Chelsea’s shirt sponsor Three has suspended its deal with the club after owner Roman Abramovich was sanctioned by the British government.
The telecoms company began sponsoring Chelsea at the start of last season in a deal worth around £40m per year, and its logo is prominently displayed on the club’s kits, around Stamford Bridge and at the training facility in Cobham.
Three had said earlier on Thursday that it was considering its relationship with the club, before confirming it would “temporarily suspend” sponsorship and requesting its branding be removed.
The news broke only two and a half hours before Chelsea were due to play Norwich City in the Premier League.
A statement by Three read: “In light of the government’s recently announced sanctions, we have requested Chelsea Football Club temporarily suspend our sponsorship of the club, including the removal of our brand from shirts and around the stadium until further notice.
“We recognise that this decision will impact the many Chelsea fans who follow their team passionately. However, we feel that given the circumstances, and the Government sanction that is in place, it is the right thing to do.
“As a mobile network, the best way we can support the people of Ukraine is to ensure refugees arriving in the UK from the conflict and customers currently in Ukraine can stay connected to the people who matter to them. Therefore, we are offering connectivity packages to all Ukrainians in the Uk, and those in Ukraine”.
Chelsea recoup more than £150m per year from their commercial partners including Yokohama Tyres, Sure, Hublot and trivago, but other brands are now likely to follow Three’s lead.
Another Chelsea sponsor, the car manufacturer Hyundai, is already reviewing its relationship with the club, thought to be worth around £10m per year. “Hyundai has become one of the strongest partners in football over the years & the company supports the sport to be a force for good,” it said. “We are currently assessing the situation with Chelsea FC.”
Chelsea now face an uncertain future. Abramovich’s assets have been frozen by the government due to his links with the Russian president Vladimir Putin, and he is no longer allowed to make money from the club. The irony is that Chelsea are steeped in debt of more than £1bn, mostly owed to Abramovich.
The oligarch can apply for a licence from the Treasury in order to sell the club despite the sanctions, and there are several parties interested in buying. But that is unlikely to be a quick process, and in the meantime Chelsea have a vast wage bill to honour.
The terms of Chelsea’s new operating licence, which currently lasts until 31 May, mean the club’s financial activity is extremely limited. No new tickets can be sold, no players can be traded and no new contracts can be offered to key players like Antonio Rudiger, whose deal runs out this summer.
With minimal matchday revenues, merchandise sales blocked and sponsors withdrawing, the club now faces a race against time to find new ownership before their financial plight becomes impossible to salvage.
