always thought fm had it wrong

when it came to the likes of chelsea and man u getting in to realy bad debt a few years down the line, always though chelsea? isnt RA just giving them money for the fun of it.

The money Roman Abramovich has poured into Chelsea is in the form of an interest-free loan rather than a donation, according to reports.

According to recent accounts, the club owe a massive £736million to assorted creditors, and The Guardian claims around £578million of that figure is owed to Abramovich.

It was previously thought that the Russian had simply ploughed this money into the club as a donation, an assumption that was encouraged by chief executive Peter Kenyon, who emphasised that Chelsea had no 'external' debts when announcing reduced losses in February of this year.

The club announced record turnover of £190.5million, bringing their losses down to 'just' £75.8million from £80.2million, but it is still a long way from the fiscal independence that Kenyon craves.

"With the company being external debt free and our ownership clearly demonstrating continuing commitment to the long term, I am very confident about the future," Kenyon said.

However, given that these funds are in every sense a loan, and therefore in theory could be called in, Chelsea would be in serious trouble should Abramovich ever tire of his plaything and decide he wants his money back.

The Guardian suggests that should that situation occur, Chelsea would have 18 months to pay back the money. Given that Kenyon optimistically expects the club to 'break even' by 2010, that might be a struggle.

In slightly more expected news, The Guardian also reports that Manchester United owe an equally-extraordinary £764million to external creditors, £666million of which is to the assorted financial institutions that loaned the Glazer family the money to buy the club in 2005.

The loans - now of course loaded on to the club by Glazer - incurred interest payments of £81million last year.

i wouldnt be too disappointed if it goes down like it does in FM

when it came to the likes of chelsea and man u getting in to realy bad debt a few years down the line, always though chelsea? isnt RA just giving them money for the fun of it.

The money Roman Abramovich has poured into Chelsea is in the form of an interest-free loan rather than a donation, according to reports.

According to recent accounts, the club owe a massive £736million to assorted creditors, and The Guardian claims around £578million of that figure is owed to Abramovich.

It was previously thought that the Russian had simply ploughed this money into the club as a donation, an assumption that was encouraged by chief executive Peter Kenyon, who emphasised that Chelsea had no 'external' debts when announcing reduced losses in February of this year.

The club announced record turnover of £190.5million, bringing their losses down to 'just' £75.8million from £80.2million, but it is still a long way from the fiscal independence that Kenyon craves.

"With the company being external debt free and our ownership clearly demonstrating continuing commitment to the long term, I am very confident about the future," Kenyon said.

However, given that these funds are in every sense a loan, and therefore in theory could be called in, Chelsea would be in serious trouble should Abramovich ever tire of his plaything and decide he wants his money back.

The Guardian suggests that should that situation occur, Chelsea would have 18 months to pay back the money. Given that Kenyon optimistically expects the club to 'break even' by 2010, that might be a struggle.

In slightly more expected news, The Guardian also reports that Manchester United owe an equally-extraordinary £764million to external creditors, £666million of which is to the assorted financial institutions that loaned the Glazer family the money to buy the club in 2005.

The loans - now of course loaded on to the club by Glazer - incurred interest payments of £81million last year.

i wouldnt be too disappointed if it goes down like it does in FM

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">However, given that these funds are in every sense a loan, and therefore in theory could be called in, Chelsea would be in serious trouble should Abramovich ever tire of his plaything and decide he wants his money back. </div></BLOCKQUOTE>

.....Gretna

i think chelsea will be a little worse of if he demands his oney though, £500,000,000 is the team worth that much? i mean with facilities stadium ect. i doubt he'd leave them like that but it would be nice.

I'm not sure that is entirely correct.

If Abramovich's money was as an interest free loan, then where does the £500m he placed into a trust fund, for when he eventually sells up, come into play. It would seem very peculiar for him to put money into a cash reserve specifically for the club, if he expects other monies he's paid in to be returned to him.

Is there definitely debt to Abramovich. It may have to be attributed as debt, due to the nature of investment, without money actually being owed back.

I believe this is all hearsay though?

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Neji:

I believe this is all hearsay though? </div></BLOCKQUOTE>

What specifically? It's per the accounts, so the numbers certainly aren't. There's no other very obvious way to account for all that money he's put in, other than as a loan.

The thing is though, the TV money they receive is already crazy, yet they still make these massive losses. /they obviously expect their income to continue to increase. What happens if you have a situation like in the 80's where tv interest in football dries up?

The Sky money is supported by advertising and that is one of the first things companies cut in a recession. A few years down the line I can definitely see some very big clubs get into some very big trouble (if they aren't already).

Well considering Abramovich own like 99.9999% of Chelsea I dont think there is much difference between him just giving the club the money and him giving it a loan. If he owned 100% then there would be no difference and he could put in and take out money as he wished. Does it make a difference when he sells the club? No because if it is a loan then that gets taken off the sale value and the new owner will probably pay it back immediately anyway and if its not a loan then the club value will be higher. The money gets payed to Abramovich either way.

Abramovich = top business man.