Chelsea’s American revolution takes shape

When I first heard that the new owners of Chelsea had gone to the markets to borrow funds, I knew it would be a somewhat sensitive subject. After all, Manchester United fans still resent the Glazer family for buying the English Premier League side in a leveraged buyout and loading the debt onto the club. As FT colleague Antoine Gara and I discovered, people close to Chelsea’s £800mn deal were keen to stress that this wasn’t to fund the acquisition and that the football club itself wouldn’t be on the hook for interest payments. We go into more detail in our first item on how American buyers are putting their stamp on the team. 

In our second item, you can read about how Shay Segev, former chief executive of FTSE 100 gambling group Entain, is trying to generate a return for one of the world’s richest men. Do read on — Samuel Agini, sports business reporter

Chelsea’s American revolution takes shape

It has been a busy couple of weeks for Chelsea. England forward Raheem Sterling, the club’s new £47.5mn man, made his debut in a pre-season friendly against Charlotte FC on Wednesday night, while Senegalese defender Kalidou Koulibaly signed from Napoli. With no director of football in place, the two moves were instead orchestrated by Todd Boehly, the club’s new chairman and co-controlling owner alongside Clearlake Capital. Other big name signings are being chased. 

As the new starting 11 takes shape, the club is also making important moves off the pitch. Tom Glick has been brought in as president of business, but will effectively assume the role of chief executive taking care of the day-to-day running of the club. Glick comes with a wealth of experience in sport, having been chief executive of Derby County, and chief commercial officer of City Football Group — the parent of Manchester City. Other roles include president of the Carolina Panthers NFL franchise, chief marketing officer at the Brooklyn Nets basketball team, and a one-year stint as chief executive of City Group’s New York MLS side.

His main focus will be on boosting the club’s commercial operations which some in the game see as underdeveloped compared to rivals. According to Deloitte, Chelsea generated £155mn from commercial activities last year, compared to Liverpool’s £211mn and Manchester United’s £232mn. 

Chelsea’s new owners have also been quick to reorganise the way the club is financed, taking on £800m of debt. The money, revealed by the FT this week, includes a £300mn revolving credit facility and a £500mn term-loan. The loan will help make up the £1.75bn the new owners committed to invest in the club — both on playing staff and infrastructure upgrades — during the takeover beauty parade. 

Interest payments will be borne by the owners, not the club itself, said a person close to them, while no Chelsea assets have been pledged to secure the financing. But the arrangement is a swift reminder that Chelsea has entered a completely new era. Gone are the days when a deep-pocketed benefactor would bankroll the club’s spending, enabling them to compete at the highest level both on and off the pitch. Instead Chelsea will need to become a far more commercially driven business. Glick is going to be a busy man. 

The gambling guru fixing a billionaire’s $5bn sports bet

Sir Leonard Blavatnik has bet big on sports streaming company DAZN.

The billionaire, who has profited from investments ranging from Russian oil to rock ‘n’ roll, has poured more than $5bn into the London-based group.

The company was meant to revolutionise the staid world of sports broadcasting, where viewers still largely watch games on television. 

But DAZN lost roughly $3.7bn from 2019-21, its woes exacerbated by the shutdown of live sport during the pandemic. 

Last year, Blavatnik took drastic action, bringing in fresh management. Shay Segev, a former betting executive with an entrepreneurial streak and a passion for coding, joined from listed gambling group Entain.

In his first interview since the move, the Israel-born chief executive set out his vision to make DAZN profitable in the next 12-18 months. He’s focused on global sports screening rights and an expansion into sports betting as politicians and regulators crack down on high-stakes casino-style wagers. DAZN Bet, he says, will have a more “recreational” feel.

As well as existing domestic deals to screen Spanish, Italian and German football, Segev wants wider-spanning rights and content, such as DAZN’s recent deal to screen the Uefa women’s Champions League, in a strategy aimed at achieving scale. His pitch to leagues and sports fans is a “quality, consistent” broadcast all over the world. 

“We will move more and more trying to do these multi-jurisdiction, global deals, which I believe on balance long-term is better for rights holders [sports leagues] and customers,” Segev told Scoreboard. “I’m meeting a lot of rights holders … I see more of them looking to do these global deals.”

But Segev has his work cut out. Big tech companies are increasingly hungry for live sport, with Apple recently signing a global deal to screen US Major League Soccer for a decade.

“I’m talking about the long-term vision, I’m not saying that in the next two years DAZN will buy all the rights for everything across the world,” he said. “We’re the only one that’s a pure-play sport platform.”

Blavatnik will be watching his new recruit with interest.

Highlights

• Sixth Street has invested another €310mn in FC Barcelona’s media rights, a further injection of much-needed capital from the US investment group. The Catalan club is already back to signing star players, including Polish striker Robert Lewandowski, despite its financial woes.

• BT Sport staff consulted with rivals at Sky about pay rates for freelance workers in 2018, according to an email seen by the Financial Times. The UK’s Competition and Markets Authority is investigating whether the two broadcasters, as well as IMG Media and ITV had fixed the day rates offered to freelancers.

• Mercedes’ Formula One racing team plans to invest millions of euros on so-called sustainable aviation fuels, in an aim to reduce the sport’s carbon footprint. F1 relies on using aircraft for transporting its teams, staff, cars and other parts around the world to compete.

• Magnus Carlsen, the world chess champion, said he won’t defend his crown after losing the motivation to play another gruelling classic matchup over weeks. The Norwegian’s decision is a blow for chess as he is one of the few players whose fame transcends the game.

• Podcast for the weekend? Does sport hold real lessons for leaders? Or is it just machismo? Listen in as host Isabel Berwick talks to former England cricketer Jeremy Snape, founder of consultancy Sporting Edge, and former FT editor Lionel Barber.

Finish line

Jake Wightman has become the World 1500m champion. Geoff calling his son becoming a World Champion is priceless. Helene, part of our team, filmed Dad. I sat with Mum Susan..then could not wait to give my mate a hug. Beyond proud. ❤️@JakeSWightman @WightmanGeoff @SusanWightman6 pic.twitter.com/8I8IT6ntwb

— Katharine Merry (@KatharineMerry) July 20, 2022

It’s one of the most touching sports commentaries you’ll ever hear — or watch. Geoff Wightman, the athletics commentator and former marathon runner, was on hand to call his son’s race to win the 1500m world title. No prize for guessing the moment Jake Wightman crossed the line.