Chelsea have been warned that their future is in jeopardy after the government ruled out a delay in the sale amid fears that Roman Abramovich has not kept his promise to write off a £ 1.6bn debt.
Ministers believe that the time limit for licensing expires on May 31, and it is understood that they categorically reject the prospect of more negotiations, allowing Abramovich to get his money back.
The sanctioned Russian billionaire promised in a statement when he put the club up for sale in early March that he would write off the huge sums the club still owes him.
However, sources close to the government process say Chelsea are now raising the prospect of a restructuring on terms of sale, which seems to allow Abramovich to be paid.
Several insiders in Whitehall told the Telegraph Sport that the ministers’ position remains that Chelsea will not receive approval for the takeover if he receives a penny. However, according to an amended proposal discussed late last week, Chelsea’s parent company Fordstam Ltd will repay loans to offshore Camberley International Investments, which is believed to be linked to Abramovich.
Abramovich’s aides did not confirm whether he had changed his mind, but it is alleged that he had reservations about a potential freeze on the finance ministry’s loan.
The confusion at 11 a.m. heightened the government’s sense of concern that negotiators would soon run out of time to complete the complex process. As auditors also need to verify and implement the process of paying billions to the foundation, Whitehall’s figures have raised the prospect of an “existential threat” to the club.
Downing Street imposed sanctions on Abramovich on March 10, claiming he had proven the business tycoon’s ties to Russian President Vladimir Putin. Abramovich was then stripped of his Premier League license, so he will not be considered a valid owner when England’s highest level meets on June 8 to make up the 2022-23 season. He said Chelsea’s license to continue working under a government license would have expired eight days earlier.
The feeling in the government is that Abramovich’s people have been trying to impose the hand of the ministers by raising the prospect of changing their minds about the loan at this late stage. However, many figures in Whitehall say the loan agreement remains a red line and there can be no room for further negotiations.
Abramovich said in early March, when he put Chelsea up for sale, that “I will not ask for any loans to repay.” Chelsea’s parent company had just over £ 17 million in cash at the time of the last set of accounts until the end of last season, but the loans Abramovich took out after buying the club in 2003 now stand at £ 1.6 billion. Last season alone, Abramovich injected around £ 150 million and withdrew around £ 130 million to end the year, giving the club a total of £ 19.9 million.
In early March, however, Abramovich promised to write everything off, saying all net proceeds from the sale would be donated to a charity “for the benefit of all victims of the war in Ukraine.” “I have always made decisions with the best interest of the club,” said Abramovich. “In the current situation, I decided to sell the club because I believe it is in the best interests of the club, fans, employees, as well as sponsors and partners of the club. The sale of the club will not be quick, but a proper procedure will follow. I will not ask for any repayment loans. It was never about business or money for me, but about pure passion for the game and the club. “
What does this mean and what follows for Chelsea?
Did Abramovich really change his mind about his promise to write off his £ 1.6 billion loan to Chelsea?
It has been a long two months since Abramovich – then still clinging to the vain hope that he could still avoid sanctions – announced the club for sale and promised to write off huge loans. All net proceeds from the sale, he said at the time, would be donated to a charity that would “benefit all victims of the war in Ukraine”. “I have always made decisions with the best interest of the club,” Abramovich said.
“In the current situation, I decided to sell the club because I believe it is in the best interests of the club, fans, employees, as well as sponsors and partners of the club. The sale of the club will not be quick, but a proper procedure will follow. I will not ask for any repayment loans. It was never about business or money for me, but about pure passion for the game and the club. “
However, much has changed since then, and his charitable mood can only be tested, as both the UK and the EU have insisted on restrictions until the Premier League rips off his right to own Chelsea. Any hope that sanctions could be eased soon was shattered in the past two weeks when authorities tightened the screws on a close aide to Chelsea’s director Eugene Tenenbaum and froze hundreds of millions of pounds in assets in Jersey, France and beyond.
It remains to be seen whether Abramovich has really made a U-turn on his loan. Telegraph Sports said sources close to the government process said that according to an amended proposal submitted by Chelsea late last week, the parent company Fordstam Ltd would repay loans to offshore Camberley International Investments. However, as Chelsea have not yet commented on Abramovich’s intentions during closed-door talks, the full picture is incomplete.
What is the position of the government?
There are two main reasons why the government cannot break through and now allow Abramovich to withdraw money from the deal. First, ministers support the view that any change in Chelsea’s operating license as a frozen asset will only be granted if the club can prove that the sanctioned billionaire does not win.
Second, there is simply no time to have fun with such late requests. Before 11 a.m., a visible change in tactics by Abramovich, Culture Minister Nadine Doris warned that Chelsea was already busy. “There is a very short window left for this sale to take place,” Doris said. Chelsea are working under a special license from the United Kingdom government, which expires on May 31. Asked how soon the club should be sold, Doris said:[within] weeks ”.
Why did this happen now?
Given that all countries want to avoid a situation in which Chelsea will stop, the negotiators for Abramovich may perceive this as the most likely moment in which the government can blink.
The talks between the club and the ministers are in the most detailed, delicate and critical stage, as exclusive talks have already begun with a preferred candidate in Todd Boelli.
What will happen if the deal is postponed until May 31?
This is the potential disaster scenario for Chelsea. The license to continue operating with exceptions to Abramovich’s general sanctions expires just eight days before the Premier League meeting to agree on signing clubs for the 2022-2023 season. Whitehall sources say there is a real “existential threat” to the club if the deal fails by May 31.
Add Comment