Todd Boehly and Clearlake set up takeover talks as Chelsea's £1.2bn debt revealed
In the latest behind-the-scenes drama between Todd Boehly and Clearlake Capital at Chelsea, a troubling financial detail has emerged.
Boehly and Clearlake paid £2.5bn to take over Chelsea in May 2022, with another £1.75bn committed for future spending on infrastructure and the women’s team.
Boehly, a private equity billionaire with a background in sports and media, is often cited as the chief decision maker at Stamford Bridge but is becoming increasingly obvious that this is not the case.
In recent days, it has emerged that a rift has emerged between Boehly and Clearlake’s main decision maker, Behdad Eghbali.
After spending billions on a scattergun recruitment strategy with a negligible return, Eghbali has reportedly stepped into a more prominent role at Chelsea.
He, alongside co-sporting directors Paul Winstanley and Laurence Stewart, drove Chelsea’s decision to sack Maurico Pochettino despite an upturn in form at the tail end of 2023-24.
And with the future of the power dynamic at the club uncertain, an issue relating to the debt situation the club currently finds itself in has now surfaced.
Chelsea in £1.2bn debt
The billions that Chelsea owed Roman Abramovich were wiped as part of the takeover two years ago, but the new regime appears to have piled the debt back on.
As relayed by finance expert Greg Cordell, citing figures from Chelsea’s holding company’s official accounts, the club’s debt is now at least £1.2bn.
In fact those figures were taken from the club’s accounts as of June 2023 and Cordell projects that the true figure could in fact be significantly higher.
Cordell explains that this could see the Boehly group – which consists of Mark Walter and Hansjorg Wyss – be liable to absorb first losses.
This could be significant in the context of the future ownership of the club, given that it is being widely reported that the Boehly group and the Clearlake faction want to buy each other out.
Indeed, The Times‘ Matt Lawton has written that there is expected to be “talks between all the leading shareholders in search of a resolution over the coming days and weeks.”
Given that the situation between the warring factions in the boardroom appears untenable, this will likely amount to negotiations over an internal takeover.
The future of the Chelsea ownership regime
Whatever the future holds for Chelsea, a resolution is unlikely to be reached any time soon.
Both sides of the rift are known for their belligerent approach to negotiations and are unlikely to back down unless a deal absolutely suits their economic interests.
The information we have suggests that the Boehly group, as the more junior member of the coalition, is likely to have less leverage in the talks.
However, there also appears to be no mechanism in place that could trigger an automatic buyout from Clearlake’s side.
Until the dispute has reached its ultimate crescendo, Chelsea will be in limbo.
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