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03rd Mar 2022

Explained: What happens if Roman Abramovich can’t sell Chelsea?

Reuben Pinder

Roman Abramovich is asking for around £3 billion for the club

On Wednesday evening, Roman Abramovich confirmed rumours that he was looking to sell Chelsea. The Russian oligarch told fans his decision was “in the best interest of the Club, the fans, the employees, as well as the Club’s sponsors and partners.”

What he failed to mention was the impending threat of sanctions from the UK government as Russia continues to invade Ukraine, prompting him to seek to liquidate a key asset to protect his own wealth as well as the future of the club.

His asking price of around £3 billion means the queue of potential buyers will be short and exclusive, with reports suggesting he has already rejected a bid in the region of £2.5 billion.

So what if he can’t sell the club? What if he is hit with sanctions before a sale goes through? We asked Kieran Maguire, author of ‘The Price of Football‘, how Chelsea would be affected in such a scenario.

“Over the last 20 years or so, Chelsea have lost more money than any other club in the history of the PL in that period,” he explains. “Abramovich has lent the club something in the region of £1.5bn via one of his companies in the British Virgin Islands.

“It would be a challenge for the club to continue to run losses of that extent going forwards.”

After 19 years of relying on Abramovich’s money to help bankroll their transfer windows and huge wage bill, Chelsea could be left in the unfamiliar scenario of having a multi-billionaire owner with no access to their money.

In this situation, any owner would “look to cash in on what else is available to sell in order to pay the next wage bill, the next rates bill, the next tax bill,” Maguire says.

“In the case of a football club, that is often players. You are of course constrained by the fact you’ve only got two transfer windows in a year. There will potentially be players out of contract on June 30, who under normal circumstances might be offered renewals – the club may have to reconsider A) whether they will do that and B) what level of wages they are prepared to pay.”

In real terms, this could mean the likes of Antonio Rudiger, Cesar Azpilicueta and Andreas Christensen all being let go on free transfers in the summer, when their contracts expire.

Is there a precedent for this kind of situation?

Not exactly, but Maguire cites Liverpool’s problems in the 2009/10 season under the ownership of Hicks and Gillett, whose leadership saw the club struggle financially.

“It was a case of: find a new buyer or run the risk of going out of business.”

“The same scenario also arose in respect of Aston Villa, under the ownership of Tony Xia,” Maguire recalls. “In both cases, new owners came in and subsequently have – in the case of Liverpool – revitalised the club. Liverpool is now a giant of English football.”

Thankfully for Liverpool fans, they were bought out by Fenway Sports Group, led by John Henry, in November 2010. Over the course of the following decade, they helped the club win their first ever Premier League trophy, in 2020. For Villa, Egyptian billionaire Nassef Sawiris and American billionaire Wes Edens acquired a controlling stake in the club, and oversaw the club’s return to the Premier League in 2019.

“New ownership is not necessarily a good thing or a bad thing, it’s a thing. And it comes down to the quality of the ownership and to a certain extent to the depth of the money in their pockets.”

Exposing holes in ownership models

Maguire refers to the Tracey Crouch Fan-Led Review of Football Governance, which exposed significant flaws in ownership models up and down the footballing pyramid–as demonstrated by the plight of several EFL clubs who have paid the price for throwing money at a dream that was never realised.

“One of the things that was very telling was Tracey Crouch said there are far too many clubs that are one ownership decision away from catastrophe,” he explains.

“One of the things that all owners should be encouraged to do is to try to have a sustainable football club, and that means living within your means.

At Chelsea, that means that “in the short term, perhaps there could be greater attention to cost control, perhaps they could look at some of their non-player assets which are potentially surplus to requirements which could generate cash to give them.”

“If you’ve got cash in the bank, that buys you time.”

“I’m sure that the board of the club will be looking at all scenarios with view to Chelsea continuing to be a successful club,” Maguire concludes. And with the clock ticking and a very steep asking price, that could involve a more complex plan than simply swapping one billionaire for another.