Chelsea owner targets new £1.7bn takeover amid Stamford Bridge 'spending cuts'

Chelsea’s ownership is a patchwork of billionaire private investors, sovereign wealth funds and institutional trusts, and fans may never know just how deep the capital structure goes.

The men at the top of the pyramid are Todd Boehly and Behdad Eghbali, the latter of whom represents Clearlake Capital, a private equity firm with hundreds if not thousands of limited partners.

Day to day, Eghbali is believed to be the most involved member of the BlueCo consortium. Once Boehly steps down as chairman in 2027, it will be a Clearlake figure who steps in.

Since the takeover in May 2022, BlueCo have pledged nearly £5bn in funds and are underwriting operating losses in excess of £200m per season at Chelsea.

BlueCo have lost over £1bn since Chelsea takeover

Is this sustainable? What's Clearlake's masterplan to claw back these losses?

Eventually, the consortium will want a return on that investment.

How exactly they plan to make that happen isn’t clear, but Chelsea’s eye-popping transfer and wage spending, relentless squad turnover, left-field approach to commercial revenue and, when the owners finally agree on their chosen path, some kind of stadium development are all part of the masterplan.

For all the talk of how much BlueCo have spent, they aren’t sanctioning any investment which is beyond their means. And the latest sports business news from across the Atlantic further illustrates just how deep their pockets are.

Chelsea director targets £1.7bn MLB takeover

The three men at the top of Clearlake Capital are Eghbali, James Pade and Jose Feliciano.

Late last week, industry publication Sportico reported that Feliciano – who sits on the Chelsea board – is among the investors interested in taking over Major League Baseball’s San Diego Padres.

The Padres, who Sportico value at £1.7bn, are also a target for Everton owner Dan Friedkin.

If Feliciano does buy the MLB franchise, it will be in a private capacity rather than through Clearlake. It would also extend the number of sports teams in Chelsea’s orbit via the owners.

As well Chelsea and Strasbourg, BlueCo consortium members Boehly and Mark Walter own the NBA’s Los Angeles Lakers, baseball’s Los Angeles Dodgers.

Boehly also owns a significant minority stake in The Hundred cricket franchise Trent Rockets, while his Eldridge Industries investment firm owns 10 per cent of Blue Owl Capital, which in turn is a minority investor in Aston Villa Women.

Another private equity firm, Ares Management, don’t have an equity stake in Chelsea but are involved in the capital structure via a £365m debt deal.

Ares are looking to take control of John Textor’s Eagle Football group, which until recently was the largest shareholder in Crystal Palace. Eagle still own OL Lyon in France and Botafogo in Brazil and Molenbeek in Belgium.

The multi-club model is HUGELY controversial

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So what are the benefits to having such a deep ownership structure? It’s all about access to capital, says University of Liverpool football finance lecturer Kieran Maguire.

“They can absorb losses more easily than many owners,” he said in exclusive conversation with The Chelsea Chronicle.

“It’s a fund with a broad portfolio of cash and investment assets, of which Chelsea are ultimately a very, very minor player. Therefore, it is not a big challenge to fund the losses.“

Maguire also suggests that, while Chelsea’s owners are free to invest their considerable reserves in infrastructure, the club’s ongoing settlement agreement with UEFA will limit their spending in the recruitment and retention department over the next few years.

“There might be a compliance challenge, but by my calculations they have complied with the terms of the UEFA settlement this season. If those rules hadn’t applied, they could have spent much more.

“As a group, BlueCo have the facilities to be able to underwrite Chelsea’s operating losses for a long time The UEFA settlement, however, might mean they have to cut spending in the next few years anyway.”

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