Billionaires Mark Walter and Todd Boehly have agreed to sell their combined 25% stake in English soccer club Chelsea in a transaction valued at approximately £950 million ($1.27 billion). The sale, announced Wednesday, transfers their shares to Clearlake Capital, a California-based private equity firm that already holds a majority ownership position in the club. Existing minority shareholder Hansjorg Wyss will maintain his stake following the deal.

Walter and Boehly each owned about 12.5% of Chelsea, meaning the proceeds will be split equally, with each receiving roughly $650 million. The transaction values Chelsea at about £5 billion, including debt. The two billionaires initially acquired their stakes as part of the Boehly-Clearlake consortium that bought Chelsea in 2022 from Russian billionaire Roman Abramovich for nearly £4.3 billion. Abramovich’s sale was prompted by sanctions imposed by the United Kingdom due to his ties to the Kremlin.

During their tenure as part-owners, Boehly was the public face and chairman of the club while Walter maintained a more behind-the-scenes role, rarely attending matches. Despite some criticism from Chelsea fans directed at Boehly, he acknowledged challenges in leadership but emphasized the global stature of the Chelsea brand.

The sale follows a period of intermittent discussions about ownership restructuring, amid reported tensions within the group. Clearlake’s enhanced control over the London-based club is expected to facilitate a strategic decision on the future of its stadium, potentially involving either redevelopment of Stamford Bridge or the construction of a new facility.

For Walter, the timing comes amid regulatory scrutiny of his broader business interests. Federal authorities are investigating his insurance enterprises over loans made to finance his other ventures, focusing on potential irregularities. Walter’s companies deny any wrongdoing, stating that there was no fraud involved at either Guggenheim Partners—the Wall Street firm he co-founded—or his insurance businesses.

Walter has been actively managing his assets amid this scrutiny. Last month, he agreed to sell his majority stake in the Los Angeles Lakers basketball team in a deal valuing the franchise at $12.5 billion, despite having acquired the stake only a year prior.

Walter and Boehly have a long history of joint investments, including a 2012 purchase of the Los Angeles Dodgers baseball team for $2.15 billion. That transaction, partly funded by loans from their insurance companies, drew attention for triggering increased private equity interest in sports franchises.

Evercore acted as lead financial adviser on the Chelsea transaction. Additional advisors for Clearlake included Raine Group, BDT&MSD Partners, and BofA Securities, while Goldman Sachs advised the sellers.