Why Chelsea left millions on the table after announcement made and £1bn plan explained

Why Chelsea left millions on the table after announcement made and £1bn plan explained Newspoint | 02/05/2025 21:39:18

Earlier this week saw the announcement that Chelsea, after almost nine months without a shirt sponsor, had inked a short-term deal with Dubai-based real estate firm DAMAC Properties until the end of the season.

, and while shirt link-up looks set to be the briefest of unions, with the club eyeing potential new shirt sponsors for both the FIFA Club World Cup this summer, and another for the start of next season’s Premier League, the firm has committed to designing and launching a new £1 billion development of Chelsea-themed buildings in Dubai.

It is a commercial boost for the club before the financial year end, which for runs until June 30, and creates a partnership that will drive revenue growth for the club beyond the initial shirt agreement.

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Last season saw Chelsea partner with Infinite Athlete, a sports technology company with investment links to Blues co-owner Todd Boehly’s Eldridge Industries firm, with the value of that deal pegged at around £40m per season.

But no deal was struck for 2024/25, a move that has left tens of millions in unrealised revenue on the table. The link-up with DAMAC claws back some of that, but given the short-term alliance,it won’t be the shirt deal that provides the real opportunity, that will come from the plans for the potential of the real estate development in Dubai.

At present, Chelsea are in a three-way battle with Nottingham Forest and Aston Villa to claim fifth spot, something that will, this year, deliver a UEFA Champions League spot next season.

That would be impactful for whoever manages to bag it, with the ability to leverage participation in European football elite, and most lucrative club knockout competition enabling clubs to ask for more when going to market for new commercial partners or extending with existing ones.

Given the lack of Champions League qualification since Boehly and Clearlake Capital came on board as owners in May 2022, Chelsea’s ability to sell the major sponsorship inventory that is the front of shirt partner has been hamstrung due to the far market value rules that the Premier League applies. The Blues, while they may feel that they should be able to, cannot realistically expect to get deals of the same level, or higher, than clubs with greater success in recent seasons and greater exposure, such as Liverpool or Manchester City.

Chelsea’s reasons for deciding not to engage in a partnership with a firm at the start of this season were centred around them not being able to command the value that they would want for that sponsorship inventory, knowing that if they agreed a deal at a lower sum than they wanted, even if for a year, it would impact what they could get on the back of a more successful this season when going to market for a potentially long-term partnership before the start of next season.

The DAMAC partnership allows them to realise some short-term revenue that will likely be single-digit millions given the brief nature of it. It also presents the opportunity to sell sponsorship for the front of shirt for when the club competes in the Club World Cup, something that may be of significant interest and value to North American companies looking to get eyeballs on their brand in the football space given that the competition is taking place in the USA this summer, a year out from the 2026 FIFA World Cup taking place on North American soil.

They then have the chance to sell a longer-term partnership from 2025 and beyond, one that they will expect to have greater value that could have been achieved last summer.

At £225m in 2024, Chelsea's commercial revenue was the fifth highest in Premier League, some way behind Manchester City's £345m per year and Liverpool's £308m for last season.

Chelsea have left significant revenue on the table, but they are betting that they can eke more out of the end of this season and the opportunities this summer to be able to improve their situation from next season. Qualification for the Champions League will add value to any potential deal, and that makes the Premier League run-in for the Blues of huge importance.