Chelsea Football Club have been hit with a major blow as the British government have decided to put a sanction on the club’s current owner Roman Abramovich.
Originally, a sanction means the Blues would not be able to play anymore but the government have laid out some special conditions under which the London side will be able to continue their season.
Abramovich had recently put Chelsea up for sale and despite the sanction, the government have announced that the club can still be sold but the proceeds of the sale cannot go to the current owner.
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Are Chelsea about to go into administration?
The Premier League along with the Treasury and the DCMS are making preparations for Chelsea’s sale but according to football finance expert Ed Thompson, the businessman’s loan to the Blues could become a major hindrance, resulting in the London side going into a possible administration.
“The Chelsea FC Holding Co owes Abramovich c£1.5bn. That’s now frozen and I don’t believe he can’t write it off at this time even if he wants to,” the FFP analyst wrote on Twitter.
“So no-one will buy the club with that hanging over it. Club loss-making, so for what it’s worth I expect club to go into Administration.”
The #ChelseaFC Holding Co owes RA c£1.5bn. That's now frozen and I don't believe he can't write it off at this time even if he wants to. So no-one will buy the club with that hanging over it. Club loss-mqking, so FWIW, I expect club to go into Administration.
— Ed Thompson (@edthompsn) March 10, 2022
Thompson also went on to add that Chelsea could also be facing a potential points deduction if they go into administration.
He said: “Worth remembering that when Saints Holding Co went onto Administration, the club had a points deduction. Barring some bizarre arrangement between Abramovich and Govt, hard to see that frozen £1.5bn debt to RA in Fordstam ltd ending well.”
Worth remembering that when Saints Holding Co went onto Administration, the club had a points deduction. Barring some bizarre arrangement between Abramovich and Govt, hard to see that frozen £1.5bn debt to RA in Fordstam ltd ending well
— Ed Thompson (@edthompsn) March 10, 2022
Ed is not the only person who is concerned with Chelsea’s current position as Dr Rob Wilson, a football finance expert from Sheffield Hallam University has claimed that the sanctions have actually dented the club’s value and this could push away a lot of the interested parties.
“The sanctions push (the value of the club) down. It is an asset that needs to be transferred at some point, so if you need to sell something, the closer you get to the deadline of needing to sell, the cheaper it probably gets,” he told the PA news agency, as quoted.
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“I would describe Chelsea as a distressed asset, and the association that they’ve got with the owner is what’s distressing them.”
He has also admitted that Roman Abramovich is a very hands-on owner and unless someone of a similar vein takes over, Chelsea will find it really hard to flourish.
“The bottom line is that the football club can’t survive without (Abramovich) and his ownership because of the way he puts money into them,” Dr Wilson added.
“Unless you can find somebody else like him or with pockets as deep as his to continue the ongoing running costs of the club.”
The Chelsea management is fearing that they will run out of funds really soon so they will definitely hold talks with the government to see if they can get some of the restrictions lifted.
