Chelsea to offer financial services

Click to follow
The Independent Online
CHELSEA FANS will soon be able to deposit money and buy home insurance from the London football club, it emerged yesterday. Chelsea Village, the company which owns the Premiership team, is set to launch a range of Chelsea-branded financial services at the start of next year.

The news came as rivals Newcastle United revealed talks with other football clubs about setting up a chain of retail stores to boost merchandise sales outside the North-east.

Chelsea Village, which is listed on the Alternative Investment Market, said that a number of financial groups were vying to design and market the new products. Services to be provided will include Chelsea current and savings accounts, home, car and health insurance, and life assurance. PEPs and unit trusts could also be sold, although they are likely to be contracted out to specialist providers.

Michael Russell, the Chelsea Village finance director, said that the club was seeking to get different partners for different products in order "to get the best deals for the fans". Under the plans, Chelsea will act as a go-between, providing its partners with details of its 60,000 members, but will not offer financial advice.

Chelsea is the second major football club to move into financial services. Last month, Leeds United teamed up with the insurer Allied Dunbar and Skipton Building Society to launch a number of financial products.

News of the financial plans came as Chelsea Village swung back into the black, despite a leap in the players' wage bill and series of setbacks in its ambitious development plans. The company reported a pounds 2.1m profit for 1998, compared with a pounds 400,000 loss in the previous year.

A number of high-profile signings over the summer, including the Italian striker Pierluigi Casiraghi, caused a jump of almost 60 per cent in players' salaries, but the company declined to specify the total amount paid out to its stars. The increase in the wage bill was partially offset by EDT, the travel agent bought in July, which contributed over pounds 30m in turnover, while the football club brought in pounds 37m.

Dennis Cassidy, Newcastle's chairman, said the planned stores would mimic the Field of Dreams chain in the United States, which sells a range of gear for a variety of baseball teams. The stores would allow Newcastle and other clubs to reach fans all over the country without having to set up their own stores.

The news emerged as Newcastle reported that sales of its merchandise dropped 10 per cent to pounds 8.1m in the year to 31 July. However, a sharp increase in match, television and sponsorship revenues boosted overall sales 20 per cent to pounds 49.2m. Before transfer fees, operating profits increased 33 per cent to pounds 10.8m, despite a 20 per cent jump in the wage bill.

Mr Cassidy denied reports that the company had been approached by a variety of bidders, adding that predators were likely to await the outcome of British Sky Broadcasting's bid for Manchester United before making a move. The shares closed up 10p at 100p.

Comments