Chelsea Pitch Owners
Encyclopedia
Chelsea Pitch Owners plc a is a non-profit
organization that owns both the freehold of the Stamford Bridge stadium
and the naming rights
of Chelsea Football Club.
troubles during the 1970s and 1980s following a large-scale attempt to renovate Stamford Bridge. The financial crisis and a subsequent change of ownership at the club culminated in the sale of the Stamford Bridge freehold to property developers Marler Estates (and subsequently Cabra Estates). The move almost saw Chelsea lose the stadium.
The future of the stadium (and hence the club) was only secured in 1992, when the property developers were bankrupted
by a market crash, allowing the then-chairman Ken Bates
to do a deal with their bankers and to regain control of the stadium for the football club. Following this, Chelsea Pitch Owners was created, and in 1997 it purchased the Stamford Bridge freehold, the turnstile
s, the pitch
and the Chelsea FC name with the aid of a non-recourse
loan
of £10 million from Chelsea Village plc, the parent company of the club. The CPO in turn granted the club a 199 year lease on Stamford Bridge at a peppercorn
rent.
In granting control of the freehold to Chelsea Pitch Owners, the intention was to ensure that Stamford Bridge could never again be sold to property developers. Irrespective of how many shares are owned by an individual, voting rights are limited to 100 per shareholder
to prevent any one person or organisation gaining control of the CPO.
The CPO also owns the name Chelsea Football Club Ltd, which is licenced back to the club on condition that the first team play their home matches at Stamford Bridge. This means that should Chelsea move to another stadium in the future, they would not be able to use the name Chelsea Football Club without permission from 75% of CPO shareholders.
The company is a non-profit organisation and is not listed on any Stock Exchange
. Its purpose is to raise the money needed to pay off the loan and then lease the freehold back to the club, on the strictly-defined proviso that the ground may only be used for football
purposes. Fans are encouraged to purchase shares in order to secure the club's future. As of 2011, around 15,000 CPO shares have been sold, and approximately £1.5million of the debt has been paid off. Club captain John Terry
is the current President of the CPO.
, said: "Chelsea should always be grateful to those who invested in CPO. We know only too well how close the club came to losing our home prior to the formation of CPO, but that threat has now gone under Mr Abramovich
's ownership and with the CPO structure in place we cannot plan with certainty for the future. I hope all shareholders vote in favour of the proposal."
Chelsea Chief Executive Ron Gourlay
said: "I am sure all Chelsea fans have enjoyed the football and success we have witnessed at Stamford Bridge since 2003 and Chelsea Football Club and Mr Abramovich are determined to ensure that the club continues to compete at the highest level of world football." He added: "We continue to look at options for expanding the Bridge and I should be clear that we have not identified a site for a new stadium elsewhere."
The proposal was brought in a general CPO meeting on 27th October 2011 but failed to pass as only 61.6% of the total votes were cast in favour of the proposal, below the 75% minimum requirement.
Nonprofit organization
Nonprofit organization is neither a legal nor technical definition but generally refers to an organization that uses surplus revenues to achieve its goals, rather than distributing them as profit or dividends...
organization that owns both the freehold of the Stamford Bridge stadium
Stamford Bridge (stadium)
Stamford Bridge is a football stadium in Fulham, in the London Borough of Hammersmith and Fulham, West London, and is the home of Chelsea Football Club. The stadium is located within the Moore Park Estate also known as Walham Green and is often referred to as simply The Bridge...
and the naming rights
Naming rights
In the private sector, naming rights are a financial transaction whereby a corporation or other entity purchases the right to name a facility, typically for a defined period of time. For properties like a multi-purpose arena, performing arts venue or an athletic field, the term ranges from three...
of Chelsea Football Club.
History
Chelsea suffered serious financialFinance
"Finance" is often defined simply as the management of money or “funds” management Modern finance, however, is a family of business activity that includes the origination, marketing, and management of cash and money surrogates through a variety of capital accounts, instruments, and markets created...
troubles during the 1970s and 1980s following a large-scale attempt to renovate Stamford Bridge. The financial crisis and a subsequent change of ownership at the club culminated in the sale of the Stamford Bridge freehold to property developers Marler Estates (and subsequently Cabra Estates). The move almost saw Chelsea lose the stadium.
