The government have opened negotiations with Roman Abramovich’s advisers over the terms of the sale of Chelsea, which Downing Street is eager to push through as quickly as possible.
American bank The Raine Group paused the sale after Abramovich was sanctioned on Thursday, but there are numerous bidders willing to pay over £2billion for the club, if the Russian agrees to terms dictated by the government.
The government regard a quick sale as the best outcome for Chelsea and its fans, but for that to happen Abramovich would have to agree to writing off loans of over £1.5bn without receiving any of the proceeds.
The government are ready to grant a special licence to The Raine Group to complete the sale, although they would retain oversight of the process and are likely to demand that all the money raised be given away to charities linked to Ukraine.
Abramovich’s thinking is difficult to discern as he has altered his tactics numerous times since Russia invaded Ukraine two weeks ago.
His initial plan to hand of the running of the club to the Chelsea Foundation collapsed within 48 hours due to objections raised by the Trustees and the Charity Foundation, while his rare publicly statement in which he expressed willingness to donate ‘net proceeds’ of the sale to victims of the war has been vetoed by the government and the club is no longer his to sell.
Abramovich has always denied being a close associate of Vladimir Putin, and won damages in the High Court case last year after contesting claim that he was instructed to by Chelsea by the Russia president to gain influence in the West, so may view accepting the government’s conditions of sale as an admission of guilt.
His options are limited however, as refusing to accept the government’s terms would condemn Chelsea to financial collapse and damage his legacy at a club he claims to hold dear.
Chelsea are currently prohibited from seeking a sale due to the terms of the special licence they are operating under after Abramovich was sanctioned, but the government have indicated they would be prepared to alter the terms to permit a sale if they receive an application from the club.
It is unclear what timescale they are working to, although the 15 March deadline set by the Raine Group for initial bids last week appears to be no longer relevant.
Whilst Chelsea were not placed in administration after Abramovich’s assets were frozen on Thursday the sales process is likely to resemble that carried out by clubs who have been. Job losses are regarded as inevitable, not least as many Chelsea staff are no longer permitted to carry out their roles, with the club’s merchandising and ticket operations shut down.
Chelsea are continuing to negotiate with the government over securing exemptions from a number of the restrictions place on them on Thursday, particularly with regard to ticket sales and match-day operations and travel costs, but have yet to achieve significant breakthroughs.
A government source told Sportsmail that with the club’s owner sanctioned they are conscious of ensuring it is not ‘business as usual at Chelsea,’ indicating that the players and staff may have to cope with working in a less luxurious environment.
The most pressing short-term issue for Chelsea is persuading the government to raise the £500,000 cap on match-day operating costs. In ordinary circumstances a match-day at Stamford Bridge costs closer to £1m, and without a change to the cap Chelsea may have to close some areas of the ground as they will be unable to pay all the stewards and security staff required to operate safely.
Chelsea are also seeking clarity on whether they can sell tickets to away fans for their next home game against Brentford on 2 April as under the terms of the existing licence any new ticket sales are prohibited, an issue which will also impact on future FA Cup and Champions League matches.
The travel arrangements for next week’s last 16 second leg tie in Lille are not a problem however, as the chartered flight and hotel booking has already been paid for.
The government have indicated a willingness to be flexible, particularly over issues involving the fans, and are looking into various solutions to the ticketing problem, such as giving them away or ensuring that all proceeds from future sales go to charity.