The finale of the Champions League is moved from Saint-Petersburg to Paris and football club Chelsea is shut down: a few examples of consequences of the war in Ukraine. Thomas Peeters, Sports Economist at Erasmus School of Economics, provides more insight into the situation surrounding Chelsea.
Because the current owner of Chelsea, Roman Abramovich, has ties with Putin, fears arose that Chelsea could suffer negative consequences. For this reason, Abramovich announced that he wants to sell the club: people have until mid-March to make a bid. Peeters was surprised when he heard this: 'If you had told me a fortnight ago that Roman Abramovich would sell Chelsea, I would not have believed you. It is a huge surprise in that respect, although his move may be a little less surprising after the events that are now taking place in such quick succession'.
Financial situation of the club
Chelsea's finances look rosy, Peeters also argues: 'From a turnover of 150 to 200 million euro, Chelsea has gone to a turnover of over half a billion euro on a yearly basis. So the club is certainly worth more than when it was bought'. However, the hard numbers are not the only determinant of Chelsea's eventual selling price. On the one hand, the relatively short term at which Abramovich wants to sell the club can have a negative effect on the price. On the other hand, the football sector is a sector that is experiencing strong growth: the sector is increasing by 15 to 20 percent annually and the Premier League also has a special position as a very lucrative division where the sporting level is very high. Peeters: 'Then there are always more bids. The other reason is that people do not necessarily buy football clubs because they want to earn something from them. A yacht doesn't pay off either'.
Loan
One figure in particular stands out in Chelsea's books: Abramovich has lent EUR 1.8 billion to Chelsea and it still has to be paid back. However, according to the Russian, this is not necessary. According to Peeters it is useful to know how Abramovich wants to deal with this matter: 'The question is whether he does not claim it or actually waives it. It is also possible that the loan will remain on the balance sheet without a repayment plan. If I were him, I would not write them off, because at the moment he does not know what sanctions he will face'. It remains to be seen, therefore, whether this loan will not eventually be claimed, which poses a financial risk to potential buyers.