Chelsea on the market

Roman Abramovich is putting Chelsea on the market. It is not a great surprise after the cancellation of the stadium rebuilding project and the recent difficulties over his UK work visa.

The asking price is over £2bn which would be a world record for a football club. Manchester City and Arsenal are valued at around £1.8bn to £1.9bn. Only someone who is super rich need apply. Abramovich turned down a £2bn bid earlier this year from Sir Jim Ratcliffe, the chemicals tycoon and Britain's richest man with the Russian holding out for £2.5bn. US private equity firm Silver Lake wanted to buy a minority stake in Chelsea, but were turned away. Liverpool rejected a £2bn bid from an Abu Dhabi Sheikh in January.

Abramovich has hired the same specialist US investment bank, Raine Group, that helped Manchester City sell a 13 per cent stake to Chinese businesses in 2015. They are likely to look for buyers in the US, China and the Middle East.

Premier League clubs remain attractive to overseas investors. Although domestic television revenues have slowed down, those from overseas are still growing and there is considerable potential in new revenue streams from social media. Revenues at Premier League clubs have grown 25 per cent year on year while wage growth is only nine per cent. Manchester United shares reached an all time high of $25.20 on the New York stock market, valuing the club at £3.2bn.

Abramovich bought Chelsea for £60m in 2003 and took on its £90m of debts. He has lent the club a total of £1.1 billion. Under Abramovich the company that owns Chelsea, Fordstram, has been in the red every year bar one when it showed a profit of £14.9m in 2013/14.

Whoever takes on the club will need to be prepared to rebuild Stamford Bridge at a cost of £1 billion. This is essential if Chelsea is to compete effectively with its London rivals.

However, such construction projects are highly complex and disruptive, particularly so given Chelsea's constrained site. They tend to exceed both their money and time budgets. Someone working at White Hart Lane told me yesterday that the stadium would not be ready this year.