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Two US billionaire-led bids lead £3bn race to buy Chelsea FC

Two bids backed by US billionaires have become the frontrunners to win the £3bn race to purchase Chelsea Football Club, which is rushing to replace its Russian oligarch owner Roman Abramovich, who has been hit with sanctions.

The preferred bids are from an investor group led by Todd Boehly, the financier and owner of baseball’s Los Angeles Dodgers, and another led by Josh Harris and David Blitzer, the private equity billionaires who own sport teams including basketball’s Philadelphia 76ers, according to people with knowledge of the matter.

On Thursday, other bidders including Saudi Media Group were informed that they had been eliminated from the process, they said.

The unique circumstances of Chelsea’s sale have garnered strong interest for what is seen as a rare trophy asset in football’s most lucrative domestic division, the Premier League. The auction process for the club based in west London, England, is being managed by US merchant bank Raine Group.

Bids are being assessed based on a complicated set of criteria, including how much of the offer will be delivered to charity and how much funding will be available to invest in Chelsea and its stadium, those with knowledge of the matter said. The record of bidders in managing high-profile assets is also being assessed.

The frontrunners in the contest sought to distinguish their offers not only in terms of price but also by collaborating with members of the British establishment.

Boehly’s group has the backing of Daniel Finkelstein, a Conservative party peer and columnist for The Times newspaper in London, while Harris and Blitzer turned to City grandee Sir Martin Broughton and Sebastian Coe, World Athletics president.

California-based investment firm Clearlake Capital, which has more than $60bn in assets under management, is providing financial backing for Boehly’s bid. The Boehly group is working with Goldman Sachs. 

The bid from Saudi Media Group was not competitive and relied heavily on debt financing, an unattractive prospect for the club, one person with knowledge of the situation said.

Bids from British property developer Nick Candy, who was working on a behalf of an investor consortium, and London-based investment manager Centricus are also not expected to progress.

An offer from the Ricketts family, which owns the Chicago Cubs baseball team, was weakened by renewed scrutiny of leaked correspondence in which the family’s patriarch wrote that Muslims are the “enemy”. The Ricketts bid has financial backing from US hedge fund billionaire Ken Griffin.

The Ricketts family has stressed that “racism and Islamophobia have no place whatsoever in our society” after Chelsea fans criticised Joe Ricketts, founder of brokerage TD Ameritrade, for the comments in the leaked emails.

Roman Abramovich
Chelsea has won every major honour in football under Roman Abramovich © AP

The level of interest in Chelsea underlines the growth of the Premier League, Europe’s top football division by revenue and global reach, in America, where the value of its broadcast rights soared in the latest tender.

Chelsea has won every major honour in football under Abramovich, who bought the club in 2003 and broke Manchester United’s domestic dominance by spending millions on buying star players and paying their multimillion-pound salaries.

The club won last season’s Uefa Champions League, the most prestigious club tournament in Europe, and the Fifa club world cup.

Abramovich is selling the club as a result of Vladimir Putin’s invasion of Ukraine, which has forced the sport industry to confront its ties with Russia and oligarchs accused of being close to the Kremlin.

However, the UK’s decision to place sanctions on Abramovich and freeze his assets has added complexity to the sale, which will require special approval from the UK government.

Ministers are adamant that Abramovich, who has pledged to donate the net proceeds of any sale to charity, must not benefit from the transaction. He has also said that he plans to forgive the £1.5bn debt owed to him by Fordstam, the entity through which he owns Chelsea.

Chelsea’s revenue totalled £434mn in the year ended June 2021, up from £407mn a year earlier, bolstered by winning the Champions League.

Despite sanctions, Chelsea is able to play matches because of a licence granted to the club to prevent wider disruption to the Premier League, one of the UK’s biggest cultural exports.

The government amended Chelsea’s licence on Wednesday to allow Abramovich’s Fordstam entity to inject up to £30mn into the club to “resolve any cash flow or liquidity issues”.

If their bid group is successful, Harris and Blitzer will probably be forced to sell their minority shareholding in Crystal Palace, a rival Premier League club based in south London.

Additional reporting by Antoine Gara

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