Chelsea see drop in enterprise value

The Premier League’s status as the richest domestic league in global football has been underlined by a new report into European club valuations, with nine of the top 20 coming from England.

Now in its 10th year, the Football Clubs’ Valuation report is published by the Budapest-based Football Benchmark Group and it ranks the top 32 clubs in Europe by enterprise value, which is the total value of the club’s equity plus its net debt.

As always one has to caution that these reports are a product of their chosen methodology and should be seen as indicative rather than definitive.

Having become the first club to achieve an enterprise value of €5billion last year, Real Madrid burst through the €6bn mark this year to top the ranking with a valuation of €6.3bn (£5.2bn; $6.5bn) this year, almost £1bn clear of Manchester City in second place, with Manchester United not far behind their cross-city rivals (which will surprise some).

While Football Benchmark believes that Manchester United’s enterprise value has grown by 4 per cent over the last 12 months from €4.9bn to €5.1bn, that currently converts to £4.3bn, which is lower than the price Sir Jim Ratcliffe bought in at when he paid £1.25bn for 27.7 per cent of the club in early 2024. Given the club’s on-field struggles, the British billionaire may be grateful that his investment has not fallen further.

Barcelona and Bayern Munich round out the top five in this year’s report, with Liverpool and a resurgent Arsenal close behind, followed by Paris Saint-Germain, with Tottenham Hotspur, the biggest climber over the last decade, and Chelsea completing the top 10.

It would seem that Ratcliffe is not the only Premier League investor who will have to be patient to see a return, as Football Benchmark believes Chelsea’s enterprise value has dropped eight per cent year-on-year — the only faller in the top-10 — with the west London club now worth £2.5bn, which is what the Todd Boehly-Clearlake Capital led consortium paid Roman Abramovich for the team in 2022.

Overall, though, the report is another glowing reference for the Premier League’s financial success, with West Ham United, Aston Villa (up a remarkable 42 per cent year-on-year) and Everton all making the top 20.

However, increased revenues are not the same as increased profits, with most of the clubs in the report posting large losses last season, although those deficits have reduced every season since 2022, when COVID-19 plunged European football into crisis. The aggregate loss for the 32 most valuable clubs in Europe last season was just over £430m, down from the catastrophic figure for 2022 of almost £2.3bn.