Ares Management Corp. is considering loosening ties with Crystal Palace FC as it explores an investment in rival British football club Chelsea FC, people with knowledge of the matter said.

US-based Ares is in discussions about changing the structure of its investment in Eagle Football Holdings, the vehicle that owns roughly 40% of south London-based Crystal Palace, according to the people. This could see Ares relinquishing its position on Eagle Football’s board, they said.

Bloomberg News reported earlier this month that Ares is in talks about investing in Chelsea, the west London team that was taken over by a private equity-backed consortium in 2022. Any such move could pose a problem for Ares as both clubs compete in the English Premier League, which has strict rules on investors holding interests in more than one team.

The rules, designed to prevent conflicts of interest and protect the competitive integrity of the world’s richest football league, include prohibiting the owners of one club from having a significant financial interest in, or material influence over, management in another. Eagle Football’s influence at Crystal Palace is mainly exerted by its founder and majority owner, the US investor John Textor.

Ares has made no final decisions on its position at Eagle Football, the people said. Representatives for Ares and Eagle Football declined to comment. A spokesperson for Crystal Palace didn’t immediately provide comment.

The deliberations highlight the challenges that investment firms can face when trying to build exposure to the most popular sport in the world. Eagle Football is one of a rapidly expanding group of so-called multiclub owners that hold stakes in various clubs in different countries.

Ares invested in Eagle Football last year when the multiclub group acquired Olympique Lyonnais in France. Ares partners occupy two of eight seats on Eagle Football’s board.

Through Eagle Football, Ares also has exposure to Botafogo in Brazil and Belgium’s RWD Molenbeek. Separately, Ares is an investor in Inter Miami CF, the Major League Soccer team that’s home to Argentine superstar Lionel Messi, and Spanish club Atlético de Madrid.

Ares last year raised $3.7 billion to invest in sports, media and entertainment, more than twice the $1.5 billion originally targeted. The fund invests across the capital structure in both debt and equity.

A move to invest in Chelsea, one of the most successful English clubs of the last 20 years, would represent one of Ares’ biggest plays in the sport to date. Chelsea could look to raise around $500 million to support its long-term objectives, which include the redevelopment of its stadium and other infrastructure, Bloomberg News reported previously.

Read More: Why Multiclub Ownership Is Roiling World Football: QuickTake

Author: David Hellier, Silas Brown and Irene García Pérez