Blues hunt the black: Chelsea to stand on its own 22 feet

Peter Kenyon tells Abigail Townsend about the end of Village life and the drive for profits
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Chelsea, the London football club owned by Russian oligarch Roman Abramovich, is to be overhauled as it strives to move into the black by 2005.

Chelsea, the London football club owned by Russian oligarch Roman Abramovich, is to be overhauled as it strives to move into the black by 2005.

Its chief executive, Peter Kenyon, formerly the head man at Manchester United, has introduced a new club badge and is changing the company's name back to Chelsea Football Club from Chelsea Village.

The name was created by the former chairman, Ken Bates, who developed a leisure complex consisting of two hotels and various restaurants, as well as a nightclub and fitness centre, at the club's Stamford Bridge home in west London.

Mr Kenyon, however, wants the club - which has not won the League for 49 years - to move away from leisure and back towards being a more football-centred business.

He is reviewing the future of the complex and is in talks with a number of operators about taking over the running of the non-football businesses.

It is believed that Hilton and Marriott are both in discussions about operating the hotels, while fish-and-chip-shop chain Harry Ramsden's could come in to run at least one of the restaurants. Catering giant Compass has also been bought in to advise on concourse and catering facilities.

In addition, talks are progressing to find a new sponsor for the club, which has spent around £200m on new players since Mr Abramovich bought the debt-ridden business last year for an estimated £60m.

The main contenders are believed to be electronics giant Sony, and mobile phone companies T-Mobile and mmO 2. Orange, the current official mobile network of the club, is not thought to be in the running, however.

The club's £20m, four-year deal with current shirt sponsor, Emirates, comes to an end this season, with the airline moving to rivals Arsenal to sponsor both its shirts and its new ground. It is understood that Chelsea is hoping to secure a new deal for up to £9m a year, though Mr Kenyon has ruled out naming the stadium after the sponsor.

"I don't think it's appropriate for Chelsea, and it's not a revenue stream that we expect to get into," he said.

Mr Kenyon is confident he will be able to match profits at Manchester United, the world's most profitable football club, by growing revenues by 10 per cent per annum. Man U reported revenues of £169m for the year to July 2004, while operating profits came in at over £29m.

"We know that a football club run properly can be profitable," he said. "We want to be the number one club in Europe, on and off the field. It's about ensuring that we're more professionally run and profitable. Today we're not profitable - we will be within five years."

He denied that Mr Abramovich was scaling back his financial support, however, despite admitting that scope for transfer fees had been built into the budget. So far, Mr Abramovich has bankrolled the acquisition of new players.

"I don't think it's prudent today to run a football club on the basis of a benefactor. Part of our job is to leave it in good shape and good shape means self-sufficient. There are too many examples of clubs running themselves inefficiently and getting themselves into trouble.

"Roman will continue to invest so I'm not concerned about that at all, but our job is to make ourselves successful and start repaying that investment."

As part of the push towards profitability, the club will try to increase its membership base from 40,000 to more than 100,000 globally in the next three years. Target markets are China and North America, though the US has proved a tough market for English clubs to crack. Man U has been trying for several years with only limited success.