Chelsea Ownership Saga Continues: Todd Boehly and Mark Walter Mull Selling Shares to Clearlake Capital

A high-stakes power struggle at Chelsea Football Club is heating up as Todd Boehly and Mark Walter, the club’s co-owners, consider selling their combined 13% stake to Clearlake Capital, the majority owner of the team. The proposed deal would grant Clearlake effective control of the club, with a staggering 86% shareholding.

Source: i.guim.co.uk

The unusual ownership arrangement, agreed upon when Clearlake purchased Chelsea from Roman Abramovich in 2022, has led to a stalemate between the two ownership groups. The stalemate began almost two years ago, with reports emerging of a disagreement over strategy, particularly regarding plans for a new stadium. Discussions over a potential deal have resumed in recent weeks, with Walter seeking to raise funds to pay off insurers following a US federal investigation into alleged tax fraud.

Walter is being investigated by the US Department of Justice over $21 billion in loans that were allegedly not disclosed to state insurance regulators. This has led to the sudden sale of assets to pay down some of the loans. Notably, Walter recently sold the Los Angeles Lakers to Josh Kushner and Bob Iger for $12.5 billion, just a year after purchasing the NBA franchise for $10 billion. This move has sparked speculation that Walter may also seek to exit Chelsea.

Boehly and Walter are close friends and longstanding business partners, having previously invested together in the LA Dodgers Major League Baseball team and the LA Sparks WNBA franchise. Together, they control 38% of Chelsea through Blueco 22 Holdings, although it is unclear whether Swiss billionaire Hansjörg Wyss is also willing to sell. Under the terms of their £2.5 billion purchase from Abramovich, none of Chelsea’s shareholders can sell to a third party without the consent of their partners.

An external sale is therefore unlikely, putting Clearlake in a strong position to gain complete control of the club. Boehly and Walter will, however, demand a significant premium on the £325 million they paid for their shares four years ago. A sale by Boehly and Walter would leave Clearlake with more than 86% of Chelsea’s shares and effective control of the club, including the bid to build a new stadium at Stamford Bridge.

Boehly has been the public face of Chelsea since the 2022 takeover and acted as interim sporting director during the summer transfer window in 2022, leading the purchase of players such as Raheem Sterling and Marc Cucurella. However, he stepped back from his hands-on role after 12 months, with Behdad Eghbali taking more operational control on behalf of Clearlake. Boehly was due to stand down as chair at the end of the season, with a Clearlake representative to replace him for the next five years under the terms of the ownership agreement.

The timing of an exit at this stage would be ironic, as Chelsea have returned to Boehly’s original strategy this summer by signing experienced players such as Danny Welbeck and Jordan Henderson. Representatives of Clearlake, Boehly, and Chelsea were approached for comment.