Yes, it still needs to be repaid. However, as per the terms of the deal reported at the time, that debt belongs to Clearlake, Boehly etc personally, not BlueCo or the club. The ownership consortium supposedly paid that cash to BlueCo, who pay it to the club.
I can't find any reports to expand on the debt @axman2526 is talking about, but as explained that would be a debt that BlueCo owns, since it is secured against BlueCo's assets not the club directly. BlueCo would loan Chelsea money and use those repayments to pay their lenders. Either way, the club will need to repay that money itself, however as it is for operational costs it is subject to PSR scrutiny.
Prior to City's legal challenge, BlueCo could loan this money to Chelsea at zero interest, but with the new PSR rules, any loan from BlueCo to Chelsea will need to be assessed for a market value interest rate. No idea what the market interest rate is like for business loans in the UK but i'd guess it's around 5%, meaning we have to pay back any money loaned from the owners (via BlueCo) at 5% interest. One unexpected advantage is that BlueCo/Chelsea go into this initial funding round under the new rules with a blank slate, whereas other clubs such as Arsenal, Tottenham and Liverpool now must recalculate the repayments owed to their owners on their existing debt.
There is a distinct advantage to this arrangement. If the club can't make those repayments to BlueCo, and BlueCo in turn defaults on the debt, the lenders can't touch the club, although they can pursue the former club assets owned by BlueCo. The second thing is that any interest payments made by Chelsea are recirculated back into BlueCo, which means that Chelsea are effectively paying themselves, although again BlueCo might use the interest payments to offset their own.
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SydneyChelsea ·