Newspaper article The Evening Standard (London, England)

Euro Dream Weighing Heavily on Abramovich

Newspaper article The Evening Standard (London, England)

Euro Dream Weighing Heavily on Abramovich

Article excerpt

Byline: James Olley Chief Football Correspondent

THE desperation which greeted Chelsea's Champions League defeat to Manchester United deepened today after the club's latest financial figures revealed an increasing reliance on owner Roman Abramovich's wealth as UEFA's crackdown on monetary largesse hoves into view.

Chelsea's holding company, Fordstam Limited, revealed the club owe just under [pounds sterling]739.5m in loans underwritten by Abramovich since he bought the club from Ken Bates in 2003.

It comes after the club announced in January losses of [pounds sterling]71million for the year ending 30 June 2010 despite winning the Premier League and FA Cup in that time and spending just [pounds sterling]1m net on transfers.

None of the figures revealed today include the [pounds sterling]75m spent on Fernando Torres and David Luiz in January -- a lavish expenditure that the results prove highly likely to be the final throw of the dice in Abramovich's willingness to bankroll Chelsea's pursuit of Champions League glory. UEFA's Financial Fair Play regulations are set to be introduced from the beginning of the 2012-13 season and require clubs to break even over a three-year period.

Essentially, a club cannot spend more money than they generate so Chelsea's debt of [pounds sterling]739.5m, which is covered by Abramovich (right), is irrele UEFA's new regulations. The ke are turnover, wage bill and exp on transfer fees.

Chelsea's wage bill represen cent of turnover -- much high the 70 per cent UEFA will allo does not compare well to other clubs. Real Madrid (46 per ce celona (68), Manchester Uni and Arsenal (around 60) all fa the guidelines despite huge w but these clubs generate muc revenues.

UEFA will allow owners to m up the shortfall between turn and expenditure to the tune [pounds sterling]38m for the first two years w that figure falling to [pounds sterling]26m in 20 with further reductions there ter. It is possible for clubs to stri sponsorship or naming righ deals with their owners to help close the gap but UEFA will test any such agreements to ensure the price agreed is in line with market valuations.

The scramble to finish in the top four has graver financia implications than perhaps ev before. With clubs having to raise their turnover figure to help ring wages as a ge of that figure ntrol, the income icipating in the League is vital. A expect to earn around [pounds sterling]12m from qualifying for the group stage with a further [pounds sterling]678,000 earned for each victory and [pounds sterling]339,000 for a draw.

Last year's winners, Inter Milan, made [pounds sterling]41.5m in total, while the maximum a club can earn from success in the Europa League is just [pounds sterling]5.4m -- and that figure can only be reached if they win all their group games. …

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