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.

Chelsea's holding company, Fordstam Limited, revealed the club owe just under [pounds sterling]739.5million 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]71m 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.

That spending is 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 when a club cannot spend more money than they generate.

The huge sum that Abramovich (below) has loaned the club will not come into the UEFA equation, but the worry remains that the Russian may one day want his money back -- some can do as long as he gives 18 notice.

The key figures that UEFA wi will be the yearly losses, turnov bill and expenditure on transf Chelsea's wage bill now repre per cent of turnover -- much than the 70 per cent UEFA w -- and does not compare well leading clubs; Real Madrid cent), Barcelona (68) and Man United (44).

UEFA will allow owners to m the shortfall between turnove expenditure to the tune of [pounds sterling]38m the first two years with that fig falling to [pounds sterling]26m in 2014 with furt reductions thereafter.

It is possible for clubs to stri sponsorship or naming righ deals with their owners to hel close the gap but UEFA will test any such agreements to ensure the price agreed is in line with market valuations.

The Blues have implemented a variety of cost-cutting measures but such frugality was at odds with the drama deadline day spending that appeared to undermine much f their good work n. rejected the offer a new 60,000-um on the site of Court Exhibition Centre -- 8000 new homes will be developed there instead -- while development of their current Stamford Bridge home is not cost efficient.

All of this means the scramble to finish in the top four has graver financial implications than perhaps ever before. With clubs having to raise their turnover to help bring wages as a percentage of that figure under control, the income from participating in the Champions League is vital. A team can 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. …

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