Premier League to approve Todd Boehly’s Chelsea takeover
The majority of concerns raised by the government, as well as current owner Roman Abramovich, have also now been met.
The Premier League is set to approve the proposed £4.5 billion takeover of Chelsea by a consortium led by the LA Dodgers co-owner Todd Boehly, with all parties increasingly confident that the UK government will also issue a licence for the sale.
The Boehly group, which is backed principally by California-based private equity firm Clearlake Capital, was granted preferred bidder status last week, with Boehly and other key members of the group spending much of this week in meetings at Stamford Bridge finalising the deal. Their period of exclusivity ended on Friday.
In the background, it is understood that the Premier League has been conducting due diligence on the prospective owners and is close to signing off on the deal.
Sources close to the process believe that the majority of concerns raised by the government, as well as current owner Roman Abramovich, have also now been met.
Issues about a £1.6 billion loan owed to Abramovich will likely be resolved by the money being held in an account controlled by the government. Insiders suggest there could be tax implications that further complicate the matter, but the Russian oligarch who has owned Chelsea since 2003 has insisted again this week that all net proceeds of the sale will go the victims of the war in Ukraine. He said the “funds will be frozen and subject to a legal procedure governed by authorities.”
He added that “these funds are still earmarked for the Foundation” — referring to a charity he wants set up in response to Russia’s invasion.
The view now held by Chelsea, their US bankers and the Boehly group is that it has been a successful week in terms of answering many of the government’s concerns around the sale when Abramovich remains the subject of sanctions because of his links to Vladimir Putin.
It emerged on Friday that questions regarding the intentions of private equity investors have also been answered. Late in the process Chelsea demanded that the rival bid groups commit to owning the club for at least ten years by agreeing to a clause that prevents them from selling a majority stake in the club before 2032. But other clauses, described by sources as “anti-Glazer clauses” in reference to the debt-laden ownership model at Manchester United, have also been inserted into the purchase agreement.
These will stop the new owners from paying dividends or receiving management fees for the same ten-year period. There will also be a limit on the level of debt that the club can take on.
On Friday a deal between Chelsea and the Boehly group was close to being agreed, with a statement confirming they would now be presented to the government and the Premier League for approval said to be imminent.
