Former Chelsea and Leeds United owner Ken Bates has died at the age of 94.

Chelsea announced the death of Bates on Saturday, saying he “passed away peacefully in Monaco this morning surrounded by his wife and family”.

Bates bought Chelsea for £1 in 1982 when they were in the old Second Division, taking on debts of £1.5m, and set about turning around their fortunes.

He eventually sold the club to Roman Abramovich in 2003 in a deal worth £140m when they were in the English top flight.

The club were heavily in debt when Bates sold his shares. He stayed on as chairman at Stamford Bridge before stepping down in 2004.

Chelsea said in a statement: “It is with great sadness that we share the news of the loss of Ken Bates, former owner and chairman of Chelsea Football Club.

“The club sends our heartfelt condolences to Ken’s wife Suzannah, the rest of his family and his friends.

“Ken’s determination to fight for Chelsea when times were tough, and drive the team on to winning trophies will never be forgotten.”

John Neal, John Hollins, Bobby Campbell, Ian Porterfield and David Webb served as managers under Bates before he appointed Glenn Hoddle, Ruud Gullit, Gianluca Vialli and Claudio Ranieri.

It was under Gullit that Chelsea ended their 26-year wait for a major trophy when they won the FA Cup in 1997.

The Blues also won the League Cup, European Cup Winners’ Cup and the FA Cup again before Bates sold to Abramovich in 2003.

The Chelsea Supporters’ Trust said it was “deeply saddened” to learn of Bates’ death.

“Ken was one of the most significant figures in Chelsea Football Club’s modern history,” the Trust said.

“Taking charge during one of the club’s most difficult periods, he played a defining role in securing the club’s future at Stamford Bridge and helping lay the foundations for the success that followed.

“His impact on Chelsea will be remembered for generations, and his place in the club’s history is assured.”

After failing in a bid to invest in Sheffield Wednesday, Bates was Leeds owner from January 2005 to December 2012.

Leeds lost in the Championship play-off final in 2006 and a year later went into administration and were relegated to English football’s third tier for the first time.

Bates was part of a consortium that bought the club back from the administrators and Leeds returned to the Championship in 2010.

Although Bates sold the club towards the end of 2012, he stayed on as chairman and then briefly honorary president before leaving Leeds in July 2013.