The future of the stadium (and hence the club) was only secured in 1992, when the property developers were bankrupted
Bankruptcy in the United Kingdom
Bankruptcy in the United Kingdom does not have a singular law. There is one system for England and Wales, one for Northern Ireland and one for Scotland.Across the United Kingdom, bankruptcy refers only to insolvency of individuals and partnerships...
by a market crash, allowing the then-chairman Ken Bates
Ken Bates
Kenneth William Bates is a British businessman and football executive. The current chairman and now owner of Leeds United AFC, Bates was previously chairman and majority shareholder of Chelsea FC from 1982 until 2003....
to do a deal with their bankers and to regain control of the stadium for the football club. Following this, Chelsea Pitch Owners was created, and in 1997 it purchased the Stamford Bridge freehold, the turnstile
Turnstile
A turnstile, also called a baffle gate, is a form of gate which allows one person to pass at a time. It can also be made so as to enforce one-way traffic of people, and in addition, it can restrict passage only to people who insert a coin, a ticket, a pass, or similar...
s, the pitch
Association football pitch
An association football pitch is the playing surface for the game of association football made of turf. Its dimensions and markings are defined by Law 1 of the Laws of the Game, "The Field of Play".All line markings on the pitch form part of the area which they define...
and the Chelsea FC name with the aid of a non-recourse
Nonrecourse debt
Non-recourse debt or a non-recourse loan is a secured loan that is secured by a pledge of collateral, typically real property, but for which the borrower is not personally liable. If the borrower defaults, the lender/issuer can seize the collateral, but the lender's recovery is limited to the...
loan
Loan
A loan is a type of debt. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the lender and the borrower....
of £10 million from Chelsea Village plc, the parent company of the club. The CPO in turn granted the club a 199 year lease on Stamford Bridge at a peppercorn
Peppercorn (legal)
A peppercorn in legal parlance is a metaphor for a very small payment, a nominal consideration, used to satisfy the requirements for the creation of a legal contract. "A peppercorn does not cease to be good consideration if it is established that the promisee does not like pepper and will throw...
rent.
Organization and ownership
Shareholder
A shareholder or stockholder is an individual or institution that legally owns one or more shares of stock in a public or private corporation. Shareholders own the stock, but not the corporation itself ....
to prevent any one person or organisation gaining control of the CPO.
The CPO also owns the name Chelsea Football Club Ltd, which is licenced back to the club on condition that the first team play their home matches at Stamford Bridge. This means that should Chelsea move to another stadium in the future, they would not be able to use the name Chelsea Football Club without permission from 75% of CPO shareholders.
The company is a non-profit organisation and is not listed on any Stock Exchange
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
. Its purpose is to raise the money needed to pay off the loan and then lease the freehold back to the club, on the strictly-defined proviso that the ground may only be used for football
Football (soccer)
Association football, more commonly known as football or soccer, is a sport played between two teams of eleven players with a spherical ball...
purposes. Fans are encouraged to purchase shares in order to secure the club's future. As of 2011, around 15,000 CPO shares have been sold, and approximately £1.5million of the debt has been paid off. Club captain John Terry
John Terry
John George Terry is an English professional footballer. Terry plays in a centre back position and is the captain of Chelsea in the Premier League...
is the current President of the CPO.
Club proposal
On 3 October 2011, Chelsea Football Club made a proposal to buy back the freehold land (owned by CPO) on which the football stadium at Stamford Bridge sits, which would pave the way for a move to a new ground. Chelsea Chairman Bruce BuckBruce Buck
Bruce M. Buck is an American attorney and founding managing partner of the London office of U.S. law firm Skadden, Arps, Slate, Meagher & Flom . He is also Chairman of Chelsea Football Club...
, said: "Chelsea should always be grateful to those who invested in CPO. We know only too well how close the club came to losing our home prior to the formation of CPO, but that threat has now gone under Mr Abramovich
Roman Abramovich
Roman Arkadyevich Abramovich is a Russian businessman and the main owner of the private investment company Millhouse LLC.In 2003, Abramovich was named Person of the Year by Expert, a Russian business magazine. He shared this title with Mikhail Khodorkovsky...
's ownership and with the CPO structure in place we cannot plan with certainty for the future. I hope all shareholders vote in favour of the proposal."
Chelsea Chief Executive Ron Gourlay
Ron Gourlay
Ron Gourlay is the Chief Executive of Chelsea Football Club. He took the position on 31 Oct 2009, Before he was Chief Operating Officer of the club.-Chelsea FC:...
said: "I am sure all Chelsea fans have enjoyed the football and success we have witnessed at Stamford Bridge since 2003 and Chelsea Football Club and Mr Abramovich are determined to ensure that the club continues to compete at the highest level of world football." He added: "We continue to look at options for expanding the Bridge and I should be clear that we have not identified a site for a new stadium elsewhere."
The proposal was brought in a general CPO meeting on 27th October 2011 but failed to pass as only 61.6% of the total votes were cast in favour of the proposal, below the 75% minimum requirement.