New Chelsea chief gets £300m mission from Todd Boehly and Behdad Eghbali
The Chelsea boardroom is divided, with factions led by Todd Boehly and Behdad Eghbali offering competing visions for the future. However, both men recognise the significant of boosting revenue.
Chelsea’s mind-melting spending in recent years, not just on transfer fees but wages too, means that the club are straining to get within the Premier League and UEFA’s PSR thresholds.
With two hotels at Stamford Bridge plus the women’s team sold to Chelsea-owned companies, the club have offset their losses in the current assessment window by around £250m.
That should ensure compliance with the Premier League’s spending rules for the current assessment window. Richard Masters and co gave the green light to the intra-company deals earlier this year.
UEFA, however, do not recognise those sales for PSR purposes, meaning the margins are much tighter for Chelsea as far as European football’s governing body’s system is concerned.
Commercial income – that’s revenue from sponsorship, merchandise, and events – will be pivotal if Chelsea are to escape the clutches of PSR’s enforcers.
But their despite bombastic rhetoric about revolutionising the club commercially when they arrived in SW6, Boehly and Eghbali’s regime has missed several open goals so far.
The most conspicuous is their lack of a front-of-shirt partner, which has not only cost the club millions in lost revenue but also upset Nike, who believe it has caused a drop-off in Chelsea shirt sales.
However, the latest news from the commercial department could potentially breathe new life into the Blues’ hunt for a new primary sponsor.
Todd Kline arrives at Chelsea
In February, a flurry of outlets reported that Todd Kline was set to join Chelsea after ditching Tottenham, where he was the North London club’s chief commercial officer.
The manner of Kline’s Spurs exit, which the club acknowledged with a one-sentence statement without any well wishes, suggested that he was leaving under a cloud.
Kline was placed on gardening leave at Spurs and his appointment has only been announced by Chelsea today, eight months after the news broke that he was set to join the club.
Spurs meanwhile are yet to name Kline’s replacement, although an unnamed chief commercial officer did attend a sports business conference in London recently on their behalf.
As the top authority at Chelsea on all things commercial, Kline will be responsible for leveraging the club’s brand to extract maximum value from sponsorship.
He will also oversee optimising Stamford Bridge – or perhaps even a new Chelsea stadium entirely – for commercial purposes.
Chelsea’s annual commercial income was over £200m at the last count, which was the fifth highest in the Premier League behind Liverpool, Spurs and the two Manchester clubs.
New chief commercial officer must secure new Chelsea shirt sponsor
At Spurs, Todd Kline’s main responsibility – which he himself confirmed – was to secure a naming rights deal for the Tottenham Hotspur Stadium.
Spurs were at one point looking for a £25m-a-year deal, although the value of their rights has likely dwindled since the arena opened in 2019.
Kline did not manage to secure a deal. Spurs chairman and co-owner Daniel Levy says that naming rights are not an immediate priority for the club, but it is understood that they are still in the market.
Chelsea will have to hope that former Miami Dolphins and Washington Commanders CCO Kline has more luck in West London.
His mission from the feuding Boehly and Eghbali is clear: secure a front-of-shirt sponsor.
Chelsea were targeting £60m from a shirt sponsor, but the fact that several months of the season has now elapsed reportedly means they would now accept £25m for the campaign.
But even if Kline finds a temporary solution for the remainder of 2024-25, his main priority will be to find a long-term partner who, at Chelsea’s target price, can commit £300m over the next five years.
Why do Chelsea not have a shirt sponsor yet?
Some analysts have suggested that Chelsea’s asking price for front-of-shirt sponsorship is simply too high.
Their shirt rights are the most valuable item in their sponsorship inventory, but benchmarking against other Premier League clubs suggests £60m is ambitious, especially without Champions League exposure.
Chelsea rivals’ front-of-shirt deals
- Tottenham – AIA, £40m per season
- Arsenal – Emirates, £50m per season (includes stadium naming rights)
- Liverpool – Standard Chartered, £50m per season
- Man City – Etihad, £67.5m per season (includes stadium naming rights)
- Man United – Snapdragon, £60m per season
Another school of thought is that the ongoing fallout from Man City’s challenge to the Premier League’s associated party transaction (APT) rules may have stalled Chelsea’s hunt for a shirt deal.
The boardroom battle between Boehly and Eghbali meanwhile will likely have had some operation impact.
Infighting, however, is no excuse for failing to secure a deal which will likely be worth around 10 per cent of Chelsea’s annual revenue at a time when PSR is a constant source of anxiety.
What is the latest in Todd Boehly vs. Behdad Eghbali?
In the early days of the post-Roman Abramovich era, Boehly’s influence at Chelsea was disproportionate to the relatively modest 13 per cent equity stake he owns.
He anointed himself as the club’s interim sporting director and was the public face of Chelsea at Premier League shareholder meetings.
However, Eghbali – whose Clearlake Capital private equity company owns more than 60 per cent of Chelsea – now appears to be the main man.
Boehly also has the backing of Mark Walter and Hansjörg Wyss, who also own circa 13 per cent stakes. But that faction is still less powerful in equity and voting rights terms than Clearlake.
Recently, reports have suggested that the mechanics of Boehly buying Eghbali out or vice versa may simply be too complicated to find a speedy resolution.
In any case, it is unlikely that either party would get a return on their initial investment in line with their capital appreciation plan at Chelsea, which could be another stubborn obstacle for a takeover.
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