October 13, 2022
Chelsea takeover complete |  Kaufman & Canoles

As stated in previous articles, the purchase of Chelsea FC required approval not only from the Premier League, but also from the UK government, as Roman Abramovich, the selling owner of Chelsea FC, is subject to sanctions issued by the UK government. against Russian people with ties to the Russian government. However, it has been reported that UK government authorities overseeing the sale process under Russian sanctions have approved the buyout deal by the group led by Americans Todd Boehly and Mark Walters, and Swiss billionaire Hansjoerg Wyss.

The Premier League previously approved the takeover following its review of the proposed new ownership group, but completion of the deal has been delayed by UK government review and approval. There were reports that government reviewers were concerned about where the proceeds from the sale would end up, specifically that the proceeds would end up in an entity indirectly controlled, either directly or indirectly, by Abramovich that allegedly violated Russian sanctions. In the end, government reviewers and those involved in the flow of proceeds from the sale were able to craft a structure that allayed the concerns of government officials and ensured that the proceeds did not end up in an entity with ties to Abramovich.

UK government approval comes just in time for Chelsea FC to meet crucial deadlines. The special operating license the UK government had issued to Chelsea FC under Russian sanctions was due to expire on May 31, 2022. Had the takeover deal not been finalized and approved by the May 31 expiry, so Chelsea FC were unable to sign up for the 2022-23 Premier League or the UEFA Champions League next season. Such a result would have been disastrous for the west London club and would likely have triggered withdrawal rights for potential bidders, meaning Chelsea FC would not have been sold and the club would no longer have any license to operate, the club being forced into administration. . Luckily, UK government approval came just in time.

Although the sale of Chelsea FC was an extraordinary circumstance where the sale was, in essence, forced by the UK government through the sanctions imposed on Roman Abramovich, it is common to see sports franchises subject to forced sale either because of the death of an owner without an estate plan or the respective league forcing an owner to sell for any number of reasons or violations. However, even in “routine” forced sale situations where government review is involved, the final destination of the sale proceeds is usually not the point of contention delaying government approval.

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