joining Boehly as a main partner is private equity group Clearlake Capital, which brings significant financial muscle. The California-headquartered company’s stake could rise to approximately 60 per cent, though the PA news agency reports the consortium has agreed to a number of clauses in the sale designed to protect Chelsea’s future. Founded in 2006, Clearlake has more than US$72 billion of assets under management.
Mark Walter (left) and Hansjörg Wyss are part of Boehly’s consortium
Boehly’s Guggenheim links mean the firm’s chief executive Mark Walter is also part of his group. Walter helped set up Guggenheim, which holds more than US$310 billion under management, and is the controlling partner of the Dodgers, which Guggenheim Baseball Management bought for US$2.2 billion in 2012. Forbes pegs Walter’s net worth at US$3.9 billion.
Under Walter’s stewardship, the Dodgers have won eight consecutive West Division titles, as well as their first World Series in 22 years in 2020. Chelsea fans will be hoping that pedigree translates across the pond as the club aims to add more trophies post-Abramovich.
Another billionaire and the final major player in the consortium is Switzerland’s Hansjörg Wyss, who founded medical device manufacturer Synthes Holding in 1999. He has also worked in the textile, steel and aviation industries. Forbes places the 86-year-old’s net worth at US$5 billion.
In a statement announcing the takeover, Chelsea said: ‘Of the total investment being made, UK£2.5 billion will be applied to purchase the shares in the club, and such proceeds will be deposited into a frozen UK bank account with the intention to donate 100 per cent to charitable causes as confirmed by Roman Abramovich.
‘In addition the proposed new owners will commit UK£1.75 billion in further investment for the benefit of the club.’
The Boehly consortium has also reportedly agreed to clauses that block the payment of dividends or management fees until 2032, also barring the sale of any Chelsea shares for ten years.
Chelsea could be on the hunt for a new shirt sponsor after Three asked to suspend its deal
What happens next?
As for how the club takes shape, The Times reports that Bruce Buck is set to remain the Blues’ chairman as part of a new-look board. He will be joined by Boehly, with House of Lords member Daniel Finkelstein and public relations executive Barbara Charone coming in as non-executive directors. Chelsea director Marina Granovskaia is also expected to stay on, ensuring additional continuity.
Beyond that, Chelsea will no doubt be looking forward to resuming normal business activity having operated under several restrictions during the sales process. Indeed, it looks like Boehly’s commercial team will have to find a new front-of-shirt sponsor after telecommunications company Three asked to suspend its deal worth a reported UK£40 million (US$48.9 million) per year. Sponsorship valuation platform Turnstile estimated the inventory could be worth as much as UK£43.4 million (US$53.1 million) per season.
Despite the new owners’ combined wealth, and Boehly’s willingness to spend at the Dodgers, it would still be a surprise if Chelsea continue to operate as they have done for nearly 20 years. According to Front Office Sports (FOS), the club posted losses in 14 seasons under Abramovich, who snapped up the team for around UK£140 million (US$171 million) in 2003. The Russian also lent Chelsea a further UK£1.6 billion and had to deny reports he wanted it repaid – a move that could have crippled the club. According to FOS, Chelsea also racked up operating losses of around US$1.1 billion since the 2003/04 campaign.
Abramovich’s billions bankrolled the Blues to the top of the club game, helping them to 19 major titles. However, it also created a frequently unwieldy business. Boehly and his confidants will be looking to find a new balance where success and stability are more closely entwined.