Chelsea confirms investor talks

Chelsea Village, the holding company behind Chelsea Football Club and its surrounding assets, has confirmed rumours that it is in negotiations to sell a large slug of the company to outside investors, adding that any shares issued would be 'at a price representing a significant premium' to its share price before the announcement. Ben Cobley reports.

This afternoon the club issued a statement saying that it is going to call an emergency general meeting (EGM) to 'disapply the statutory rights of pre-emption' of existing shareholders, which would allow it to issue shares to outside investors without making a corresponding offer to existing shareholders.

It added that 'the reason for this is the Company is in negotiation with a number of parties with a view to issuing either all or a substantial proportion of its unissued share capital' at a big premium to the 18.5p share price at which it started the trading day. By the close, those shares had soared 24 per cent to 23p.

Debt-laden Chelsea has already been in talks with a number of parties about selling part, or all, of the company to interested parties. Indeed it has been reported that chairman Ken Bates held preliminary takeover talks with the Tchenguiz brothers (well-known property developers) last year, although these came to nothing.

Bates also offered his friend and Fulham Football Club's owner Mohammed Al-Fayed a 9.9 per cent stake in Chelsea Village last autumn in return for Fulham sharing the Stamford Bridge football ground, but was turned down.

Fulham has been looking for a new home, after local residents protested over plans to redevelop and expand the capacity of its Craven Cottage site on the Thames riverside. Its proposal to buy a site close to Queens Park Rangers' ground in Shepherds Bush was rejected in favour of a bid by fully-listed Helical Bar and Morley Fund Management, which in turn rejected requests to partner the club in its plans to build a stadium there.

Fulham has been playing its home games at Q.P.R's Loftus Road ground this season, but match attendance has been disappointing and Al-Fayed has consistently reiterated his plans to find a home in the borough of Hammersmith & Fulham – where Stamford Bridge is situated.

An announcement revealing more will be made shortly, but with a market capitalisation of £39 million representing a substantial discount to its last stated tangible net asset value of £133 million, a bid and associated refinancing could put a different hue on Chelsea's still-depressed share price.