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Chelsea owe £1.17 billion to Abramovich

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What would happen if Roman Abramovich decided to sell Chelsea Football Club?

Chelsea v Leicester City - Premier League Photo by Paul Gilham/Getty Images

Roman Abramovich may have halted Chelsea’s stadium redevelopment plans due to an “unfavourable investment climate” in the UK (i.e. visa/geopolitical standoff), but according to reports, remains “fully committed” to the club. That hasn’t stopped speculation that this could be the beginning of the end of his 15-year ownership. Certainly, if he continues to be barred from working in the UK, it’s not inconceivable that he would simply pack up his proverbial toys and leave.

So what would happen to Chelsea Football Club then?

Short answer: probably nothing too tragic. Abramovich is basically only Chelsea’s third owner (Mears family from 1905 to 1982; Ken Bates to 2003), but we’ve already faced larger financial and sporting crises than anything the current situation could potentially conjure up.

Long answer: there could be (financial) drama.

First off, Abramovich wouldn’t necessarily have to sell. Most of the top clubs have absentee owners as it is, with none of the owners of Manchester United (the Glazers), City (supposedly Sheikh Mansour), Liverpool (Henry & Werner of Fenway Sports Group), or Arsenal (Stan Kroenke is the majority shareholder) frequenting their teams all that often, if at all. Abramovich and Spurs’ Daniel Levy were the two exceptions, and most of Chelsea’s day-to-day activities were taken care of by Marina Granovskaia and the rest of the Chelsea Board already. Roman may not be able to work in the country, but as of right now, the UK still allows foreign ownership of property (and English football allows for foreign owners) and he’d be at most a phone call away at any given time.

If Abramovich were to sell, he’d probably make sure to get proper value for the club. What that value may be is anyone’s guess, but most financial magazines and outlets value Chelsea in the £1.25-1.5b range. Sports teams tend not to sell for these stated values however. Forbes may have valued Manchester City right around $2b last summer, for example, but they sold a 13.79% stake in the club for £265m two years prior to that, which already put their overall value on the open market closer to $3b.

As the Times remind us, Abramovich would also probably want repayment of his £1.17b interest-free loan that Chelsea — or technically speaking Chelsea’s parent company Fordstam as Chelsea FC themselves are “debt free” — owe him. Of course, he in turn owns Fordstam, so in a sense, it’s money he owes himself, but that would not be the case in reality. As per the terms of that loan, Abramovich can actually call it in at any time (not just when selling) with an 18-month notice (i.e. Chelsea would have 18 months to repay it).

More likely however, just like when Abramovich bought the club in 2003, that £1.17b debt would be part of the purchase price paid by whoever comes in. Abramovich cleared about £80m worth of debt in addition to the £140m he spent to buy out Ken Bates and all the minority shareholders. Fifteen years later, whoever would be next would probably have to add at least a zero to both of those numbers.

But regardless of whether an individual, a state, or an ownership group would manage to gather up that much money, chances are that Chelsea’s day-to-day business of footballing success would not take a massive hit, even in the worst case scenario. As much as FFP is a drag, it also protects the already rich clubs by not allowing those below to easily jump up a level or two like Chelsea did in 2003 or City in 2008 — it is still possible, as PSG’s shenanigans prove, but much harder in theory than it was before. The players, the facilities, the coaches and managers would remain world-class or very near it, and would likely carry on the winning tradition established over the past couple decades.

Is Abramovich likely to sell? Outside of this sort of idle speculation, probably not. Or at least not yet.