By Tim Parsons-
Chelsea owner Roman Abramovich has struck a deal with the UK government that will allow the smooth sale of the club , following reports it had hit a snag earlier this week, according to sources close to the Russian.
PA news agency reports that a resolution has been reached over how the £1.5bn debt owed to Abramovich will be handled. The arrangement prevents a takeover by Todd Boehly and his consortium from going through.
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Eldridge Industries founder and Los Angeles Dodgers co-owner Boehly will become the controlling owner once the takeover is concluded after signing an agreement to purchase the club on May 7. The American businessman will hold the most influence in the consortium, with Clearlake Capital co-founder Behdad Eghbali expected to work closely alongside him and playing an active role in making financial decisions.
Despite the Oligarch insisting he did not want the debt repaid to him, the government was sceptical that he may U-turn on this stance at a later date and demand the money. However, that now appears to have been resolved leaving Boehly’s consortium clear to finalise their takeover by the end of the month.
Abramovich needs government approval to proceed with the £4.25bn sale of Chelsea to Todd Boehly, co-owner of the Los Angeles Lakers basketball team, and US buyout group Clearlake Capital.
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Earlier in May, Thomas Tuchel admitted that the off-field drama had affected his side’s performances. Chelsea have been knocked out of three tournaments and put their place in the top-four at risk over the past few months and the manager says it was inevitable that his side would eventually be distracted.
Boehly and Clearlake are together acquiring Chelsea for £2.5bn, with a further £1.75bn committed to investing in the club’s stadium, academy and playing squads.
The £2.5bn acquisition price is due to be paid into a frozen UK bank account from which any transfer would require government approval. Officials are concerned that unless there is a legal commitment to write off the loan, Camberley could seek repayment from the account in the future.
Abramovich and his allies have denied he wants the debt to be repaid. A spokesperson for Abramovich did not respond to a request for further comment.
A fortnight ago, the UK government placed sanctions on Evraz, the multinational steelmaker part-owned by the billionaire Roman Abramovich that was formerly counted among Britain’s biggest companies.
The Foreign Office said on Thursday that Evraz “operates in sectors of strategic significance to the government of Russia” and the action would “further chip away at Putin’s financial reserves and siege economy, and support Ukraine’s continued resistance.
The UK and allies including the US and EU have used sanctions on Russian companies and businessmen as one of the main tools to respond to the invasion of Ukraine.
The Evraz measure was the first time a former FTSE 100 member has been subject to sanctions. It completes the fall from grace of a company that was valued at more than £5bn as recently as January.
Its membership of the index meant that shares in the company were held by a wide variety of investors managing money for pensions, including BlackRock, Schroders Investment Management, Vanguard and Legal & General.
Evraz shares were suspended from trading on the London Stock Exchange in March after the UK government highlighted its alleged strategic significance to Russia when imposing sanctions on Abramovich, who owns a 29% stake in the company. Its board also resigned after the sanctions against Abramovich.
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